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2023-11-12

Financial Market Infrastructures Act Designation Notice (NZClear) 2023

The Reserve Bank of New Zealand and the Financial Markets Authority issued this notice to designate the NZClear settlement system as a designated financial market infrastructure under the Financial Market Infrastructures Act 2021. The notice declares the system systemically important, assigns the Reserve Bank of New Zealand as its operator and participant, and specifies that it falls within the central securities depository and securities settlement system classes. The designation takes effect on 1 March 2024 and subjects the FMI to the standards and requirements of Subpart 5 of Part 3 of the Act.

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Reserve Bank of New Zealand

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Financial Market Infrastructures Act Designation Notice (NZClear) 2023

Title

  1. This is the Financial Market Infrastructures Act Designation Notice (NZClear) 2023.

Effective Date

  1. This notice comes into effect on 1 March 2024.

Authority

  1. This notice is issued under clause 4 of Schedule 1 of the Financial Market Infrastructures Act 2021 (the “Act”) by the Reserve Bank of New Zealand and the Financial Markets Authority, and has legal effect.

Interpretation

  1. In this notice:

(a) references to “FMI” are references to the NZClear settlement system;

(b) “NZClear settlement system” means the settlement system owned by, and operated and managed by or on behalf of, the Reserve Bank of New Zealand, and includes:

(i) the central securities depository that forms part of the settlement system; and

(ii) the performance of the custodian trustee role by New Zealand Central Securities Depository Limited; and

(iii) a system for the transfer of legal title to securities, including by electronic means;

(c) any term that is defined in the Act and used, but not defined, in this notice has the meaning as in the Act.

Designation

  1. The NZClear settlement system is declared to be a designated FMI.

Operator

  1. The Reserve Bank of New Zealand is the operator of the FMI.

Documents that set out the rules

  1. The document that sets out the FMI’s rules are the NZClear System Rules.

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Specified operator

  1. The Reserve Bank of New Zealand:

(a) is the specified operator of the FMI; and

(b) is an operator to which section 103A of the Personal Property Securities Act 1999 applies.

Systemic importance

  1. The FMI is systemically important.

Operator/s are participants in the FMI

  1. The Reserve Bank of New Zealand is a participant in the FMI.

Application of subpart 5

  1. Subpart 5 of Part 3 of the Act applies to the FMI.

Class or classes

  1. For the purposes of any standards issued under section 31 of the Act, the FMI falls within the following class or classes:

(a) central securities depository; and (b) securities settlement system.

Dated this 13th day of November 2023

[Signature] Ivana Erceg Floerchinger Head of Frontline Regulators & Market Infrastructure Financial Markets Authority

[Signature] Scott Mckinnon Director of Prudential Supervision Reserve Bank of New Zealand

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