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Why are Corporate Trustees licensed as supervisors?

The law requires certain investments to have a licensed supervisor.

Every registered scheme including KiwiSaver schemes, and every regulated offer of a debt security, must have a licensed supervisor (sections 127 and 103 of the Financial Markets Conduct Act 2013). The operator of a retirement village must appoint a statutory supervisor (section 38 of the Retirement Villages Act 2003).

Our members are licensed by the Financial Markets Authority under section 16(1) of the Financial Markets Supervisors Act 2011. Copies of their licences are available on the FMA website.


Role of supervisors

Supervisors have a range of responsibilities in relation to supervising the performance and financial position of issuers, scheme managers and retirement village operators, for acting on behalf of investors, and for custody of scheme property.

Details are set out in sections 152-155 (for registered schemes) and sections 111-119 (for debt securities) of the Financial Markets Conduct Act 2013 and in sections 42-43 of the Retirement Villages Act 2003.

Non-regulated products

Corporate Trustees undertake a range of roles in respect of non-regulated products including:

  • Securitisation structures: roles include Trustee of a trust, Security Trustee (holding the security on behalf of the secured creditors), registry and paying agent in respect of the note holders;
  • Escrow agent where funds are held on behalf of third parties;
  • Trustee for non-regulated debt issues;
  • Trustee for non-regulated managed funds;
  • Custodian, and Security agent.

Unlike the regulated products, these roles are primarily contractual in nature. The undertakings of the Trustee or agent can depend on the requirements of the parties.