The Financial Markets Authority (FMA) of New Zealand has reformed and reintroduces its guidelines on how financial products should be promoted by local brokers. The fresh guidelines are put into practice as of writing this piece, and will apply to all firms with Derivative Issuer (DI) licenses.
The rules reveal that financial services providers need to focus on three crucial things:
- the provision of evidence-supported assertion
- advertisements need to be impressive and not misleading
- ads have to include all relevant details
The Financial Markets Conduct Act strives for so-called “fair dealing” prerequisites, as well as fair and truthful ad campaigns: there should be a balance between risk and reward.
The guideline did not fail to consider how little space advertisers actually have in the online world, even on platforms that thrive on ads like social media outlets. The Financial Markets Conduct Act mandates brokers to use landing pages to fully display their ads, while also straying away from any misleading impressions. The act also wants to ensure that there is a solid consistency between the ad and the landing page.
The reforms were thought of all the way back last year after the regulator proposed new guidelines.