CA ANZ proposes a technical amendment to the FMC Act Amendment Bill to include an exception to the section 529 Financial Markets Conduct Act 2013 (FMCA) prohibition on limiting liability of FMC auditors, to enable regulations to be made setting out details of a scheme to cap the liability of FMC auditors by:

1. Amending section 529(1) of the FMCA to include an exception “Except in the prescribed circumstances …”; and
2. Extending the regulation-making powers in section 548 of the FMCA to provide that regulations can be made for the purposes of section 529 to set out the parameters of any FMC auditor liability capping regime.

This proposal, consistent with other technical amendments in the Bill, would cut red tape, improve the operation of the legislation, and reduce costs on business and government. Cabinet has decided to progress consideration of audit liability reform as part of a 2025 capital market settings reform programme as outlined in the Cabinet Minute ECO-24-MIN0296 dated 4 December 2024. Acceptance of our submission would facilitate the first step in such a reform.