Wholesale investor
An investor who meets statutory financial, professional or experience tests under Schedule 1 of the FMC Act and can therefore access fund offers without the retail-PDS disclosure regime.
A wholesale investor is an investor who qualifies under one or more of the wholesale-investor tests in Schedule 1, clauses 3 to 41 of the Financial Markets Conduct Act 2013. The tests cover investment amount (large single offers), net assets and annual revenue (the "large entity" tests), professional experience (the "investment business" test), and self-certification of investment activity ("eligible investor" certificate under clause 41).
Wholesale investors can be offered managed-fund investments without the retail PDS-SIPO-OMI-QFU disclosure regime — the offer is exempt from Part 3 of the FMC Act and the offer document is a private placement memorandum or wholesale information memorandum rather than a registered PDS. Wholesale-only funds are not on the FMA Disclose register.
In NZ practice, many fund managers run a "retail PIE-fund" leg (covered on ManagedFundsNZ) and a "wholesale" leg (not covered here). The same investment strategy may be available in both forms; the wholesale form typically has higher minimum investment but lower management fee and no retail disclosure-regime overhead.
Primary sources
Related terms
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PDS
Product Disclosure Statement (PDS)
The headline legal document a NZ managed fund or KiwiSaver scheme provides to retail investors, summarising the fund, fees, risks, and how to invest.
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FMC Act
Financial Markets Conduct Act 2013 (FMC Act)
The principal NZ statute governing the issue, supervision and conduct of managed-investment schemes, securities offers, and financial-product disclosure.