by Susan Edmunds
The bill, which brings advice provisions under the Financial Markets Conduct Act, has been introduced to Parliament.
It had been suggested the bill would be passed by the end of this year or early next, followed by a code of conduct being approved in August next year. The law is set to come into force in February 2019.
But financial law expert David Ireland said there was a risk of delay under the new regime, as the new government gave precedence to other work.
"Nothing changes in principle but the anticipated timeframe is now even more challenging, given competing political priorities."
Sue Brown, a lawyer and formerly head of regulation at the Financial Markets Authority, agreed that was a “real possibility”.
“Not because I sense there’s a policy difference between the parties, but because of the practicalities of government formation, portfolio allocation and assimilation among what looks likely to be a lively first 100 days policy agenda.”
Market jitters as a result of the surprise result are expected to be short-term.
But AMP head of investment strategy Greg Fleming said investors should note the result reflected a degree of disenchantment with the status quo.
“The incoming New Zealand Government is not wedded to the conventional economic consensus, and may well experiment more profoundly with alternatives than some have expected.”
He said the dollar would likely be lower, bond yields could improve and equities could be headed for a “change in market leadership rather than outright correction.”
“Companies with construction and infrastructure (telecom/IT/utilities) are likely recipients of greater contract spending. Public-private partnerships (PPP) may also develop further, if pragmatism about getting results prevails over ideological objections to the PPP model.
“Healthcare and elderly care companies are potentially major beneficiaries from higher social spending and a focus on older citizens’ needs. Experiments with new funding models are probable and will create opportunities for investors alert to the ‘ageing demographic’ theme.”
ASB wealth economist Chris Tennent-Brown said a change of government might have had more impact if Labour had not shunted any capital gains tax to the next political term.
One area of uncertainty is the Reserve Bank’s Policy Targets Agreement. Labour has signalled that it wants to add employment to the Reserve Bank aims. Peters has also signalled he wants to widen its mandate. That could cause uncertainty for international investors eyeing this country.
“Any change to the PTA, the details of that will be interesting,” Tennent-Brown said.
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