30 January 2009

J Steele
NZX Regulation
NZX Limited
PO Box 2959
Wellington NZ

By e-mail to: joshua.steele@nzx.com

Dear Joshua

NZX CONSULTATION, DECEMBER 2008 - SIA SUBMISSION

This submission has been prepared by an SIA representative sub-group (the “SIA Group”)
formed to undertake an industry review of the proposed rules and procedures set out in the
consultation paper entitled “NZX Participant Rules, Participant Consultation Paper, December
2008” (the “Consultation Paper”). The SIA Group comprises representatives from ABN
AMRO Craigs Limited, ASB Securities Limited, Direct Broking Limited, First NZ Capital
Securities Limited, Forsyth Barr Limited, Goldman Sachs JBWere (NZ) Limited, Macquarie
Securities NZ Limited and UBS New Zealand Limited.

Concerns regarding quality of process and review

The SIA Group is disappointed by the poor quality of the Consultation Paper in terms of:
• the number of drafting and reference errors;
• inconsistencies;
• duplicate provisions which differ within and between rule sets;
• confusing and at times incomprehensible provisions; and
• substantial omissions.

In addition, the introduction to the Consultation Paper states that the reason for the new rule
sets is for “changes that a Central Counter Party model and derivatives market brings”.
However, the bulk of the amendments, including those that have substantial cost, practical
application and implementation issues, do not fall within those parameters. These additional
proposed amendments are not identified as amendments and are absent any guidance as to
the policy reasons or any justification for them.

The poor quality of the Consultation Paper, the lack of identification of the proposed
amendments and a policy rationale for them and the compressed timeframe for market
feedback over a holiday period provided by NZX has compromised the SIA Group’s ability to
provide comprehensive and considered feedback on the Consultation Paper. Without
diminishing the significance of the feedback provided, this letter and the attached tables
should be read in that context.

In view of the separate work stream and feedback by NZX Participants to NZX on capital
adequacy, this submission does not include comment at length on the proposed changes to
the capital adequacy rules.

Timeliness of the review

The SIA Group is concerned about the timing of the Consultation Paper and the timetable for
implementation of the proposed amendments, given our understanding that:
 • there is currently no broad industry agreement as to the desirability to implement a
central clearing house at this time;
• there is no agreement as to the timeframe for implementation (if at all) of a central
clearing house,
• there is no clarity and further delay regarding certain of the IT systems for a central
clearing house;
• the most up to date estimate for full implementation of the Financial Advisors Act
(“FAA”), and regulation of financial advice, being up to 5 years away;
• there is no certainty as to what the FAA requirements will involve;
• there is no certainty that NZX will have a role in regulating “advice” or retaining
Advising Rules in any form following implementation of the FAA;
• the changing legislative landscape in other areas that will have substantial impact on
the regulatory landscape and NZX’s role and scope of regulation, e.g. anti-money
laundering legislation;
• the time frames provided add risk that any amendments implemented will have
unintended and unconsidered effects on an already fragile market; and
• the great premium attaching to attaining certainty in business in these volatile times.

The SIA Group recommends that this review of the NZX Participant Rules be reconsidered,
delayed and implemented only to the extent there is broad agreement or as required to
support the introduction of the proposed changes to Clearing and Settlement, when this
occurs. The risks associated in rushing amendments to the NZX Participant Rules exist for
participants, the market and for NZX. There is no need to rush and we strongly wish to avoid
the consequences of errors arising from an unnecessarily hasty process.

Further information

The SIA Group requests NZX to provide the following additional information:
• A list of existing NZX Participant Rules that have been removed entirely and
explanation as to the basis for each of these omissions;
• A list of existing NZX Participant Rules that have been amended, the nature and
details of the amendment and an explanation as to the basis of each of these
amendments;
• A list of newly proposed rules and procedures and an explanation as to the basis of
each of the newly proposed rules and procedures; and
• A list of what practices permitted by existing NZX Guidance Notes are not reflected in
the proposed procedures and an explanation as to the basis for each of the proposed
exclusions.

Without this additional information, the SIA Group has had to attempt to identify each
omission and amendment and then guess the reason or policy intention behind the omission
or amendment. This has only added to the time required in undertaking the review of the
Consultation Paper and increased the risk of missing material omission and amendments. In
addition, this has the effect of requiring the SIA Group, and the other participants provided the
Consultation Paper, to justify why a proposed amendment should be questioned rather than
NZX justifying the proposed amendment. NZX is responsible for drafting and maintaining its
conduct rules, and while the SIA Group acknowledges NZX’s intention of getting early
feedback from participants, the poor quality and lack of explanation or policy justification for
the proposed amendments, has shifted the responsibility for drafting, quality control and work
across to participants.

Stand alone rule sets

The existing NZX Participant Rules are divided in chapters and includes a chapter which
clearly sets out which types of participants must comply with which chapters (or parts of
chapters) of the NZX Participant Rules. The SIA Group is confused as to what NZX believes
it is achieving in creating stand alone rule books (i.e. one for Advising Participants, one for
Trading Participants and one for Primary Market Participants). In substance, what is the
difference between the varying participant types complying with separate chapters and the
varying participant types complying with different rule books? If there is no difference then
why are participants being put to the time and expense to effect the change?

In addition, the disaggregation of the existing chapters of the NZX Participant Rules into the
separate proposed rule books has not been achieved. The proposed rule books remain
reliant on definitions in other rule books, commensurate provisions in the different rule books
are not consistent and rules relevant for one type of participant are in rule books for other
types of participants which are totally unrelated to the other participant type. Where there are
differences and commensurate rules in separate rule books are not identical, will NZX’s stated
non-cumulative applicability apply?

It is also difficult, given the quality of the document and absent identification and policy
rationale for proposed amendments, to know whether some of the amendments, omissions
and differences between rule books are in fact intentional, notwithstanding NZX stated at the
meeting of 14 January 2009 that such amendments, omissions and differences are
intentional.

Rules v Procedures

Under the Securities Markets Act 1988 (the “Act”), under which NZX gains authorization from
the Securities Commission to operate a registered exchange, NZX must operate the
registered exchange with conduct rules that include the matters set out in section 36H of the
Act. Under section 36H(b) of the Act, conduct rules for a registered exchange must “include
rules that govern the conduct of business on that market and persons authorized to undertake
trading activities on that market”.

The SIA Group is concerned that substantive matters, fundamental to regulation of the market
and its participants, have been transferred to procedures. In the Consultation Paper, NZX
states that it “has removed procedural provisions and operational detail from the rules and
placed them in Procedures”. However, it is much more than mere operational matters that
have been transferred to procedures. What is the intention for such removal and transfer?

In splitting out the existing NZX Participant Rules into rules and procedures it is not clear
whether NZX intends both the rules and procedures to be “conduct rules” under the Act. If not
and only those provisions set out in the rules are to be conduct rules governed by the Act, it is
unclear to the SIA Group whether NZX will have complied with its obligations under the Act.
Will their exclusion as conduct rules affect NZX’s registration of its markets under the Act?
Will such procedures be enforceable by either NZX or its participants?

Voice recording

The SIA Group is not supportive of the proposal to make voice (telephone) recording of all
oral orders and advice compulsory for NZX Trading Participants.

The Consultation Paper cited two reasons for the proposal but lacked fundamental policy
detail to justify the proposed change. At the meeting on 14 January 2008, NZX indicated that
a desire for voice recording also stemmed from discussion between NZX and the Securities
Commission on efforts to deal with potential market abuse. If that is also a factor behind the
proposal, then it also needs to be properly set out in consultation which can then be
responded to by the SIA Group amongst others.

Notwithstanding the above, set out below are the reasons for not supporting the proposal.
Firstly, the SIA Group is not convinced as to how telephone recording of orders will mitigate
the potential for loss on inaccurate derivatives order entry. The market practice (and current
requirement under NZX Participant Rule 11.12.3) for all telephone orders to be read back to
the order placer as confirmation of the order negates any need for voice recording. Were
there to be any error by the order taker at the time, reading back the order (to the order
placer) at the time rightly gives the order placer opportunity to correct the position and for the
order taker to again confirm back the order as correct before then acting on it. Further, the
contemporaneous making of a written and/or electronic order record at the time provides a
sufficient audit trail of the confirmed order. Telephone recording is therefore unnecessary. At
best, telephone recording can be regarded as supplementary only. That does not, however,
provide justification for such a supplementary record.

Secondly, NZX has stated that concerns arise frequently in complaints and the ability of NZX
to resolve the complaints. Further, NZX has stated that “Loss arising from inaccurate order
entry is already the subject of complaints made to NZX, and NZX considers that it is not
always ideally placed to resolve such complaints”. It would be helpful to the SIA Group to
understand how many complaints by number that involved alleged erroneous verbal order
records NZX is referring to in the Consultation Paper, and the total amount of the alleged loss
in each case. This is, we believe, relevant to any cost-benefit analysis, which NZX has not
undertaken and which is commented upon further below. We believe there is no significant
underlying problem that requires attention and believe NZX has failed to make a considered
judgment or sound analysis.

Whilst NZX has the power to consider complaints, the SIA Group is of the view that the role of
NZX is not to resolve complaints or direct how they be resolved. As the SIA Group
understands it, under the existing regulatory structure, complaints resolution is a matter
between NZX Participants and clients also taking account of relevant commercial terms in
place with the client.

At the meeting on 14 January, NZX confirmed that no cost-benefit analysis had been
undertaken by NZX on the proposal. At the meeting, NZX made general unsubstantiated
statements that the cost of voice-recording technology had come down in recent years and
that most participants could simply turn on systems already available to them at minimal cost.
The failure of NZX to undertake any cost-benefit analysis for the proposal and the potential
significant costs to NZX Participants is of great concern to the SIA Group. The SIA Group is
of the view that the up-front combined cost of the NZX proposal across NZX Trading
Participants will be millions of dollars. Voice recording technology is expensive and the cost
will be greater for those firms with multiple office locations. The annual costs of maintenance
and storage, and the periodic costs of technology updates and replacements and the costs of
searching recordings (which might, for example, include a search for all conversations with a
specific client) and collateral costs (such as, for example, the costs of searching recordings
and having legal advisers review the resulting recording to comply with requests for
discovery) are also relevant and will be in addition. The Consultation Paper and the proposed
rule and procedure do not refer to the installation of recording facilities for BCP purposes; the
potential cost of which is not included in the SIA Group preliminary cost estimate above.

Thirdly, it is unclear from the proposal how long such recordings are to be retained. The
Consultation Paper refers to a period of three months whereas the proposed rule states 10
business days. Several practical issues also arise from the proposal. In particular concerns
arise on how mobile phone conversations are to be affected, how orders given by a client in a
face-to-face meeting are to be handled and how advice given to a client in a meeting are to
be handled. These were not addressed by NZX in the proposal or sufficiently in the meeting
on 14 January.

The SIA Group is of the view that the proposal does not pay sufficient regard to the
international nature of financial services and markets and the desirability of maintaining the
competitiveness of the New Zealand marketplace as a location for the broking industry. Other
developed markets do not have a blanket voice recording obligation and none, based on
analysis thus far, have scope that extends to verbal advice. For example, there is no general
recording obligation in Australia, although ASX Rules require recordings of client orders in
Futures Market Transactions (as defined in ASX Rules (and which definition excludes
warrants and options)) to be held for 3 months, and no general recording obligation in the
U.S. although obligations do apply in certain circumstances. Certain European and Asian
jurisdictions do have some form of recording obligation, others do not. The SIA Group
considers that the cost of the proposal to NZX Participants may be a significant impediment to
the introduction of a derivatives market in New Zealand.

There is an inherent NZX policy inconsistency in the proposed mandatory recording rule for
NZX Trading Participants and the proposed voluntary recording rule for NZX Advising
Participants (who are also not Trading Participants) which, in the view of the SIA Group, runs
contrary to the reasons stated by NZX for mandatory voice recording. NZX Advising
Participants take verbal orders and give verbal advice to clients, which by the nature of their
business model will predominantly be Retail Clients (as currently defined), and yet it is
proposed that not only is voice recording optional but that there is no rule on client order
(which may include orders in derivatives) records.

The SIA Group considers that voice recording should remain a commercial choice for NZX
Trading Participants and not something that is an additional and ongoing cost and
administrative burden compelled by regulation.

Should it be necessary, SIA will comment more fully on this topic in the public consultation
process.

NZX regulatory creep of powers

The SIA Group is disappointed that NZX has taken this opportunity to make additional
amendments to the NZX Participant Rules that do not fall within NZX’s stated parameters of
its review which have the effect of incrementally increasing NZX’s regulatory powers. Some
such proposed amendments may have little perceived effect (however we note given the
limited time to review the Consultation Paper, we do not believe full consideration will have
been had to the flow on effects of such an amendment) but again no justification for the
proposed amendments are provided. Yet other proposed amendments, while affected by
minimal drafting changes, involve major policy changes with substantial implementation costs
and risks associated with them. For example, NZX proposes to extend its regulatory powers
to enable NZX to dictate the structure and amount of insurance cover for a participant,
notwithstanding that that participant is already required to have such insurance in place
1
appropriate having regard to its business . In addition, NZX proposes to extend its regulatory
powers to regulate likely breaches of the rules of other exchanges, the terms and conditions
of subordinated debt and media comment on matters of finance and the financial services
industry generally.

This extension of NZX’s regulatory powers is proposed at the same time NZX proposes to
absolve itself of any liability for its extended regulatory oversight.

There are also changes which appear to have no effect but which will cause participants time
and money to implement. For example, changing the description of “Responsible Executive”
to “Responsible Person” requires a review of all documents including internal policy
documents, delegated authorities, authorized signatory lists etc that refer to “Responsible
Executive” and updating them for the change in term (that has not actual effect). The SIA
Group can only guess at what liability may flow from missing amending such documentation
or notifying third parties of the change and is, again, frustrated by NZX’s inability to consider
the practical effect of its proposed changes on participants and the industry.

1
Further comments on the amendments to the insurance requirements are set out below.
Know your client

The SIA Group is not supportive of the proposed changes to the Know Your Client (“KYC”)
rules suggested at draft Rule 4.5 and Procedure 4.1.2 of the Advising Rules (Information that
must be obtained from the Client unless that Client is a Habitual Investor; being Investment
Objectives, Annual income/salary, Net Worth, Experience investing in Securities Markets and
Alternative Contact Details). The policy basis for the proposed change was not set out in the
Consultation Paper, however absent of that the SIA Group sets out the following preliminary
views.

In practice, as recognized in the existing rules, the reality is that information can (and must)
be sought but a client may elect not to provide such information and many do not. In
particular, whilst clients might denote their investment objectives and level of acceptable risk,
many do not, for example, also disclose information about their financial situation, be that
income/salary, net worth or other financial information. The step to appropriately address this
is a risk warning to the client that where they seek investment advice but do not disclose part
or any of the requested information, then the advisor can only provide advice and/or make
recommendations based on the information provided (if any) and the advisor will therefore be
limited in their ability to give advice or make recommendations specific to the client. This is
generally supported by a suitable advice disclaimer in client agreement terms and therefore
provides a suitable level of protection, importantly firstly to the client and the NZX Participant
concerned. The SIA Group considers the risk warning is fundamental.

In terms of discretionary accounts it is of course accepted that no discretion can be exercised

without the client having entered into a written discretionary mandate, which by necessity
must, at minimum, include investment objectives, risk profile and any applicable investment
restrictions (“account parameters”). That a discretionary client might not disclose information
about their financial circumstances does not in practice impact suitable management of their
portfolio in accordance with those account parameters. The proposed change would have the
effect of prohibiting continued management of the client’s portfolio absent of the client’s
investment history, income, net worth and alternative contact details.

The proposed changes do not appear to take account of execution-only service arrangements
or execution-only transactions. Further, we question the proposed need for alternative contact
details. Where a firm has obtained residential address and telephone contact details and,
where relevant, mobile phone and electronic mail details, we cannot see how any alternative
contact information can be relevant to the services to be provided or in real terms provide any
additional benefit to a firm in a commercial dispute, for example, a situation where a client
might default on their contractual obligations. The procedure as currently drafted does not
provide for the fact that clients may not have alternative contact details.

Moreover, in a broader context we do not consider it necessary to make any changes to the
existing KYC rules which are long-established, well-understood and work well. In 2003/4 NZX
Participants went to considerable lengths and cost to implement changes to comply with the
then new KYC rules, including major changes to client agreement terms, seeking information
from clients and entering into written client agreements. If implemented, the proposed change
would require NZX Participants to re-seek information from clients, update client agreement
terms and new account opening procedures and endure significant time and compliance
costs in doing so. The above-mentioned risk warning and advice disclaimer negate any need
to go to such lengths or to incur such costs. Furthermore, as emphasized to NZX at the
meeting on 14 January, no changes to the existing KYC rules should be made until pending
changes to anti-money laundering law that may introduce new prescriptive requirements on
further identifying, for example, the source of funds and/or the financial circumstances of
clients are known and subsequently come into law. At that stage, the whole financial services
industry will move to implement any change as appropriate and NZX Participants would then
be on a level playing field in terms of what information existing clients and new client
applicants are compelled to provide.

Advisor accreditation

The SIA Group is not supportive of the proposed changes to the NZX Associate Advisor/NZX
Advisor accreditation rules outlined in the Consultation Paper. Underlining this is that we do
not consider significant proposed change to the NZX Associate Advisor/NZX Advisor
accreditation regime as being necessary, and that in any event change should not be made
ahead of the FAA requirements being determined and enacted across the broader investment
advisor industry in due course.

Once known, those requirements will dictate what advisor conduct regulatory regime will
apply and what role, if any, NZX will have in regulating the conduct of advisors employed by
NZX Firms. Further, the FAA may undo the proposed NZX changes or impose new ones.
Therefore, from a cost of compliance and practical implementation perspective it makes
sense to act from a position of certainty and to see where the FAA ends up before making any
change. In the meantime, the existing rules, which are working well in providing an
appropriate threshold of advisor competency for accreditation, should remain in force.

We provide further comment below in respect of certain of the draft proposed changes.

Draft Rule 3.4 proposes that NZX Associate Advisor status is not enduring but would require
(unless an exemption under “exceptional circumstances” is granted) the full NZX Diploma to
be achieved within 2 years of accreditation as an Associate Advisor. Draft Rule 3.4.5 would
require existing Advisors to make application to NZX for transitional admittance to NZX
Advisor status and advisors have 2 years to complete the requirements to achieve NZX
Advisor status.

The existing rules in respect of NZX Associate Advisor accreditation require 6 months
supervision under an NZX Advisor and the completion of two papers specific to the New
Zealand market and New Zealand regulatory regime. Upon satisfaction of these
requirements (and submission and approval of the requisite documentation to NZX) the
individual is deemed competent to provide investment advice to clients, unsupervised. In our
interpretation, the draft Rules propose that the supervision timeframe is reduced to 1 month,
and the individual does not need to have completed any additional education requirements
other than having enrolled in the prescribed exams. Upon satisfaction of these requirements
(and submission and approval of the requisite documentation to NZX) the individual is
deemed competent to provide investment advice to clients, unsupervised.

While recognizing there will be circumstances (for example, applicants who have been
advising in overseas jurisdictions) where a reduced supervision period and/or exceptions in
respect of exam completion will be appropriate, we question whether a blanket reduction of
the requirements for all NZX Associate Advisor applicants is appropriate. We, therefore,
require clarification from NZX as to the policy basis for the proposed change. Is it NZX’s view
that competence to provide advice to clients can be achieved after only one month’s
supervised training?

The proposed changes to Advisor accreditation include an expiry date on NZX Associate
Advisor designation of 2 years. Further, during the two year period the Associate Advisor has
to complete the requirements for NZX Advisor accreditation. The existing qualification
requirement for NZX Advisor accreditation is the NZX Diploma, 6 papers currently provided by
Kaplan Educational.

In practice, the proposed changes mean that an individual can be approved as an NZX
Associate Advisor and deemed competent to practice as an advisor for a two year period,
upon the duration of which unless the advisor has completed the requirements for NZX
Advisor accreditation, they will be deemed incompetent and will be unable to practice as an
advisor. We question the sense in this and are concerned that for existing NZX Associate
Advisors in particular the proposed change may amount to an illegal restraint of trade under
applicable law. The SIA Group is of the view that achieving the minimum threshold
competency to give investment advice does not simply cease because certain additional
examinations not deemed necessary for the minimum threshold competency might not be
achieved. Whilst we agree that it is desirable for advisors to have the same base level of
examinations, they are only one part of competency. Once approved, accreditation and the
right to act as an advisor should be enduring for the accreditation class.

Limitation of liability

We refer to the limitation of liability clauses which have been inserted across the rule books,
namely, section 8.5 of the Primary Market Rules, section 12.6 of the Trading Rules and
section 10.6 of the Advising Rules.

Such a limitation represents a material proposed change in the contractual relationship

between NZX and Participants. The SIA Group considers that if NZX or its associated parties
are liable under law to Participants then that liability should stand. Please provide the policy
justification for the insertion of these clauses.

Audit procedures

The SIA Group considers that any changes to audit procedures (sections 2.21 and 2.22 of the
Primary Market Procedures, sections 2.23 and 2.24 of the Trading Procedures, sections 2.21
of the Advising Procedures) should be the subject of a separate working group which would
include the major audit firms.

As currently drafted, we do not believe audit firms would sign off on the matters indicated. If
Participants were required to provide the certificates as required, we consider it would
substantially increase compliance costs for Participants. We conservatively estimate that it
could increase annual audit costs to Participants by at least $100,000 but that this amount
could be a good deal greater. In addition, the initial audit under such procedures would
require Participants to educate the auditors which could see an increase in audit costs of
$500,000 for that year.

Please advise whether NZX sought input from audit firms in the drafting of these sections
and, if so, what increased audit costs Participants could expect as a result of the new
proposed requirements.

Insurance

Insurance amongst those Participants who are part of a global group is often negotiated at a
global level, taking into account all factors including “self-insurance” and parent guarantees.
In many instances, such Participants will be unable to accommodate a stipulation from NZX to
change the structure and/or increase the coverage amount for the group or for the Participant.
Participants are already required under the existing NZX Participant Rules and under the
proposed new rule books to have such insurance in place appropriate having regard to its
business. The SIA Group considers this is adequate.

In addition, we consider that Participants are in a better position to judge the adequacy of
insurance cover required for their business. The SIA Group considers that the existing
insurance requirements set out in the NZX Participant Rules simply be carried over to each
rule book unchanged.
Client agreements

There is inconsistency in the rules and procedures regarding whether institutional clients are
required to enter into client agreements with participants. At the meeting on 14 January NZX
stated that it was intended that agreements would not be required from institutional clients.
The SIA Group requests that NZX amend the rules and procedures accordingly.

Contract notes

Again, at the meeting on 14 January NZX stated that it has not anticipated any changes to the
information and disclosures to be made to clients in contract notes and yet the rules and
procedures have proposed changes to the existing rules and do not provide for certain of the
appropriate generic disclosures rightly recognized in existing Guidance Notes. As currently
drafted, the proposed changes have potentially far reaching and costly system implications.
The SIA Group requests that NZX amend the rules and procedures (in particular to reflect
existing guidance in this area) accordingly.

Trading records

The proposed requirement that a NZX Trading Participant captures the date and time of
execution of all orders, which by necessary implication extends to those orders executed by
agents on overseas markets, is, in respect of overseas orders, onerous, will involve
unnecessary cost, achieves nothing and will be reliant on the co-operation of the executing
agent to provide those records. Any overseas order execution queries are currently
adequately dealt with by participants on a case-by-case basis with execution agents and
therefore execution date and time can be obtained on such inquiry, as necessary. Again, at
the meeting on 14 January NZX indicated that the intention of the proposed rule was not to
create a compliance burden in this area. Accordingly, the SIA Group requests that NZX
amend the rule and procedure accordingly.

Tax statements

At the meeting on 14 January NZX provided no basis for the proposed reduction to 30
business days of tax-year end as the date by which tax statements had to be provided to
applicable clients. As partly reflected in the existing rule, applicable taxation law and IRD
deadlines must and can only apply. The SIA Group, therefore, restates that the amendment to
30 business days arbitrarily proposed by NZX contradicts IRD requirements, is unrealistic in
practical terms and not achievable in what is a highly complex area. Further, NZX
participants must be under no greater burden in this area than other financial services
providers.

Transitional provisions

It is unclear how NZX intends to transition from the existing NZX Participant Rule obligations
to the new rule book obligations. For example, will existing clients who have complied with
the NZX Participant Rule requirements for client account opening documentation be required
to provide additional documentation to comply with the new and different rule book
requirements? NZX needs to provide clarity as to its intended approach.

Conclusion

The short time period provided to the SIA Group, and participants more broadly, to read the
Consultation Paper, identify issues, obtain feedback from various business units affected by
the proposed changes and consider those issues and in many cases the far reaching
implications of those proposed changes has inhibited the SIA Group’s ability to provide
considered and fulsome feedback across the attached tables. While the SIA Group has made
every effort to be consistent and fulsome in its feedback, where issues have been identified in
feedback on one rule book (as set out in one table) that apply equally to the other rule books,
that same feedback applies across each rule book (and each table) notwithstanding its
omission from those other tables.

Thank you for this opportunity to make this submission. We ask that NZX acknowledge
receipt of this letter and attachments and to respond in due course in writing to each matter
raised. After the next week, we would be pleased to discuss or elaborate on any of the
matters covered in our submission.

Yours sincerely

Scott St John
Chairman
SECURITIES INDUSTRY ASSOCIATION