The Role of Trader Purpose in New Zealand’s Market Manipulation Regime: FMA v. Warminger

33 Pages Posted: 12 Jul 2019

See all articles by Thomas Probert

Thomas Probert

Victoria University of Wellington, Faculty of Law, Student/Alumni

Date Written: July 5, 2017

Abstract

The decision of Financial Markets Authority v Warminger [2017] NZHC 327 is now the leading case on trade based market manipulation in New Zealand. This paper focuses on Venning J’s interpretation of s 11B of the Securities Markets Act 1988, in that case. His Honour concluded that “trader purpose” is a relevant consideration when establishing a breach of s 11B, despite there being no mention of trader purpose in the wording of the provision. This paper seeks to re-evaluate Venning J’s assessment of the legal requirements under s 11B, by way of a statutory interpretation exercise. While such exercise confirms that trader purpose is indeed a relevant consideration to establishing a breach of s 11B, this paper also challenges his Honour’s method of assessment of trader purpose. An alternative framework to be used in the assessment of trader purpose is proposed. The trader purpose analysis and the proposed framework will continue to be relevant under the recently-enacted Financial Markets Conduct Act 2013.

Keywords: 'Financial Markets Authority v Warminger', 'market manipulation', 'trader purpose', 'Securities Markets Act 1988”, “Financial Markets Conduct Act 2013'

JEL Classification: K00

Suggested Citation

Probert, Thomas, The Role of Trader Purpose in New Zealand’s Market Manipulation Regime: FMA v. Warminger (July 5, 2017). Victoria University of Wellington Legal Research Paper , Available at SSRN: https://ssrn.com/abstract=3415250 or http://dx.doi.org/10.2139/ssrn.3415250

Thomas Probert (Contact Author)

Victoria University of Wellington, Faculty of Law, Student/Alumni ( email )

PO Box 600
Wellington, Victoria 6140
New Zealand

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