Financial Publicity Code now fully in force | Denton

The Financial Advertising Code (“Code”) published by the Advertising Standards Authority (“ASA”) came into force on 1 March 2022 for new financial advertising and now applies to all advertisements from 1 June 2022. The code replaces the former Financial Advertising Code which was updated last year following a routine review by the ASA.

Advertising in New Zealand is regulated by the ASA Codes and its complaints handling process, operating within the regulatory framework provided by numerous laws and regulations. There are independent complaints and appeal boards for advertising in New Zealand, administered by the ASA. The majority of stakeholders in the media and advertising sector are members of the ASA, although membership is voluntary.

Code request

The Code applies to all financial advertisements and parties to advertisements, including the advertiser, agencies and the media. It is important that all financial market participants who advertise “financial products or services” are aware of this update, to ensure that their current advertising practices are compliant.

The Code takes into account legislative changes, including the modification of the definition of “Financial Advertising”, and clarifies its scope as follows:

  1. The definition of “Financial Advertising” is changed to “any message whose content is directly or indirectly controlled by the Advertiser, expressed in any language and communicated on any medium with the aim of influencing the choice, opinion or behavior of those to whom it is addressed and is intended to promote a Financial Product or Service”.
  2. “Financial Products or Services” means any product or service relating to insurance, banking, credit, investment, payment services, financial or risk management, foreign exchange or advisory services or of education.
  3. “Advertiser” is any party that controls the content of a published message or broadcast activity, directly or indirectly, in order to influence choice, opinion or behavior.

In addition, the Code sets out two principles (social responsibility and truthful presentation) and additional rules that advertisers, agencies and the media must follow when advertising financial products or services.

Social responsibility

The principle of social responsibility is observed holistically and is embodied in the spirit of the Code. Financial advertising must be prepared and placed with a high level of social responsibility towards consumers and society.

The additional rules of the principle of social responsibility require that advertising be easily understood by consumers. To achieve this, the Code provides the following guidelines:

  1. All relevant and required information must be disclosed.
  2. Care should be taken to ensure that key information disclosed is understood in proportion to the materiality of that information. The written text must be sufficiently long and clear to be readable. Spoken language should be presented clearly and at a pace that consumers can understand.
  3. Financial advice may only be included in financial advertising content from licensed individuals or entities.
  4. Financial advertising published online by entities that are not approved financial service providers must also comply with the principles and rules of the Code.
  5. Advertisers and their agents are also responsible for ensuring that user-generated comments, reviews, testimonials and endorsements comply with the Code when included in advertising.

Truthful presentation

Financial advertising must be truthful, balanced and not misleading. This principle provides two additional rules for Financial Advertisements.

The first rule reiterates principle 2 of the Advertising Standards Code (“ASC”), providing that financial advertising must not mislead or be likely to mislead, deceive or confuse consumers, abuse their trust or exploit their lack of knowledge. However, an important distinction between financial advertising and other advertising is that the general exclusion allowing obvious untruths, exaggeration, exaggeration or deliberate hyperbole should not be used with respect to financial claims. Content should not take advantage of consumers’ inexperience, lack of knowledge or financial vulnerability.

The second rule concerns the use of data. Ads may not use tests, surveys or research findings or citations from technical or scientific literature in a misleading or deceptive manner. Full guidelines for this rule are also set out in the CSA. In addition, Financial Advertising must not:

  1. Presenting unrealistic or exaggerated expectations or financial results;
  2. Provide incomplete information such that the advertisement is misleading, for example by failing to include complete information such as losses, disadvantages or risks of any investment; Where
  3. State or imply that financial products or services are safe or risk-free or underestimate the level of associated risk.

Financial advertising that uses examples of past performance should clearly state that it does not reliably indicate future performance. Technical language and statistics are acceptable, provided they are relevant and easily understood by non-expert consumers without specialist knowledge.


The purpose of the Code is to ensure that Financial Advertising is presented in a way that demonstrates a high level of social responsibility. Market participants should ensure that their financial advertising discloses all relevant information and does so in a way that fairly represents the financial product or service.

The ASA states that it is possible to violate the Code from violations of principle or spirit alone. Market participants will have to take this into account when applying the Code and ensure that there are internal procedures that monitor financial advertising before making it public. This includes compliance with the Autorité des Marchés Financiers guidelines on advertising offers of financial products and wider legal regulations such as the Conduct of Financial Markets Act 2013 and the Credit Agreements and Credit Agreements Act 2003. consumer finance.

Comments are closed.