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Reserve Bank of New Zealand (Covered Bonds) Amendment Bill (Consistent) [2012] NZBORARp 13 (27 April 2012)

Last Updated: 27 April 2019

Reserve Bank of New Zealand (Covered Bonds) Amendment Bill

27 April 2012 ATTORNEY-GENERAL LEGAL ADVICE

CONSISTENCY WITH THE NEW ZEALAND BILL OF RIGHTS ACT 1990: RESERVE BANK OF NEW ZEALAND (COVERED BONDS) AMENDMENT BILL


  1. We have considered whether the Reserve Bank of New Zealand (Covered Bonds)

Amendment Bill (PCO 15803/12.0) (‘the Bill’) is consistent with the rights and

freedoms affirmed in the New Zealand Bill of Rights Act 1990 (‘the Bill of Rights Act’). We understand that the Bill will be considered by Cabinet Legislation Committee at its meeting on Thursday, 3 May 2012. We also understand that the Bill is likely to be subject to further minor amendments before it is submitted to Cabinet, and we will provide you with further advice should this prove necessary.

  1. The Bill amends the Reserve Bank of New Zealand Act 1989 to establish a legislative framework for covered bonds. A covered bond is a dual-recourse instrument under which bond-holders both have an unsecured claim on the issuing bank and hold a secured interest over a specific pool of assets, called the cover pool. The main objective of the Bill is to provide legal certainty as to the treatment of cover pool assets in the event that an issuing bank becomes insolvent. The secondary objective of the Bill is to improve investor confidence in New Zealand covered bond issues by providing independent verification of information provided by issuers about cover pools.
  2. We have concluded that the Bill appears to be consistent with the rights and freedoms affirmed in the Bill of Rights Act.

Melanie Webb

Acting Chief Legal Counsel Office of Legal Counsel

In addition to the general disclaimer for all documents on this website, please note the following: This advice was prepared to assist the Attorney-General to determine whether a report should be made to Parliament under s 7 of the New Zealand Bill of Rights Act 1990 in relation to the Reserve Bank of New Zealand (Covered Bonds) Amendment Bill. It should not be used or acted upon for any other purpose. The advice does no more than assess whether

the Bill complies with the minimum guarantees contained in the New Zealand Bill of Rights Act. The release of this advice should not be taken to indicate that the Attorney-General agrees with all aspects of it, nor does its release constitute a general waiver of legal professional privilege in respect of this or any other matter. Whilst care has been taken to ensure that this document is an accurate reproduction of the advice provided to the Attorney-General, neither the Ministry of Justice nor the Crown Law Office accepts any liability for any errors or omissions.


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