Search for:
AML & Financial Services Regulatory

South Africa: Financial Sector Conduct Authority calls on certain Financial Institutions to provide ownership information before 30 September 2022

By 2 Mins Read

In brief

The Financial Sector Conduct Authority (FSCA) in South Africa has issued a notice to request information relating to ownership from certain financial institutions in South Africa. The required information must be submitted online by 30 September 2022, and failure to do so will constitute an offense.

In depth

The Financial Sector Conduct Authority (FSCA) has issued a notice to request information relating to ownership from certain financial institutions, namely:

  1. Authorised Financial Services Providers (FSPs) licensed to operate under the Financial Advisory and Intermediary Services Act, 2002 but excluding:
  • Banks, mutual banks and insurers licensed by the Prudential Authority.
  • FSPs authorized for non-life insurance and/or health service benefit products only.
  • Sole proprietors and partnerships.
  1. Managers administering a collective investment scheme in terms of the Collective Investment Scheme Act, 2002.

The drive to collect this information stems from South Africa’s membership of the Financial Action Taskforce (FATF), the global gatekeeper of Anti-Money Laundering/Combating the Financing of Terrorism (AML/CFT). The FSCA is, under the auspices of the FATF, required to scrutinize the ownership of its supervised entities more closely to help mitigate the risk of financial institutions being used to facilitate criminal activity.

The impacted financial institutions (FSPs and Managers) are requested to upload an organogram outlining the total ownership and control structure of the financial institution. This is to enable the FSCA to verify the ownership information.

Two levels of ownership information should be provided to the FSCA:

  • Level 1 – Direct ownership information of impacted financial institution – All ownership information relating to 100% of the direct ownership of the impacted financial institution should be submitted, regardless of the type of owner or percentage of ownership held.
  • Level 2 – Next ownership levels information (indirect ownership of impacted financial institution).

All ownership information relating to 100% of the indirect ownership of the impacted financial institution should be submitted. 

The required information should be submitted online via the FAIS e-portal for FSPs and the CIS/Hedge Fund e-portal for Managers accessible here. Once logged in, select the “Beneficial Ownership Information” option and complete all required fields.

The required information must be submitted no later than 30 September 2022. Failure to comply will constitute an offense.

Further information can be obtained here.

Categories:
Author

Ashlin Perumall is a partner in Baker McKenzie's corporate/M&A and IPTech practice groups in Johannesburg. Ashlin specialises in technology-focused matters, including M&A and venture capital transactions, and the commercial aspects of intellectual property (IP). His practice extends to advising on emerging technology business models and establishing legal, compliance or diligence assessment frameworks for novel targets in various industries, where a high degree of technical expertise is required. These include acting as key advisor to clients entering the fintech (including paytech, open banking, digital banking and financial APIs), blockchain and distributed ledger tech, AI/Machine Learning as a Service (MLaaS) in the auditing industry and digital asset sector. He has over a decade of experience is assessing emerging technology and novel IP acquisition targets. Ashlin has also worked in the Firm's London office and served as a Fellow to the World Economic Forum's Centre for the Fourth Industrial Revolution (4IR) in San Francisco as part of our partnership with the forum to address global, regional and industry policy issues in respect of 4IR technologies, conducting regulatory and policy research, and paper writing as part of the Digital Currency Governance Consortium (DCGC).

Related Posts