A draft Conduct Standard, setting out both the principles and fit and proper requirements that CIS managers must comply with on an ongoing basis, was released by the Financial Sector Conduct Authority (FSCA) on 2 December 2020.
The draft Conduct Standard contains requirements relating to governance arrangements; obligations of the board; directors; competence; honesty, integrity and good standing; significant owners; financial soundness; operational ability; trustees and custodians; appointment of auditors; establishment of an audit committee; conflicts of interest and complaints management; risk management and liquidity risk management; portfolio applications and approval; winding up, amendment and amalgamation of a portfolio.
The fit and proper requirements for directors have also been improved to ensure that each CIS manager appoints an executive director and to provide for clarity with regard to the meaning of an independent director. Furthermore, the draft Conduct Standard also provides for an updated complaint resolution procedure, additional conflict of interest requirements, liquidity risk management requirements as well as guidelines and requirements for the termination of portfolios in terms of section 102 of the Act. It also provides for the applications for amendments and amalgamations of portfolios.
Comments on the draft Conduct Standard must be submitted in writing on or before 15 February 2021. Click on the links to download:
|●||FSCA Communication 55 of 2020 (CIS)|
|●||Statement supporting Conduct Standard Fit and Proper Requirements for CIS|
|●||Notice Draft Conduct Standard of 2020 (CIS)|