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Exchange control relief – Authorities suspend Exchange Control Circular 15/2020

In a media statement on Tuesday, National Treasury, the South African Reserve Bank (SARB) and the Financial Sector Conduct Authority (FSCA) announced their intention to review Exchange Control Circular 15/2020 issued by the SARB, following the announcement by the Minister of Finance in the Medium Term Budget Policy Statement (MTBPS) Speech on 28 October 2020.

”The review is limited to providing clarification on the scope of changes to the announcement related to the reclassification of inward listed instruments. This follows enquiries by various stakeholders having different interpretations on the extent that the Circular affects the foreign investment limits applicable to institutional investors, inter alia, retirement funds, collective investment schemes and insurers.”

As a result, the Circular issued on 29 October 2020 dealing with the reclassification of inward listed instruments is suspended with immediate effect, to reduce the scope for ambiguity related to compliance with the prudential framework for regulated funds.

It is difficult to understand how a document published by such esteemed authorities could lead to such ambiguity.

Click here to download the media statement.

Click here to read a Citywire article.

Related article: Exchange control relief – Re-classification of exchange traded funds.

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