FAIS Circular 4 of 2014 will be of great value to regulatory exam (RE) candidates who need to take into account recent legislative changes. It is of equal importance to all FSPs who are required to update their knowledge in order to remain compliant.
The circular provides an overview of the amendments made to the FAIS Act by the Financial Services Laws General Amendment Act (FSLGA) and the motivation for the amendments. All changes are effective from the 28th of February 2014, except for Section 13(1)(c), which is effective from the 30th of May 2014.
In terms of FAIS Circular 3 of 2014, RE candidates who write from 14 April 2014 are required to take into account changes in the Act.
The 38-page document may look daunting, but a substantial portion of the amendments refer to the abolition of the advisory committee, and the fact that notifications may henceforth be published on the official FSB website, rather than in the Government Gazette. A copy of the actual Financial Services Laws General Amendment Act is also attached to the circular.
Some observations from the Matrix
- The motivation for scrapping of the advisory committee is indicated as a step “…to further enhance the independence and impartiality of the Registrar.”
- Provision is now made for “…publication of administrative actions and notification of official acts on the FSB website, instead of in the Gazette. This is consistent with the Interpretation Act, will result in significant cost savings and more effective communication and publication.”
- A new Section 8A makes continuous professional development a specific fit and proper requirement. Included in such learning is, naturally, staying abreast of legal changes such as those contained in this circular.
- A number of the amendments concern compliance officers, including stricter control by the FSB of such persons, and clarity on their appointment criteria and fit and proper requirements.
- The maximum penalty for a transgression of the Act was increased from R1 million to R10 million. The maximum prison sentence of a period not exceeding 10 years remains unchanged.
- Three new sections on business rescue, sequestration/liquidation and directives were inserted as part of the amendments.
Finally, please note the disclaimer by the FSB, contained in FAIS Circular 4 of 2014, which warns that the Matrix of amendments is for general information purposes only, and that the Financial Services Laws General Amendment Act, a copy of which is attached to the circular, should be used for reference purposes.
Please click here to download FAIS Circular 4 of 2014.