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Licensing requirements. Key Individuals chapter 4. 2. Licensing requirements for FSp and role of ki. Source: Section 8 of FAIS Act. 37. Use of specimen mandates. Registrar must approve specimen mandates used by administrative- and discretionary FSP’s

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Licensing requirements

Licensing requirements

Key Individuals chapter 4


2 licensing requirements for fsp and role of ki

2. Licensing requirements for FSp and role of ki

Source: Section 8 of FAIS Act


37 use of specimen mandates

37. Use of specimen mandates

Registrar must approve specimen mandates used by administrative- and discretionary FSP’s

No changes or amendments can be made without prior approval of Registrar


38 obligations regarding nominee co s

38. Obligations regarding nominee co’s

Discretionary FSP cannot

exist without nominee company

Holding Company is Discretionary FSP

Discretionary FSP

Fidelity guarantees in place

  • Wholly owned by discretionary FSP

  • Holds assets for investors

  • Ring fences assets

  • Cannot incur liabilities

  • Only owes investors money

  • Has adequate insurance for theft and disasters

  • Annually submit financials to FSB

  • Failure will mean license withdrawal

Nominee Company


56 maintain license of fsp

56. Maintain license of FSP

Source: Section 7 and 8 of FAIS Act

Authorised FSP or Rep can only do business with person rendering financial services if person has been issued with a license for rendering financial services and conditions and restrictions on license allow rendering of such service

  • On license being granted registrar may impose conditions having regard to:

  • All facts and information Category of financial services

  • Category of FSP in relation to fit and proper

  • Any guidelines by Advisory Committee

Conditions may include that where KI is replaced, or new KI appointed or personal circumstances of KI changes and effects fit and proper no person can take part in management and oversight of licensee’s business

Where license granted registrar issues license authorising applicant to act as FSP in Gazette and issues copy of licence.

Registrar may withdraw license or amend condition or restriction and if new KI appointed impose new conditions and restrictions and license and issue new copy


56 impact of licensing conditions of fsp

56. Impact of licensing conditions of FSP

Source: Section 8 of FAIS Act


58 annual levies payable to registrar

58. Annual levies payable to Registrar

Levies calculated on 31 August every year and payable by 30 October in same year


57 implication if ki leaves employ of fsp

57. Implication if KI leaves employ of FSP

Source: Section 8 (4) (iii) of FAIS Act

Any change in personal circumstances of KI affecting fit and proper status will mean person cannot take part in management or oversight of FSP unless on application been approved by Registrar


59 what civil remedies and penalties can registrar impose

59. What civil remedies and penalties can registrar impose

Source: Section 18 of Financial Advisory and Intermediary Service Regulations

A person who fails to comply with these regulations is guilty of an offence and liable on conviction to a fine not exceeding R500 000 or imprisonment for a period not exceeding 5 years or both


60 actions leading to civil remedies

60. Actions leading to civil remedies

Source: Section 33 of FAIS Act

Apply for Court order restraining person

From continuing to commit act or any omission

Require person to take remedial steps

Payment for amount as compensation

Penalty for punitive purposes

Interest and cost of suit


61 report changes and profile changes

61. Report changes and profile changes

Business changes reported in 15 days

Banking

details

Shareholder

Any contact details

Business

Name

Representatives

Business

address

Compliance Officer

Auditors

Source: FAIS Introductory Provisions Definitions


62 licensing conditions for products and services

62. Licensing conditions for products and services

No one can act as rep unless

He has employment or mandate agreement with FSP


63 not meeting licensing conditions for products and services

63. Not meeting licensing conditions for products and services

Suspend license until conditions met

Withdraw license


64 implication of undesirable practice publication notification by registrar

64. Implication of undesirable practice publication/notification by Registrar

Source: Section of FAIS Act

  • FSP may not carry on business practice concerned

  • Registrar can direct that practice must be rectified

  • Registrar may not make order contemplated in Financial Institutions Act

  • FSP must rectify as directed within 60 days after direction


70 interrelationship between fsp s with co responsibility

70. Interrelationship between FSP’s with co-responsibility

Source: Section 7 (3) of FAIS Act

FSP or Rep may only conduct financial services related business with person rendering financial services if that person has a license for rendering financial services and conditions and restrictions authorises that person to render financial services


88 license conditions and restrictions

88. License conditions and restrictions

Source: Section 8 (4) of FAIS ACT

Registrar may impose conditions and restrictions on authority granted by license having regard to:

Facts and information

Category of financial services

Category of financial services providers

Advisory Committee Guidelines

After date of granting license KI replaced, appointed or personal situation changes and not fit and proper person cannot manage FSP


89 what gives rise to profile change

89. What gives rise to profile change


90 fais offences

90. FAIS offences

Source: Section 36 of FAIS Act

Contravenes or fails to comply

Makes misleading statement or conceals material fact

Gives Auditor of CO false, misleading information

Is not rep appointed or mandated by FSP and professes to be

Guilty of offence on conviction fined R1 million or 10 years imprisionment or both


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