Subject Title - INSETA

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PurposeThe application process for an FSP licence was discussed in Chapter 5. TheRegistrar will include certain conditions on every FSP licence and it is part ofthe management function of a key individual to ensure that these conditionsare met.Chapter 10 looks at these conditions and unpacks the requirements that arecontained in typical conditions. You will also gain an understanding of theeffect and meaning of suspensions, withdrawals and reinstatements of theauthorisation to carry on business as an FSP.The various offences as defined in the FAIS Act, as well as the civil remediesand anti-money-laundering controls are also discussed.It is important to know how the FAIS levies are calculated.10.1 LICENSING CONDITIONS AND RESTRICTIONS10.1.1 The impact of licensing conditions on an FSPA FSP FAIS licence also carries conditions.There are standard conditions and there are conditions specifically applicableto the FSP licence. Specific conditions include reference to the categories forwhich the FSP is authorised, as well as any other applicable conditions aboutthe fit and proper status of the key individuals who need to obtain certainqualifications within a certain period of time from the date of licensing theFSP. The licensing conditions may also include exemptions applicable to theFSP.FSPs must adhere to the conditions and must also ensure that there areadequate systems and processes in the business to ensure compliance withthe conditions. Where representatives (and key individuals) work acrossvarious (sub) products and Licence Categories, there must be internalcontrols to ensure that the financial service (or management and oversight)they provide correspond with the specific licence conditions and restrictions.192 © <strong>INSETA</strong> - Section 1 12a
A FSP may request additional product categories to be added to its licenceand it may also have more than one licence because the structure of thebusiness may be such that products are grouped together, which makes itlogical to have a specific licence for that part of the business. The FAIS Actrequires that a certified copy of the FSP licence must be displayed in aprominent and durable manner within every business premises of the FSP. 12810.1.2 Different types of conditionsThere are a few standard conditions that appear in each licence – forexample:"I. The licence authorises the licensee to carry on business in respect offinancial advisory and/or intermediary services as ordinary financial servicesprovider/discretionary FSP administrative FSP in respect of the followingfinancial product/products:________2. Further conditions/restrictions:1. The financial services provider must inform the Registrar in writing, byfacsimile or in an appropriate electronic format, within 15 days after the changehas taken place, of any change in respect of business information of thefinancial services provider as provided in Form FSP1, FSP3, FSP4, FSP9, FSP10,FSP10A or FSP11, respectively, of the Application Form which was submitted bythe provider for purposes of obtaining a licence, and in particular relating to theprovider's representatives, auditor, compliance officer or any foreign clearingfirm or foreign forex service provider involved (if any) and nominee company orindependent custodian involved or the shareholders, directors or trustees of anysuch company or custodian (if any).2. The financial services provider must at all times during the currency of theprovider's licence maintain the services of any key individual or key individualsmentioned in the information submitted on the said Application Form, and mustas regards changes in respect of such information relating to a key individual,or appointment of a new key individual, of the provider, in addition to actingalso in such cases in accordance with the procedure and time limit set out inCondition 1, also ensure full compliance with Section 8(4)(b) of the Act, theprovisions of which must be regarded as included in this Condition.3 The financial services provider must within 15 days of the datecontemplated in Section 7 of the Act, submit a copy of the register kept interms of Section 13(3) of the Act to the Registrar, and must thereafter inaccordance with the procedure and time limit set out in Condition 1, inform theRegistrar of any change effected to the details as contained in that register.4. The financial services provider must not in any manner change the name of128 Section 8(8) of the FAIS Act© <strong>INSETA</strong> - Section 1 12a 193
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LOGO TO BE CONFIRMEDFSB REGULATORY
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Table of ContentsTasksGlossary of T
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8.8 Other provisions of the general
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TasksThe material provided in this
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PurposeThe FAIS Act introduced mark
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The duties of FSPs are described in
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CATEGORY II: SUBCATEGORIES2.1 Long-
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1.5.2 AdviceThe FAIS Act defines
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The elements of „advice‟ includ
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1.5.3 Intermediary serviceLet's loo
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1.5.2 Types of financial productsFi
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FSP licences are issued for specifi
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5. To provide a financial service m
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6. To give advice means to:a) give
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PurposeThis chapter introduces the
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Example 1:CBA Financial services is
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Submitting documentsEmploymenthisto
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financial soundness requirement - t
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The person was found guilty in any
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2.3.5 Experience requirements for k
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TABLE A: CATEGORY I EXPERIENCE REQU
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Experience requirements for a Categ
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was obtained through active involve
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IF YOU…Were appointed from 1Janua
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A key individual must have already
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Key individuals fulfilling the role
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serious enough to impugn the honest
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Self-Assessment QuestionsPlease not
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) Once a key individual has been ap
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Self-Assessment Answers1. Which of
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) Once a key individual has been ap
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56 © INSETA - Section 1 12a
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PurposeChapter 3 introduces you to
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Let's look at the responsibilities
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For example, a person may have star
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3.3.3 Competency requirements for r
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We discussed the tables under 2.3 a
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Experience requirements for Categor
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The main reason for the differentia
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Regulatory examinations for represe
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The purpose of the register is to:p
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Part of the management and oversigh
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Let‟s look at a summary of the co
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c) The representative register need
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Self-Assessment Answers1. In terms
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8. The general experience requireme
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PurposeIn Chapter 4 you will learn
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TABLE ACATEGORIES 1 and IV: LEVEL O
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4.2 SUPERVISION REQUIREMENTSKey ind
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Ensure that the supervision require
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Self-Assessment QuestionsPlease not
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Self-Assessment Answers1. In terms
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PurposeBefore a juristic entity can
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Understanding the process step by s
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5.3 SECTION 13As mentioned above, S
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What must be done?The FSP must main
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Registrar, by 31/12/2013.Failure by
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It should be a condition of the emp
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4. In order to meet the requirement
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5. Section 13 imposes certain dutie
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PurposeChapter 6 gives you an overv
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Ramifications for the FSP if debarm
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All other administrative or legal p
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3. May an FSP use information obtai
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PurposeDuring the course of the lif
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In the discussion of the purpose an
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caused by or arose out of the carry
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c) within 60 days after the busines
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PurposeThe FAIS General code prescr
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of crime, money-laundering legislat
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Requirements.the existence of a spe
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Page 152 and 153: 8.4 MANAGING TRANSPARENCY AND CONFL
Page 154 and 155: Where the juristic person is neithe
Page 156 and 157: what measures were taken to avoid/m
Page 158 and 159: A provider must continuously monito
Page 160 and 161: 2. Identify the financial product o
Page 162 and 163: 1. A brief summary of the informati
Page 164 and 165: are addressed in the business-speci
Page 166 and 167: 8.8.3 Insurance 89One of the risks
Page 168 and 169: WHO? BY WHEN? WHAT?Category III pro
Page 170 and 171: a representative, the information m
Page 172 and 173: Record of advice 106A direct market
Page 174 and 175: influence the objective exercising
Page 176 and 177: 4. What needs to be disclosed to cl
Page 178 and 179: Self-Assessment Answers1. Which of
Page 180 and 181: 8. The two main requirements of giv
Page 182 and 183: PurposeThis chapter introduces you
Page 184 and 185: „compliance practice‟ means a c
Page 186 and 187: Internal compliance officer:where t
Page 188 and 189: 9.1.5 Withdrawal of a compliance of
Page 190 and 191: One of the main functions of a comp
Page 192 and 193: Internal auditors normally audit co
Page 194 and 195: Information about the FSPs adherenc
Page 196 and 197: Compliance reports must be submitte
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Page 202 and 203: the financial services business as
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Page 206 and 207: easons why the provisional suspensi
Page 208 and 209: impartial tribunal or forum. This i
Page 210 and 211: 10.3.2 Civil remediesRestrainingord
Page 212 and 213: 10.4 LEVIES PAYABLE IN TERMS OF THE
Page 214 and 215: Any contravention of or failure to
Page 216 and 217: Self-Assessment Answers1. Which of
Page 218 and 219: PurposeAs a key individual, you nee
Page 220 and 221: 11.2 EFFECT OF VOLUNTARY SEQUESTRAT
Page 222 and 223: 2. A licence of ANY FSP may lapse:a
Page 224 and 225: 5. Before sequestration, winding-up
Page 226 and 227: PurposeIn Chapter 12 you will find
Page 228 and 229: 3. The records and documentation Th
Page 230 and 231: The Registrar has certain powers in
Page 232 and 233: SummaryThe FAIS Act requires string
Page 234 and 235: 4. Section 22 of the FICA requires
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Page 238 and 239: PurposeManaging the infrastructure
Page 240 and 241: A key individual, in respect of an
Page 242 and 243: The financial statements can either
Page 244 and 245: Self-Assessment Answers1. The opera
Page 246 and 247: PurposeChapter 14 introduces you to
Page 248 and 249: Sec 19(4) states that: the auditor
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2. The financial statements must:a)
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PurposeThe FIC Act imposes certain
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Accountable institutionsThe FIC Act
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The four (4) money laundering contr
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The documents used to identify and
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In an FSB FAIS Newsletter, the FSB
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Protection of Constitutional Democr
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steps to be taken to determine and
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3. Section 21(1) of the FICA requir
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PurposeChapter 16 is the last part
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The Ombud for Financial Services Pr
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11. If the complainant is unhappy w
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the contractual or other legal rela
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Self-Assessment Answers1. The funct
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