To legally offer and trade in commodities in South Africa, depending on your business model, you will require one of the following licenses:
- Financial Services Provider (FSP) license: If you offer commodities (e.g. Contracts of Differences/CFDs) or providing financial advice. You need an FSP license issued by the FSCA under the FAIS Act.
- Over-the-Counter Derivatives Providers (ODP) license: Entities acting as the principal or market-maker of OTC derivatives (like CFDs) need this specific license from the FSCA.
- Physical Trade and Business license: If you are physically buying, selling, or supplying perishable or non-perishable commodities, you will need local municipal trade license (such as Certificate of Acceptability for Foodstuffs) from your local municipal Economic Development Office.
- SARS Customs and Excise Registration: If you are importing or exporting commodities you must register with the South African Revenue Service (SARS) and may need permits from ITAC.
- Specific Regulated Commodities: Specialized commodities like gold, precious metals, or petroleum require separate permits from SADPMR or the Department of Mineral Resources and Energy (DMRE).
Which licenses is required for Crypto Commodities in South Africa?
Providing advice or intermediary services for crypto commodities CFDs in South Africa requires a Category I or Category II FSP license with Category II Derivatives) authorization issued by the FSCA.
Because Cryptocurrency CFDs are Categorized as derivatives, an entity offering, advising, or facilitating trades for these instruments must comply with the FAIS Act:
- Category I FSP license: required for basic crypto asset brokerage and intermediary services (execution-only) without discretionary control over client funds.
- Category II FSP license: mandatory if the platformer broker manages portfolios or trade on behalf of clients on a discretionary basis.
- Crypto Asset Service Provider (CASP) status: Crypto Assets are formally declared financial products in South Africa, meaning platforms must also be officially recognized as CASPs by the FSCA.
- FICA Compliance: Providers must register with the Financial Intelligence Centre (FIC) as accountable institutions to enforce Anti-Money Laundering (AML) and Know Your Customer (KYC) frameworks.
For more information, contact us
Morningside Consulting and Training Group (MCTG)Consulting
Johannesburg, South Africa
