A Financial Services Provider (FSP) in South Africa must be authorized and licensed by the Financial Sector Conduct Authority (FSCA) under the Financial Advisory and Intermediary Services (FAIS) Act.
Regulating and Governance Framework
- Core Legislation: Governed by the FAIS Act 37 of 2002 alongside the Financial Intelligence Centre Act (FIC) Act and the Companies Act. The entity must first be incorporated and registered under the Companies Act.
- Fit and Proper Requirements: Set out in Board Notice 194 of 2017, requiring honesty, integrity, and operational ability, financial soundness, ad specific professional competence.
- Key Individuals and Representative/ Compliance Officers: FSPs must appoint approved Key Individuals (Kis) to manage oversight and certified Compliance Officers/Representatives to provide financial services oversight and operational duties.
FSP License Categories
- Category I: General advisory and intermediary offing basic/transactions.
- Category II & IIA: Discretionary FSPs and hedge fund managers.
- Category III: Administrative FSPs.
- Category IV: Assistance business FSPs administering funeral insurance.
Registration and Licensing Process
* Company Setup: Register the business structure or entity as company via the Companies and Intellectual Property Commission (CIPC) and register for tax with the South African Revenue Service (SARS). This process requires at least one local director and local physical street address for international investors.
* Supporting Documents: Gather and draft all supporting documents, and application forms. This process can be very complicated and requires sound understanding of the FSCA regulations and FAIS Act.
* Timeline and Costs: Application fees range from roughly R2,697 to R16,313 depending on the license Category, with average authorization timeline of about 6 to 12 months.
We can assist prepare all supporting documents, application forms and submit them to the FSCA on your behalf.
For more information, contact us. info@mctg-consulting.co.za
