URGENT ACTION REQUIRED BY FSPs CONDUCTING FINANCIAL SERVICES RELATED BUSINESS WITH PRIVATE EQUITY FUNDS
Please note that FSPs who qualify and want to register for the exemption mentioned below must urgently complete the template attached to the most recent Compliance Update and forward it to firstname.lastname@example.org. Note that this registration must be completed by 1 July 2015.
As mentioned in our previous Compliance Update, section 13(1)(c) of the FAIS Act provides that a representative may not render financial services or contract in respect of financial services other than in the name of the financial services provider (FSP) of which the person is a representative. A general exemption was previously granted to the industry from compliance with section 13(1)(c). This exemption expires on 30 June 2015 and from 1 July 2015 the industry must comply with this section.
However, FSPs conducting financial services related business with private equity funds are exempted from section 13(1)(c) until 30 June 2016, provided they register the exemption with the Registrar and inform the Registrar in writing within 15 days after the change has taken place, of any change in respect of the information that was submitted for purposes of the exemption.
This exemption allows a person to render financial services or to contract in respect of financial services other than in the name of the FSP of which such person is a representative. It is applicable to those FSPs who have appointed a General Partner (or Trustee) as a representative of their licensed management company rather than licensing the General Partner directly.
Please note that FSPs affected by this portion of the FAIS Act must take two important actions in order to benefit from the exemption:
· The FSP must register with the FSB using the attached template. Registration is required in order for the Registrar to have a record of the persons operating under that exemption.
· The FSP must inform all clients (LPs in this case) in writing that it has been exempted from this section until 30 June 2016
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