SUBMISSION OF EARLY WARNING NOTIFICATIONS TO THE FSCA

In terms of Board Notice 194 of 2017 (The fit and proper requirements for financial services providers) the following financial services providers (FSPs) and juristic representatives must immediately in writing, notify the FSCA when any of the circumstances contemplated in section 49 of the Board Notice are met:

(i) a Category I FSP that holds, controls or has access to client assets or that collects, holds or receives premiums or other monies in respect of a financial product;
(ii) a Category II, IIA, III and IV FSP; and
(iii) a juristic representative of an FSPs referred to in subparagraph (ii).

Early warning notifications in terms of section 49 should be submitted to the FSCA, when:

49(1)(a) the assets of the FSP or that of its juristic representative exceed the liabilities by less than 10%;
(b) the current assets of the FSP or that of its juristic representative exceeds the current liabilities by less than 10%;
(c) in respect of a Category IIA and III FSP and juristic representatives of that FSPs, the additional assets of the FSP or that of its juristic representative exceeds the minimum requirement by less than 10%;
(d) the FSP or its juristic representative does not meet any of the requirements in this Chapter; or
(e) the FSP becomes aware of an event or situation that may or will result in the effect contemplated in paragraphs (a), (b) and (c).

(2) The notification referred to in subsection (1) must be certified by the chief executive officer, controlling member, managing or general partner, or trustee, of the FSP as the case may be.

(3) The requirements set out in subsection (1) apply, with the necessary changes to a juristic representative referred to in section 45 (1) (a) (iii), provided that the notification referred to in that subsection must be made to the FSP of the juristic representative.

(4) If any of the factors in subsection (1) arises, the FSP may not directly or indirectly make any payment by way of a loan, advance, bonus, dividend, repayment of capital or a loan or any other payment or other distribution of assets to any director, officer, partner, shareholder, related party or associate without the prior written approval of the Registrar.

Please inform ICS immediately in the event of a breach of the early warning requirements. ICS will then submit the early warning notification on behalf of clients to the FSCA via the ePortal online system.

A copy of the financial soundness requirements can also be downloaded here.

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