FSCA PUBLISHES DRAFT EXEMPTION FROM CERTAIN FIT AND PROPER REQUIREMENTS
During 2017, new classes and sub-classes of insurance business were introduced via the Insurance Act, 18 of 2017 (‘Insurance Act’). Subsequently, the Determination of Fit and Proper Requirements for Financial Services Providers, 2017 (‘Fit and Proper Requirements’) was amended to ensure alignment between the subcategories of financial products contained in the Fit and Proper Requirements and the new classes and sub-classes of insurance business under the Insurance Act. To read the notice of amendment, click here.
It was, however, recently identified that some of the reclassifications that took place under the Insurance Act inadvertently resulted in certain complications in the context of the Fit and Proper Requirements, specifically relating to credit life products and funeral products. The effect of the above is that certain FSPs are not authorised to render financial services in respect of the reclassified subcategories of financial products. Consequently, such FSPs, their key individuals and representatives do not comply with some of the competence requirements applicable to the relevant subcategories of financial products.
These complications were unintentional and should not prejudice FSPs, key individuals, representatives, or clients. As such, the FSCA has decided to afford a temporary dispensation to all affected persons to facilitate and ensure a fair transition to the new classification of financial products.
To read the FSCA Communication containing the draft exemption, click here.