Minister of Finance to forward the draft Code to the DTI for gazetting by 15 December 2015 for public comment.

In January and February 2016 certain technical guidance notes will be agreed by the Council to support the implementation of the revised Code.

The final Code is thus likely to be gazetted by the end of March next year, following the 60-day comment period plus 30 days to accommodate possible revisions agreed to on the basis of public comments received.

The current Code will be valid and applicable to members until such time as the revised Code is gazetted.

The revised Code will not be applied retrospectively as previously reported. This means that members with February or March 2016 year-ends will be able to apply the existing Code for one more reporting cycle.

We were also very pleased - and relieved – when on 25 November 2015 the Parliamentary Standing Committee on Finance (SCoF) voted on the Taxation Laws Amendment Bill, adopting Option 1, which had been favoured by ASISA and its members.

The Bill was debated in the National Assembly on 26 November and was considered by the National Council of Provinces Finance Committee on 27 November.  The National Council of Provinces passed the Bill without amendments on 1 December and the Bill was sent to the President to be signed into law. Although there is a strong probability that there will be no further changes, there can be no guarantee of certainty until the President signs the Bill into law.

As it stands, the harmonisation of the tax treatment of provident funds will proceed with effect from 1 March 2016 as originally planned. From that date, members’ contributions to all retirement funds, including provident funds, will be tax deductible up to 27.5% of their remuneration. Provident fund members will have to annuitise at least two thirds of their retirement benefits, but not any vested portions.

The vested portion is the member’s benefit that accumulated in the provident fund as at 1 March 2015. Where provident fund retirement benefits are below a new threshold of R247 500, they do not have to be annuitised.  Provident fund members who are over 55 on 1 March 2016 will not have to annuitise any part of their retirement benefit.

The ASISA Financial Sector Regulation Bill Working Group considered the Bill tabled in Parliament at the end of October 2015. A written submission was sent to the Parliamentary Standing Committee on Finance (SCoF), focusing mainly on ASISA members’ concerns about the constitutionality of several provisions of the Bill.

Senior Counsel had been briefed to assess these concerns and addressed the SCoF at the public hearings on ASISA’s behalf. SCoF will continue its consideration of the Bill when Parliament reconvenes in 2016.

ASISA submitted comments on this Bill to the Department of Justice and Constitutional Development on 27 November 2015.  The Bill creates cybercrime offences and penalties and provides for the establishment of various structures to deal with cybersecurity. 

The Bill includes financial institutions in the definition of electronic communication services providers.  This places an obligation on ASISA members to inform and assist clients in respect of cybercrime, to report offences as stipulated and to preserve data that could assist law enforcement agencies.

There is also a possibility that a large financial services group could be declared a National Critical Information Infrastructure, which will add obligations.  This declaration can, however, only be made after consultation.

It is expected that Private Sector Security Incident Response Teams are to be established, but the details around the practicalities are unknown.

ASISA has established a new Standing Committee for Cyber Security under the Technical & Operations Board Committee. The Standing Committee will act as a Computer Security Incident and Response Team (CSIRT) for the savings and investment industry to ensure compliance with the requirements in the new Bill.

Following the tabling of the Bill at the end of October, the Standing Committee on Finance (SCoF) called for comments by 9 November 2015.   An ASISA submission was sent to the SCoF and ASISA made a verbal presentation at the public hearings on 11 November 2015.

ASISA highlighted the following major concerns in Parliament:

A written response to the public comments on the draft Bill has subsequently been published as well as a Socio-Economic assessment of the Bill.  ASISA met with National Treasury and the Financial Intelligence Centre on December 1 to discuss the ASISA submission. The SCoF indicated that further written comments may be submitted to the Committee.

Members of the Financial Intelligence Centre Act (FICA) Standing Committee met with the FIC in November 2015 to obtain information about the new reporting system to be implemented from 1 April 2016. The new system is called “GoAML”.  Members are advised to access GoAML documents here

During the middle of November the FSB published a draft Determination of Conditions for Registration of Managers of Collective Investment Schemes and Determination of Fit and Proper Requirements for Directors and Managers for comment by 1 February 2016. ASISA members have been requested to submit comments by the end of this week. These will be discussed by a working group under the CIS Standing Committee.

On 20 November the FSB published a Draft Notice and an Explanatory Memorandum for Regulation 28 Conditions for Investments in Hedge Funds. The deadline for comment is 29 January 2016. Members were requested to submit comments to ASISA by 14 January 2016. The Regulation 28 Working Group in conjunction with the Hedge Funds Standing Committee will review comments and prepare a submission.

During November ASISA worked with the South African Revenue Service (SARS) on finalising the PAYE Business Requirement Specifications and the OECD Common Reporting Standards.

Proposals were also submitted on the Technical Tax Amendments for the 2015/16 National Budget cycle.

The following ASISA Standards have been reviewed and approved: 

The ASISA Consolidated Valuation Guideline has also been finalised. This guideline consolidates all the valuation guidelines per security type.

This is a reminder that the ASISA 2016 Assembly takes place at the Hilton Hotel in Sandton, Johannesburg. Please diarise the evening of Wednesday, 1 June 2016, for the welcome cocktail function and Thursday, 2 June 2016, for the Assembly. More detailed information will be made available closer to the time.

In 2015 more than 700 people participated in the Academy’s 15 learning programmes. This brings to 4 300 the total number of people who enjoyed a learning experience with the Academy since its inception.

The past year has seen more innovation from the Academy in order to provide solutions for the unique skills needs of ASISA members and other industry stakeholders. We have been particularly encouraged by the success of the Retirement Fund Trustee Education programme, made possible through a dynamic partnership with the ASISA Foundation and BATSETA.

The Academy continues to formalise partnerships with SA universities to ensure that graduates are work-ready and that varsity curricula are tuned in to the changing needs of industry. In addition to the Academy’s vibrant partnerships with UCT and TSiBA, it also joined forces with the University of Johannesburg (UJ) in 2015.

In 2016 the Academy will launch two further groundbreaking programmes. Click here for more on the Financial Markets Practitioner Learnership, which combines the evening lectures of a robust UJ academic programme with on-the-job learning in ASISA members’ workplaces once students have completed an ASISA Academy work-readiness intensive. The Academy is sourcing potential graduates for ASISA members to consider as learners but companies can also place their existing staff on the learnership to maximise their B-BBEE scorecard points.

Click here for more on the Independent Financial Advisor (IFA) Internship aimed at university graduates seeking career opportunities in the financial planning industry and established IFA practices who wish to host interns. The internship combines a work readiness programme with a 12 month internship in an IFA practice.

November is traditionally one of the busiest months at ASISA. In addition to the increased workload some of our senior policy advisers attended sessions at Parliament under very trying, and sometimes dangerous conditions, as striking workers disrupted proceedings and blocked access. We would like to thank these senior staff members for persevering and getting the job done successfully.   

Overall, 2015 has been an exceptional year. This would not have been possible without the dedicated and professional contributions from the ASISA team. We would also like to acknowledge all the member representatives who volunteered their time and expertise to serve on the various committees and work groups.

As always we are also hugely appreciative of the guidance provided by the ASISA Board.  

We would like to use this opportunity to thank our members for their valued support throughout the year. A heartfelt thank you also goes to all our stakeholders – we really value the positive and productive engagements we have enjoyed with you in 2015.

We look forward to working with all of you in 2016 and wish you a peaceful holiday season and safe travels if you are planning a trip.

Please note that the ASISA offices will be closed from Monday, 21 December, until Monday, 4 January, to allow the ASISA team to take a well-deserved break after a busy year.

Kind regards