A REGULATORY UPDATE 2022
By Financial Intermediaries Association
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COUNCIL OF MEDICAL SCHEMES CIRCULAR
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The CMS issued Circular 26 of 2022: Brokers and Brokerages who earn commission in respect of their own health or medical scheme policies; in which they stipulated that brokers may not earn commission in respect of their own health or medical scheme policies |
| COUNCIL OF MEDICAL SCHEMES CIRCULAR 35 OF 2022 | On 27 June, the Council for Medical Schemes (CMS) issued proposals to revise Circular 20 of 2010 with regard to the appointment of a broker by a member and or employer. The CMS invited comments and suggestions from all parties to improve the Circular. Circular 20 or 2010 indicates that in Regulation 28(2), a member can appoint a new broker to replace a broker previously appointed by the member. It further states that when a member has been admitted to a medical scheme without the assistance of a broker, no other person or
entity that can represent a member acting as an agent in appointing a new broker. The proposals detailed in Circular 35 of 2022 are intended to address matters or issues which were perhaps not adequately elaborated on in Circular 20 or 2010.
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| COUNCIL OF MEDICAL SCHEMES CIRCULAR 53 OF 2022 | The Council for Medical Schemes (CMS) issued Circular 53 of 2022 requesting comment on the 2022 Low-Cost Benefit Option (LCBO) Framework Report and Risk Assessment.
The Report and Risk Assessment reflect the final consolidated inputs that were developed through a consultative process with industry stakeholders as from March 2020 |
| NON-LIFE FICA PROJECT | The FIA, with other industry associations, will now work with the FIC to ensure that we assist in increasing awareness of current FIC Act obligations, specifically reporting on suspicious and unusual transactions under Section 29 of the FIC Act and complying with financial sanctions requirements in Part 2A of the FIC Act. |
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FSCA CONDUCT STANDARD 2 OF 2022 (INS)
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The Standard sets out the requirements that cell captive insurers must comply with in order to mitigate certain conduct of business-related risks that have been identified in respect of third-party cell captive insurance business arrangements. The standard came into operation on 1
October 2022. A detailed communication has been issued to members |
| PREMUM COLLECTION | Following the latest publication from the FSCA on their Regulation Plan, it is understood that these instruments will not be progressed in the current format, meaning that this proposal will not continue as initially planned and will rather be incorporated into the development of the new framework through the transition process and will be consulted on in due course.
The exemption in relation to fees payable where premium is collected direct into the insurer bank account, is to be extended. |
| FRAMEWORK FOR UNCLAIMED FINANCIAL ASSEST | Purpose of Paper :
1. Establish the current status and extent of dormant and unclaimed assets in South Africa; 2. Establish current approaches, practices, criteria, definitions and initiatives that have been implemented or applied in South Africa in order to identify, manage and minimise dormant and unclaimed assets; 3. Consider the supervisory approaches and practices implemented by foreign jurisdictions in respect of dormant and unclaimed assets |
| EMPLOYMENT EQUITY AMENDMENT BILL | There have been no further updates on the Employment Equity Amendment Bill at this time |
| CONDUCT OF FINANCIAL INSTITUTIONS BILL “COFI” |
There have been no specific updates at this time, and it is believed that this will now only be tabled in Parliament in 2023. |
| OMNI CNDUCT OF BUSINESS RETURN | The FSCA published the long-awaited Roadmap for the roll-out and implementation of the Omni-CBR (Omni-CBR Roadmap) as well as the draft Omni-CBR template for public consultation.
The Omni-CBR is intended to facilitate streamlined cross-sectoral statutory reporting and sets out the types of conduct indicators to be reported on in the future by various financial institutions including Banks, Insurers and Micro-insurers, Investment Providers, Co-operative Financial Institutions (CFIs), Financial Services Providers (FSPs), Retirement Funds and Retirement Benefit Fund Administrators. It will form the cornerstone of the FSCA’s off-site supervisory toolkit and reflects the FSCA’s increasing focus on embedding an evidence-based and data-driven approach to regulation and supervision. |
| DECLARATION OF CRYPTO AS FINANCIAL PRODUCT | The Financial Sector Conduct Authority (FSCA) has issued Communication 30 of 2022 which is a publication of the declaration of crypto assets as a financial product together with accompanying exemption notices |