The Financial Sector Conduct Authority (FSCA) recently published FSCA Communication 18 of 2020 which provides clarity on the requirements for FSPs regarding the submission of Compliance Reports and FAIS Handover Reports.
Communication 18 of 2020 explains that the FSCA did not publish any compliance reports or handover reports for 2019 or 2020, as the FSCA is developing Conduct of Business Reports that will apply to all regulated entities and replace the Compliance Reports. As a result, Compliance Reports and Handover Reports that are usually due for submission to the FSCA in terms of section 17(4)(a) of the FAIS Act, do not need to be submitted during 2020. A complete list of reports that are not required to be submitted in 2020 are contained in the Communication.
Where an FSP has outstanding Compliance Reports from date of approval up to 2018, they are still required to submit these outstanding reports. Failure to submit such reports can lead to regulatory action being instituted against these FSPs.
The Communication also provides clarity on Handover reports stating that when there is a change in the compliance arrangements of an FSP (i.e. a change of Compliance Officer), the Compliance Officer, key individual or sole proprietor does not have to complete a handover report as a result of such change. Compliance Officers are however still required to report to the FSCA on any material irregularities that are within their knowledge at the time of the Compliance Officer’s resignation from the FSP.