The Conduct of Financial Institutions (COFI) Bill was published by National Treasury in December 2018 and industry was given until the end of March 2019 to comment.
The COFI Bill is an important development for FSPs as it will replace the FAIS Act as the main market conduct legislation.
There are currently 13 different financial sector laws applicable to financial institutions. These laws regulate and supervise financial institutions based on their institutional definition – e.g. banks are regulated in terms of one law, and insurance companies are regulated under a different law, even though they may perform many activities that are the same. The different sectoral laws are often implemented in a “siloed” manner. The COFI Bill will be a single comprehensive law for the regulation of market conduct in the financial sector that will be administered by the Conduct Authority. The new legal framework will shift away from this sectoral approach and the COFI Bill will define the activities undertaken in the financial sector.
Masthead has taken the opportunity to identify the potential impact that the COFI Bill will have on FSPs particularly from the perspective of Independent Financial Advisors and has made a submission to National Treasury. Once industry comments have been considered, the regulators will probably release a second version before submitting to Parliament. When the COFI Bill does become law, we expect to see the various provisions phased in, rather than implemented all at once.
Masthead members can read the full submission on Masthead Connect. Login to Connect and follow this path to read the document: For Members > MHFAA > Regulatory input by Masthead
Masthead hosts a Regulatory Update – Know the Impact Seminar* which includes information about the changes which will be introduced by the COFI Bill. Read more about the seminar here or contact your nearest Masthead Office for more information.
*Masthead members can attend this seminar at no cost.