Reference guide
The 8 official FSCA Regulatory Tasks.
Every RE5 board question lands inside one of these eight task categories. Use this single-page reference to anchor your study plan — and click into any task to read the full briefing.
FAIS Act 37 / 2002
Task 1 — Regulatory Framework
The Financial Advisory and Intermediary Services Act 37 of 2002 (FAIS) is the foundational statute governing every person who renders financial services in South Africa. It establishes the Financial Sector Conduct Authority (FSCA) as the market-conduct regulator, defines who must be authorised to give advice or render intermediary services, and sets the boundary between regulated activity and ordinary factual product information.
Critical compliance requirements
- All advice and intermediary services on a 'financial product' (as defined in section 1) require FSP authorisation under section 7.
- Acting without authorisation is a criminal offence carrying personal liability for the individual and the firm.
- The Act prescribes exemptions and transitional arrangements — candidates must distinguish a genuine exemption from unlawful conduct.
- Co-regulation: the FSCA conducts market-conduct supervision while the Prudential Authority oversees solvency under the Twin Peaks framework introduced by the Financial Sector Regulation Act, 2017.
FAIS s.8 / s.9
Task 2 — Licensing of Financial Services Providers
Sections 8 and 9 of the FAIS Act, read with the Determination of Fit and Proper Requirements (Board Notice 194 of 2017), set out who may be authorised as a Financial Services Provider (FSP), the categories of licence available, and the continuous conditions under which the licence remains valid. The FSCA may grant, suspend, vary or withdraw a licence on application or on its own initiative.
Critical compliance requirements
- FSP categories: Category I (advice/intermediary), II (discretionary), IIA (hedge-fund DIM), III (administrative), IV (assistance business).
- An applicant must demonstrate personal character, competence, operational ability, financial soundness and professional indemnity at all times.
- Annual compliance reports, audited financial statements, and prescribed levy payments must be filed within published deadlines.
- Material changes (ownership, KI, business model, address) must be notified to the FSCA promptly — section 14 read with the Conditions of Licence.
BN 194 / 2017
Task 3 — Key Individuals (KIs)
A Key Individual is the natural person who manages or oversees the rendering of financial services by an FSP. Every FSP must have at least one approved KI for each licensed category and sub-category. The Fit and Proper Requirements impose minimum standards of honesty, integrity, competence and operational ability that must be met both on appointment and continuously thereafter.
Critical compliance requirements
- KI must hold the prescribed qualification, pass the relevant Regulatory Examination (RE1) and complete class-of-business training for every product class supervised.
- Continuous Professional Development (CPD) — minimum hours per rolling 12-month cycle aligned to the KI's class-of-business profile.
- Direct accountability to the FSCA for systemic compliance failures within the FSP.
- Departure of a KI must be notified to the FSCA, and an alternate KI plan tabled before any gap arises.
BN 194 / 2017
Task 4 — Representatives & Continuous Professional Development
A representative is any natural person who renders a financial service to clients for or on behalf of an FSP — whether under employment or mandate. The FSP carries vicarious responsibility for the conduct of every representative on its register. Representatives must meet ongoing Fit and Proper requirements including competence, supervision (where applicable) and Continuous Professional Development.
Critical compliance requirements
- Every representative must be recorded in the FSP's representative register with the date of first appointment and the product sub-categories authorised.
- Supervision plans: representatives who have not yet met experience or qualification requirements must be supervised in writing under prescribed conditions.
- CPD: representatives must accrue a minimum of 18 hours per CPD cycle (split between general, ethics and product-specific hours per Board Notice 194).
- FSP must conduct due-diligence checks (criminal record, insolvency, prior debarment) before appointing any new representative.
FAIS s.14
Task 5 — Debarment Process
Section 14 of FAIS empowers an FSP (and in certain circumstances the FSCA itself) to debar a representative or KI who no longer complies with Fit and Proper requirements, or who has contravened a material provision of any financial-sector law in a way that materially affects their honesty, integrity or competence. Debarment is a serious administrative act with lasting career consequences.
Critical compliance requirements
- Procedural fairness is non-negotiable: written notice, opportunity to make representations, reasons for the decision and a right of internal review.
- Notification: a debarment must be reported to the FSCA within five business days of the decision and recorded on the central debarment register.
- Duration: debarment remains in force until the FSCA is satisfied that the underlying conduct has been remediated and the person re-qualifies.
- A debarred person may not be appointed as KI, representative or compliance officer at any other FSP while the debarment subsists.
FICA 38 / 2001
Task 6 — Compliance, Risk Management & FICA
Every FSP is an Accountable Institution under the Financial Intelligence Centre Act 38 of 2001 (FICA) and must operate a written Risk Management and Compliance Programme (RMCP) that addresses customer due diligence, ongoing transaction monitoring, sanctions screening, and the filing of suspicious or unusual activity reports with the Financial Intelligence Centre.
Critical compliance requirements
- Customer Due Diligence (CDD) on every new client; Enhanced Due Diligence on higher-risk relationships such as Politically Exposed Persons (PEPs).
- Maintain and annually review the written RMCP, signed off by the governing body of the FSP.
- File Suspicious Transaction Reports (STRs) and Suspicious Activity Reports (SARs) with the FIC within the prescribed 15-business-day window.
- Sanctions screening against the United Nations Targeted Financial Sanctions list — both at onboarding and on an ongoing basis.
BN 80 / 2003
Task 7 — General Code of Conduct
The General Code of Conduct for Authorised Financial Services Providers and Representatives (Board Notice 80 of 2003, as amended) prescribes how every FSP and representative must behave when interacting with a client. It is the most heavily examined task in RE5 because it governs daily practice: suitability, disclosure, advertising, record of advice, complaints handling and conflict-of-interest management.
Critical compliance requirements
- Render financial services honestly, fairly, with due skill, care and diligence, in the client's interest and the integrity of the financial-services industry.
- Conduct a documented suitability analysis: identify the client's needs, objectives, financial situation and risk profile before recommending any product.
- Disclose product features, fees, commissions, monetary obligations and material conflicts of interest before the client is bound.
- Keep a Record of Advice in durable form for at least five years from the date of termination of the product or relationship.
PAJA 3 / 2000 · FAIS s.20-31
Task 8 — Administrative Justice & FAIS Ombud
The Office of the FAIS Ombud (sections 20-31 of FAIS) resolves complaints between clients and FSPs informally, fairly, economically and expeditiously. Its determinations are enforceable as a judgment of court. The Promotion of Administrative Justice Act 3 of 2000 (PAJA) underpins the procedural fairness that the Ombud and the FSCA must observe in every decision affecting a person's rights.
Critical compliance requirements
- FSPs must maintain an internal complaints procedure that is fair, accessible and free of charge, with prescribed acknowledgement and resolution timeframes.
- Six-week internal resolution window must elapse (or be waived in writing by the client) before a complaint may be referred to the FAIS Ombud.
- Ombud determinations under section 28 are binding and may be made an order of the High Court for enforcement.
- Administrative action affecting a person's rights — debarment, licence withdrawal, fine — must comply with PAJA: lawful, reasonable and procedurally fair, with written reasons on request.