Parliament, Wednesday 8 June 2022 – The National Assembly (NA) at its plenary sitting this afternoon has passed the Financial Sector and Deposit Insurance Levies Bill and the Financial Sector and Deposit Insurance Levies (Administration) and Deposit Insurance Premiums Bill.
The Financial Sector and Deposit Insurance Levies Bill, introduced to the National Assembly by Minister of Finance on 21 January 2022, seeks to make provision for the collection and administration of levies imposed in terms of the Financial Sector and Deposit Insurance Levies Bill of 2022. These levies will fund the operations of the Prudential Authority, the Financial Sector Conduct Authority, the Corporation for Deposit Insurance, the Financial Services Tribunal, the Ombuds Council, the Office of the Pension Funds Adjudicator, and the FAIS Ombud.
The Bill is one of the final implementing stages of the country’s financial sector regulatory reforms which introduced the so-called “Twin-Peaks” regulatory architecture - following the 2008 global financial crisis. The “Twin-Peaks” model of financial regulation is touted as a comprehensive system for regulating the financial sector, representing a radical shift away from fragmented regulation and mitigating the risk of regulatory arbitrage.
In 2021, Parliament enacted the Financial Sector Laws Amendment (FSLA) Bill which established the Corporation for Deposit Insurance (CoDI) and the Deposit Insurance Fund (DIF). These, for the first time, will ensure that depositors are protected in the event of a bank failure.
The objectives of financial sector regulation are to ensure a stable, inclusive and transformed financial sector that is a key driver of economic growth and job creation. The financial sector plays an important role of providing financial products and services to citizens, thus supporting economic activity.
The Standing Committee on Finance, having considered the Financial Sector and Deposit Insurance Levies Bill [B3-2022], reported the Bill with amendments.
The National Assembly also passed the Financial Sector and Deposit Insurance Levies (Administration) and deposit insurance premiums Bill, which was introduced into the National Assembly by the Minister of Finance on 21 January 2022.
The Bill seeks to make provision for the collection and administration of levies imposed in terms of the Financial Sector and Deposit Insurance Levies Bill, 2022.
It amends the Financial Sector Regulation Act of 2017, (FSRA) in order to provide for the administration of levies. It also provides for the imposition, collection and administration of deposit insurance premiums. It also amends the Pension Funds Act of 1956, the Banks Act of 1990, the Mutual Banks Act of 1993, and the Financial. Advisory and Intermediary Services Act of 2002, in order to align them with the FSRA of 2017, in respect to the financing of financial sector bodies.
The committee embarked on extensive public participation engagement on the Bill and written submissions were received from, the Banking Association of South Africa (BASA), Financial Intermediaries Association of South Africa (FIASA), Johannesburg Stock Exchange, Masthead, Moonstone, Outsurance, South African Insurance Association, and Wealth Tap.
The Standing Committee on Finance, having considered the Financial Sector and Deposit Insurance Levies (Administration) and Deposit Insurance Premiums Bill [B4-2022], reported the Bill with amendments.
The Bills will be sent to the NCOP for concurrence
ISSUED BY THE PARLIAMENT OF THE REPUBLIC OF SOUTH AFRICA
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