Pension Funds Act: FSCA Exemption for Retail Fund Amalgamations

Posted 15 July 2025 Written by Acts Online
Category Financial Sector

Brought to you by SA Legal Academy: The Financial Sector Conduct Authority (FSCA) has finalized an exemption for retail funds from the provisions of section 14(1) of the Pension Funds Act, No. 24 of 1956. This exemption specifically applies to the regulatory requirements surrounding amalgamations and transfers of assets and liabilities.

In terms of the Pension Funds Act, No. 24 of 1956, section 14(1) generally prescribes the minimum benefits payable to a member and the procedural requirements for the transfer of business between funds. The FSCA’s notice follows the publication of a draft exemption in April 2025, which was subjected to public consultation. Alongside the final notice, the Authority has released a comments matrix summarizing industry feedback on the proposal.

The exemption is designed to facilitate more efficient structural changes within the retail fund sector by relaxing the rigid application of section 14(1) under specific conditions. This move aims to reduce the administrative and regulatory burden associated with fund consolidations while maintaining necessary safeguards for member interests. Practitioners should note that the exemption applies specifically to the context of amalgamations and transfers as defined under the Act.

What this means for you, your business, or your clients

  • For yourself: No direct individual obligations; impact is channelled through professional advisory roles regarding fund restructuring and regulatory compliance.
  • For your business: Update internal compliance frameworks and audit procedures to reflect the new exemption status for retail fund amalgamations, ensuring that the specific conditions of the FSCA notice are met before bypassing standard filing requirements.
  • For your clients: Advise retail fund clients on the potential for expedited amalgamations and transfers, focusing on the relief from standard section 14(1) minimum benefit prescriptions where the fund meets the FSCA’s qualifying criteria.

Originally published at https://legalacademy.co.za/news/read/pension-funds-act-retail-funds-exemption-amalgamations-transfers

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