Financial Markets Act: Exemption Criteria for External CCPs and TRs

Posted 06 October 2025 Written by Acts Online
Category Financial Sector

Brought to you by SA Legal Academy: The Financial Sector Conduct Authority (FSCA) and the Prudential Authority (PA) have issued the final criteria for exempting external central counterparties (CCPs) and external trade repositories (TRs) from specific licensing requirements under the Financial Markets Act, No. 19 of 2012.

In terms of the Financial Markets Act, No. 19 of 2012, the regulatory authorities have operationalised a joint standard that defines the conditions under which a foreign CCP or TR may be exempted from local licensing. This framework is specifically applicable to entities operating from foreign jurisdictions that maintain a regulatory regime equivalent to that of South Africa. The publication follows a public consultation period initiated in November 2023.

The joint standard represents a key component of Phase 2 of the joint roadmap for developing a regulatory framework for central clearing. Alongside the standard, the authorities published three documents detailing the equivalence framework, which has been under revision since February 2023. These documents provide the methodology for assessing whether a foreign jurisdiction’s oversight of financial market infrastructures meets South African standards.

Key Components of the Framework

  • Exemption Criteria: Specific regulatory benchmarks that an external CCP or TR must satisfy to bypass local licensing.
  • Equivalence Assessment: A formal process for determining if a foreign jurisdiction’s regulatory framework provides comparable outcomes to the Financial Markets Act.
  • Joint Roadmap Phase 2: Implementation of clearing mandates and the integration of external market infrastructures into the local ecosystem.

Click here to download the Joint Standard and Equivalence Framework documents.

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

  • For yourself: No direct individual obligations; impact is channelled through firm-level compliance with financial market infrastructure regulations.
  • For your business: Compliance departments must review the equivalence framework to ensure that any reliance on external CCPs or TRs for clearing or reporting is supported by a valid exemption or license.
  • For your clients: Foreign-domiciled financial market infrastructures seeking to provide services in South Africa must now evaluate their home-country regulatory status against the FSCA and PA’s published equivalence criteria to determine if a licensing exemption is applicable.

Originally published at https://legalacademy.co.za/news/read/financial-markets-act-external-ccp-tr-exemption-criteria-published

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