New laws relating to trusts
As part of its efforts to (unsuccessfully) avoid grey listing, South Africa, at the end of 2022 promulgated the General Laws (Anti-Money Laundering and Combating Terrorism Financing) Amendment Act. This new Act amended 3 other Acts, amongst them, the Trust Property Control Act. Here’s what it did.
- Definition of “beneficial owner” (of the trust property) includes amongst others, the Founder, the Trustees and any beneficiary referred to by name.
- 11(1) The trustees are required to (e) record the prescribed details relating to accountable institutions which the trustee uses as agents to perform any of the trustee’s functions relating to trust property, and from which the trustee obtains any services in respect of the trustee’s functions relating to trust property.
- 11A (1) A trustee must –
(a) establish and record the beneficial ownership of the trust;
(b) keep a record of the prescribed information relating to the beneficial owners of the trust;
(c) lodge a register of the prescribed information on the beneficial owners of the trust with the Master’s Office; and
(d) ensure that the prescribed information referred to in paragraphs (a) to (c) is kept up to date.
- (2) The Master must keep a register in the prescribed form containing prescribed information about the beneficial ownership of trusts.
- (3) A trustee must make the information contained in the register referred to in subsection (1)(c), and the Master must make the information in the register referred to in subsection (2), available to any person as prescribed.
- 19 (2) A trustee who fails to comply with an obligation referred to in section 10(2), 11(1)(e) or 11A(1), commits an offence and on conviction is liable to a fine not exceeding R10 million, or imprisonment for a period not exceeding five years, or to both such fine and imprisonment.’’
The Amendment Act was drafted in such a hurry that every amendment ends with a statement that says that the relevant requirements will be prescribed after consultation with various authorities, so we still don’t know what is actually required.
Whilst none of it is a train smash, 19(2) does change my risk as an independent professional trustee. I will now have to ensure that the obligations are fulfilled, failing which I will have to back date my resignation prior to the obligation arising.
0 comments