| (1) | No person may, as a regular feature of his or her business, undertake the management of investments on behalf of another person, and for such management receive any remuneration in whatever form, unless he or she — |
| (a) | is a person who has been approved by the Registrar or is a person who falls within a category of persons approved by the Registrar; |
| (b) | has a written mandate to do so from the other person; and |
| (c) | complies with such conditions as the Registrar may from time to time determine by notice in the Gazette, which conditions may — |
| (i) | prohibit the management of investments referred to in subparagraphs (ii) and (iv) of the definition of “investments” in subsection (7), if such investments are not subject to a regulatory regime deemed adequate by the Registrar for the protection of investors; and |
| (ii) | differ in respect of different groups or types of investment managers. |
[Subsection (1) amended by section 1(a) of Act 13 of 1998]
| (1A) | Subsection (1) does not apply to a member authorised in terms of the rules to manage investments on behalf of another person or a company which is registered as a management company in terms of the Unit Trusts Control Act, 1981 (Act No. 54 of 1981). |
[Subsection (1A) inserted by section 1(b) of Act 13 of 1998]
(2) The provision of section 17B shall apply mutatis mutandis to any person approved in terms of subsection (1).
(3) Every application for approval referred to in subsection (1) shall be made in the prescribed manner and shall be accompanied by the prescribed application fee.
| (4) | The Registrar may grant an applicant the approval contemplated in subsection (1) if — |
| (a) | the applicant is of good character and integrity, or in the case of a corporate body, is managed and controlled by persons who are of good character and integrity; |
| (b) | the applicant complies, or in the case of a corporate body is managed by persons or employs persons who comply, with the standards of training and experience and the other qualifications required by the Registrar by notice in the Gazette; |
| (c) | the applicant complies with the prudential requirements determined by the Registrar by notice in the Gazette; |
[Paragraph (c) amended by section 3(b) of Act 73 of 1996]
| (e) | the applicant undertakes to pay the annual levy prescribed under section 15A of the Financial Services Board Act, 1990 (Act No. 97 of 1990). |
[Paragraph (e) amended by section 3(c) of Act 73 of 1996]
(5) The Registrar may withdraw approval granted in terms of subsection (4) if the approved person fails to comply with the requirements contemplated in subsections (1) and (4).
(6)
| (a) | For the purposes of subsection (1) it shall be deemed that the management of investments is not a regular feature of the business of any person if such investments form part of the assets — |
| (i) | in any deceased or insolvent estate, and he is the executor, administrator or trustee concerned or is a person administering or winding up such estate on behalf of that executor, administrator or trustee; |
| (ii) | of any person under curatorship, and he is the curator concerned or is administering such estate on behalf of that curator; |
| (iii) | of a company in liquidation or under judicial management, and he is the liquidator or judicial manager concerned or is liquidating or managing such company on behalf of that liquidator or judicial manager; |
| (iv) | of a trust as defined in section 1 of the Trust Property Control Act, 1988 (Act No. 57 of 1988), created inter vivos, but not a business trust and he or she is the trustee concerned or a person administering such trust on behalf of that trustee; or |
[Subsection (6)(iv) amended by section 1(c) of Act 13 of 1998]
| (v) | of a minor, and he is the guardian concerned or a person administering such investments on behalf of that guardian. |
[Paragraph (a) amended by section 3(d) of Act 73 of 1996]
| (b) | If in any instance contemplated in paragraph (a) it is a regular feature of the business of a person acting on behalf of such executor, administrator, trustee, curator, liquidator, judicial manager or guardian to manage investments, such person shall obtain approval from the Registrar in terms of subsection (1). |
| (7) | For the purposes of this section — |
| (ii) | financial instruments listed on a foreign exchange; |
| (iii) | units in a unit portfolio as defined in section 1 of the Unit Trusts Control Act, 1981 (Act No. 54 of 1981), or units or any other form of participation in a collective investment scheme approved by the Registrar of Unit Trust Companies in terms of that Act; |
| (iv) | units or any other form of participation in a collective investment scheme licensed or registered in a foreign country; |
| (v) | any other instruments declared to be investments for the purposes of this section by the Registrar by notice in the Gazette; or |
| (vi) | funds intended for the purchase of such financial instruments, units, participation or other instruments; |
| (b) | "management of investments" means — |
| (i) | the buying, selling or otherwise dealing with investments on behalf of another person; |
| (ii) | an offer or agreement regarding such buying, selling or dealing, irrespective of whether an investment manager is required to exercise his, her or its discretion; or |
| (iii) | the implementation on behalf of another person of a decision to buy, sell or deal with investments, |
but not
| (aa) | the giving of advice on the merits of such transactions without receiving funds or assets from a client; or |
| (bb) | the performance of the functions of a company or institution which is registered as a trustee under the Unit Trusts Control Act, 1981 (Act No. 54 of 1981); and |
| (c) | “business trust” means a trust inter vivos created for the purpose of carrying on a business for profit-making, which purpose is achieved through the combination of capital contributed by the beneficiaries themselves and through the administration or management of the capital by trustees on behalf of and for the benefit of the beneficiaries. |
[Subsection (7) substituted by section 1(d) of Act 13 of 1998]
[Section 5 substituted by section 2 of Act 55 of 1995]
