| (1) | A product provider must, prior to an investor investing in a tax free investment and for as long as that investment continues, comply with the disclosure requirements prescribed under the Financial Advice and Intermediary Services Act, 2002 (Act No. 37 of 2002), irrespective of whether the product provider is subject to compliance with those requirements of that Act. |
| (2) | Where a tax free investment has a fixed term but no guaranteed return, a product provider must disclose to an investor in a manner that is readily understandable by that investor all charges, fees or similar costs payable— |
| (a) | directly or indirectly by the investor out of any amount forming part of the assets underlying the tax free investment; and |
| (b) | implicit in the trading or holding of any derivative instrument or other assets underlying the tax free investment. |
| (a) | any amount in respect of the tax free investment is exposed to an index that is comprised in whole or in part of the prices of traded financial instruments; and |
| (b) | income that would otherwise accrue to the owners of those assets is not taken into account in the calculation of the index, |
an issuer must disclose to the investor that—
| (i) | the income that would otherwise accrue to the owners of those assets does not accrue to the investor, and |
| (ii) | the amount of that income referred to in paragraph (i). |
| (4) | When an investor invests in a tax free investment a product provider must inform the investor of the annual contribution limit, the lifetime contribution limit and the consequence of exceeding that limit as contemplated in section 12T(7) of the Income Tax Act in the terms and conditions of the agreement with the investor. |
| (5) | If a tax free investment consists of a financial instrument or policy with a fixed term and a guaranteed return the product provider must disclose to the investor prior to investing in that tax free investment the rate of return of that tax free investment as calculated in accordance with regulation 10A. |
[Regulation 6(5) inserted by regulation 5 of Notice No. R. 309, GG 40758, dated 31 March 2017]
