Pension Funds Act, 1956 (Act No 24 of 1956)RegulationsPart I : Requirements for Exemption in terms of Section 2(3)(a) of the Act and Related Matters |
[Heading of Part I substituted by Notice No. R. 2324 of 1993]
(1) Underwritten fund
[Heading of regulation (1) inserted by regulation 3(a) of Notice No. R. 491 of 2006]
An underwritten fund is a fund that complies with the conditions set out below:
[Words preceding paragraph (a) substituted by regulation 3(b) of Notice No. R. 491 of 2006]
| (a) | The assets of the fund shall consist only of claims against one or more insurers, except that the fund may receive, as beneficial owner, shares which have been issued, free of any consideration, to the fund, as a policyholder under a scheme by which a mutual insurer is demutualised to become a public company ("demutualisation shares"), as well as capitalisation shares allotted in respect of demutualisation shares in the place of cash dividends or otherwise ("capitalisation shares"), provided that — |
| (i) | the demutualisation shares and capitalisation shares (hereafter jointly referred to as "the shares") are held on behalf of the fund in the name of a nominee company, approved by the registrar; |
| (ii) | dividends paid in cash in respect of the shares, and the proceeds from the disposal of any of the shares, after the deduction of administration costs, are— |
| (aa) | paid on receipt by the nominee company directly, either to the demutualised insurer, or to another insurer, to be applied as a premium, free of commission, under one or more policies issued to the fund by the demutualised insurer or such other insurers, or |
| (bb) | in exceptional cases, held on behalf of the fund, in respect of funds whose only claims against the demutualised insurer consist of individual policies, in the name of the nominee company, also free of commission; |
| (iii) | then the fund ceases to have a claim - as meant in this regulation 1(a) - against demutualised insurer, the shares shall either be— |
| (aa) | transferred to one or more insurers as a premium in kind; or |
| (bb) | realised and the proceeds paid directly to one or more insurers as a premium, |
under one or more policies issued by those insurers to the fund, free of commission;
| (iv) | the nominee company annually provides to the insurer mentioned in paragraph (d) of this regulation ("administering insurer") a certificate, verified by the external auditor of the nominee company, which must include— |
| (aa) | the number of shares held by the nominee company on behalf of the fund; |
| (bb) | the dividends paid in respect of the shares; and |
| (cc) | any other information available to the nominee company relating to the shares and dividends; |
so that the administering insurer may complete the financial returns required in terms of regulation 12(2)(a), and comply with subparagraph (v) of this regulation;
| (v) | the administering insurer annually reports to the Registrar that the fund has not acquired further shares, in addition to demutualisation and capitalisation shares, as beneficial owner, in the company which issued the demutualisation shares, and the report must include particulars of any dealings in the shares, receipts of dividends, and any related transactions on behalf of the fund in the financial returns required in terms of regulation 12(2)(a). |
[Regulation 1(a) substituted by Notice No. R. 1644 of 1998]
| (b) | the payment of every benefit in terms of the rules of a pension fund shall be made solely by one or more insurers; |
| (c) | the contributions payable to the pension fund shall not be paid into a bank account of the pension fund, but shall be paid direct to one or more insurers; and |
| (d) | one insurer shall accept the responsibility to act as administering insurer for the purposes of these regulations. |
| (2) | [Regulation 2 replaced by Board Notice 61 of 2011 with effect from 1 April 2011] |
(3) [Regulation 3 omitted by Notice No. 2324 of 1993]
(4) [Regulation 4 omitted by Notice No. 2324 of 1993]
(5) [Regulation 5 omitted by Notice No. 2324 of 1993]
(6) [Regulation 6 omitted by Notice No. 2324 of 1993]
(7) [Regulation 7 omitted by Notice No. 2324 of 1993]
[Part I substituted by Notice No. R. 2324 of 1993, in effect omitting regulations 3 to 7]