| (a) | A fund must only hold assets and categories of assets referred to in Table 1 and must comply with the limits set out in this regulation. |
| (b) | Any portion of a fund's total assets associated with a specific category of members, or a specific member where the fund provides individual member choice, must comply with the limits in this regulation. |
| (c) | Notwithstanding (a) and (b), the portion of the total assets of a retirement annuity fund, pension preservation fund or provident preservation fund that is associated with a fund member policy, or with another contractual arrangement between the member and the fund relating exclusively to the fund's liability to a particular member (or to the surviving spouse, children, dependants or nominees of the member) in terms of the rules of the fund, entered into before 1 April 2011, need not comply with the limits set out in this regulation until:— |
| (i) | the contractual terms relating to the amount or frequency of premiums or contributions payable in terms of the policy or other contractual arrangement are amended, including where an additional amount over and above any regular contractual premium or contribution is contributed to the policy or arrangement; or |
| (ii) | any change is made to the category of underlying assets held in respect of the policy or arrangement. |
| (d) | A fund must not invest or contractually commit to invest in an asset, including a hedge fund or private equity fund, where the fund may suffer a loss in excess of its investment or contractual commitment in the asset. This does not preclude a fund from investing in derivative instruments subject to subregulation (7). Hedge funds and private equity funds that may expose the fund to a liability must be held in a limited liability structure. |
(dA) Subject to paragraph (d), a fund may invest in a hedge fund, subject to conditions that may be prescribed.
[Regulation 28(3)(dA) inserted by section 3(a) of Notice No. 2230, GG46649, dated 1 July 2022: Effective 3 January 2023]
| (e) | Assets and categories of assets referred to in Table 1 must be calculated at fair value for reporting purposes. |
| (f) | The aggregate exposure to assets specified in the following items of Table 1 must not exceed 45 percent of the aggregate fair value of the total assets of a fund:— |
| (i) | item 2.1(e)(ii): Other debt instruments not listed on an exchange; |
| (ii) | item 3.1(b): Preference and ordinary shares in companies, excluding shares in property companies, not listed on an exchange; |
| (iii) | item 4.1(b): Immovable property, preference and ordinary shares in property companies, and linked units comprising shares linked to debentures in property companies, not listed on an exchange; |
| (v) | item 9: Private equity funds; and |
| (vi) | item 10: any other asset not referred to in this schedule. |
[Regulation 28(3)(f) substituted by section 3(b,c,d,e) of Notice No. 2230, GG46649, dated 1 July 2022: Effective 3 January 2023]
| (g) | The aggregate exposure to assets specified in the following items of Table 1 must not exceed 20 percent of the aggregate fair value of the total assets of a fund:— |
| (i) | item 3.1(b): Preference and ordinary shares in companies, excluding shares in property companies, not listed on an exchange; and |
| (ii) | item 9: Private equity funds. |
[Regulation 28(3)(g) substituted by section 3(f,g) of Notice No. 2230, GG46649, dated 1 July 2022: Effective 3 January 2023]
| (h) | The aggregate exposure by a fund per issuer or entity, in respect of all asset categories specified in Table 1, irrespective of the limits referred to in Column 1 of Table 1, must not exceed 25 per cent of the aggregate fair value of the total assets of the fund, excluding any debt instruments issued by, and loans to, the government of the Republic and any debt or loan guaranteed by the Republic . |
Regulation 28(3)(h) substituted by section 3(h) of Notice No. 2230, GG46649, dated 1 July 2022: Effective 3 January 2023]
| (i) | The aggregate exposure to foreign assets, referred to in Column 1 of Table 1 and expressed as a percentage, must not exceed the maximum allowable amount that a fund may invest in foreign assets as determined by the South African Reserve Bank, or such other amount as may be prescribed. |
| (iA) | The aggregate exposure by a fund to all issuers in respect of direct infrastructure, across all asset categories, excluding any debt instrument issued or guaranteed by the South African government, may not exceed 45% of the aggregate fair value of the total assets of the fund; |
Regulation 28(3)(iA) inserted by section 3(i) of Notice No. 2230, GG46649, dated 1 July 2022: Effective 3 January 2023]
| (iB) | The limit of 65 per cent in respect of housing loans granted to members in accordance with the provisions of section 19(5) of the Act referred to in item 7 of Table 1— |
| (i) | applies, with effect from 3 January 2023, in respect of loan guarantees entered into on or subsequent to that date; and |
| (ii) | does not apply in respect of loan guarantees that have been entered into prior to 3 January 2023. |
Regulation 28(3)(iB) inserted by section 3(i) of Notice No. 2230, GG46649, dated 1 July 2022: Effective 3 January 2023]
| (j) | Notwithstanding paragraphs (a)-(iB), the limits set out in this regulation may be exceeded where the excess is due to a change in the fair value or characteristic of an asset, and not as a result of discretionary transacting either by the fund or on the fund's behalf, provided that where a fund exceeds any limit:— |
Words preceding regulation 28(3)(j) substituted by section 3(j) of Notice No. 2230, GG46649, dated 1 July 2022: Effective 3 January 2023]
| (i) | such fund must inform the Registrar without delay of the limit being exceeded, including the reasons for such excess; |
| (ii) | such fund must not, for as long as the excess exists, make any further investments or contractual commitments to invest in those assets or categories of assets; and |
| (iii) | the board must ensure compliance with the relevant limits within 12 months from the date of the excess arising or such other period as determined by the Registrar. |
| (k) | A fund may not invest in crypto-assets, including in relation to Item 10 of Table 1. |
Regulation 28(3)(k) inserted by section 3(k) of Notice No. 2230, GG46649, dated 1 July 2022: Effective 3 January 2023]
