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Comment Period on Competitive Financial Markets Paper Extended

March 23, 2020

National Treasury

The deadline for comment on the “Building Competitive Financial Markets for Innovation and Growth – A Work Programme for Structural Reforms to South Africa’s Financial Markets” discussion paper has been extended.

National treasury released the paper for comment at the beginning of March 2020.

It contains a number of proposals to reform the regulatory and legislative framework for the domestic financial markets and to create an enabling framework supportive of competitive financial markets and responsive to developments in those markets.

Comment was originally sought until 30 March 2020.

According to an earlier treasury statement, the discussion paper focuses on the “gaps in the current Financial Markets Act (19 of 2012) (FMA), and considers the developments in the domestic and international financial markets regulatory framework and the alignment of the domestic regulatory framework to international best practices, given the cross-border nature of financial market activities”.

The paper also focuses on the interplay between the FMA and the “Twin Peaks” framework and how best to align them.

Treasury pointed out that the paper contains input from the Financial Sector Conduct Authority, the Prudential Authority and the South African Reserve Bank as well as various market participants.

According to treasury, the aim of the paper is to “solicit views from market participants on the proposals that will inform the contents of the new draft of the financial markets legislation”.

Broad themes contained in the discussion paper include broadening the scope of legislation, balancing the self-regulatory framework of certain financial markets infrastructures and empowering the regulatory authorities, extending the licensing and authorisation framework, the alignment of provisions with internationally agreed principles and best practices, extending the scope of the market abuse framework and recommendations to address market fragmentation and creating level playing fields within financial markets.

Comment is now invited until 20 April 2020.

Meanwhile, treasury has issued an Instruction Note 8 of 2019/20 applicable to Public Finance Management Act institutions and a Municipal Finance Management Act (MFMA) Circular 100 for municipalities and municipal entities, designed to speed up the procurement of goods/commodities required to reduce and control the spread of COVID-19.

In a statement, treasury points out that the “Instruction Note and MFMA Circular aim to augment and enhance uniformity across organs of state, decisions by Accounting Officers and Accounting Authorities in their emergency procurement, in support of effective and efficient service delivery and curb the possible abuse of Supply Chain Management (SCM) systems during the period of managing this national disaster”.

Treasury added that the recent declaration of a state of disaster following the rapid spread of the coronavirus called for the increased procurement of health-related gear and collateral.