Draft Regulations that propose to designate the “provision of a benchmark” as a financial service in accordance with section 3(3) of the Financial Sector Regulation Act (FSRA) have been drawn up.
National treasury published the draft Regulations in Government Gazette 45071 for comment.
In a statement, treasury indicates that the draft Regulations specify that the Financial Sector Conduct Authority (FSCA) is the responsible authority for the regulation, supervision and oversight of the financial service of the “provision of a benchmark” in accordance with section 3(5) of the FSRA.
According to treasury, benchmarks “play a key role in the financial system’s core functions of pricing and allocating capital and risk”.
“Doubts regarding the accuracy and integrity of benchmarks may undermine financial confidence, cause significant losses to financial customers, and distort the economy.”
Treasury points out that it is, therefore, essential to ensure the integrity of benchmarks and the benchmark setting process.
The draft Regulations will enable the FSCA to “appropriately supervise and regulate the provision of benchmarks, in terms of a regulatory framework that is aligned with international standards”.
Comment is invited until 13 October 2021.
Meanwhile, during an address at the launch of the report on the economic empowerment of women in the green industry, treasury’s director-general, Dondo Mogajane, highlighted the key policy levers in place to support the systemic change needed to transition to a low carbon and climate resilient economy.
Policy levers include carbon pricing; green taxonomy and risk disclosures; financial incentives; reorienting public spending; tracking the flows of climate finance; accessing climate finance and energy sector economic reforms and Just transition and Operation Vulindlela.