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Financial Advisory and Intermediary Services Act, 2002 (Act No. 37 of 2002)

Chapter II : Authorisation of Financial Services Providers

9. Suspension and withdrawal of authorisation

 

 

1) The registrar may, subject to subsection (2) and irrespective of whether the registrar has taken or followed, or is taking or following, any step or procedure referred to in section 4, at any time suspend or withdraw any licence (including the licence of a licensee under provisional or final suspension) if satisfied, on the basis of available facts and information, that the licensee—
a) does not meet or no longer meets the fit and proper requirements applicable to the licensee, or if the licensee is a partnership, trust or corporate or unincorporated body, that the licensee or any key individual of the licensee does not meet or no longer meets the fit and proper requirements applicable to the licensee or the key individual;

[Paragraph (a) amended by section 184(a) of Act No. 45 of 2013]

b) did not, when applying for the licence, make a full disclosure of all relevant information to the registrar, or furnished false or misleading information;
c) has failed to comply with any other provision of this Act;

[Paragraph (c) amended by section 184(b) of Act No. 45 of 2013]

d) is liable for payment of a levy under section 15A of the Financial Services Board Act, 1990 (Act No. 91 of 1990), a penalty under section 41(2) and (3) or an administrative sanction under section 6D(2) of the Financial Institutions (Protection of Funds) Act, 2001 (Act No. 28 of 2001), and has failed to pay the said levy, penalty or administrative sanction and any interest in respect thereof;

[Paragraph (d) amended by section 184(b) of Act No. 45 of 2013]

e) does not have an approved key individual;

[Paragraph (e) inserted by section 184(c) of Act No. 45 of 2013]

f) has failed to comply with any directive issued under this Act; or

[Paragraph (f) inserted by section 184(c) of Act No. 45 of 2013]

g) has failed to comply with any condition or restriction imposed under this Act.

[Paragraph (g) inserted by section 184(c) of Act No. 45 of 2013]

 

2)
a) Before suspending or withdrawing any licence, the registrar—
i) may consult any regulatory authority; and
ii) must inform the licensee of the intention to suspend or withdraw and the grounds therefore and must give the licensee a reasonable opportunity to make a submission in response thereto.
b) Where the registrar contemplates the suspension or withdrawal of any licence, the registrar must also inform the licensee of-
i) The intended period of the suspension; and
ii) Any terms to be attached to the suspension or withdrawal, including-
aa) a prohibition on concluding any new business by the licensee as from the effective date of the suspension or withdrawal and, in relation to unconcluded business, such measures as the registrar may determine for the protection of the interests of clients of the licensee; and
bb) terms designed to facilitate the lifting of the suspension.

[Subparagraph (ii) amended by section 184(e) of Act No. 45 of 2013]

[Paragraph (b) amended by section 184(d) of Act No. 45 of 2013]

c) The registrar must consider any response received, and may thereafter decide to suspend or withdraw, or not to suspend or withdraw, the licence, and must notify the licensee of the decision.
d) Where the licence is suspended or withdrawn, the registrar must make known the reasons for the suspension or withdrawal and any terms attached thereto by notice on the official web site and may make known such information by means of any other appropriate public media.

[Paragraph (d) amended by section 184(f) of Act No. 45 of 2013]

 

3) Notwithstanding the provisions of subsection (2), the registrar may under urgent circumstances, where the registrar is satisfied on reasonable grounds that substantial prejudice to clients or the general public may occur-
a) Provisionally suspend or withdraw a licence, and inform the licensee of the-
i) grounds therefor; and
ii) period and terms of suspension as referred to in subsection (2)(b),

and give the licensee a reasonable opportunity to respond thereto and to provide reasons why the provisional suspension or withdrawal should be lifted or why the period and terms should be changed; and

b) Make known such provisional suspension or withdrawal by notice on the official web site and, if necessary, by means of any other appropriate public media.

[Paragraph (b) amended by section 184(g) of Act No. 45 of 2013]

 

4)
a) The registrar must, within a reasonable time after receipt of any response contemplated in subsection (3)(a) consider the response, and may thereafter decide to-
i) lift the provisional suspension or withdrawal; or
ii) render the provisional suspension or withdrawal final,

and must inform the licensee accordingly.

b) The registrar must make known the terms of and reasons for such final suspension or withdrawal, or the lifting thereof, by notice on the official web site and, if necessary, in any other appropriate public media.

[Subsection 4 amended by section 184(h) and (i) of Act No. 45 of 2013]

 

5) During any period of suspension, whether provisional or final, the license concerned is for the purposes of this Act regarded as a person who is not authorised to act as a financial services provider.

 

6)
a) A person whose licence has been withdrawn under this section is debarred for a period specified by the registrar from applying for a new licence.
b) The registrar may, on good cause shown, vary any such period.