| (1) |
In this Act "financial product" means— |
| (b) |
a long-term policy as defined in section 1(1) of the Long-term Insurance Act or a life insurance policy as defined in section 1 of the Insurance Act; |
[Section 2(1)(b) substituted by item 1(2)(a) of schedule 1 of Act No. 18 of 2017]
| (c) |
a short-term policy as defined in section 1(1) of the Short-term Insurance Act or a non-life insurance policy as defined in section 1 of the Insurance Act; |
[Section 2(1)(c) substituted by item 1(2)(b) of schedule 1 of Act No. 18 of 2017]
| (d) |
a benefit provided by— |
| (i) |
a pension fund organisation, as defined in section 1(1) of the Pension Funds Act, to a member of the organisation by virtue of membership; or |
| (ii) |
a friendly society, as defined in section 1(1) of the Friendly Societies Act, to a member of the society by virtue of membership; |
| (f) |
a health service benefit provided by a medical scheme as defined in section 1(1) of the Medical Schemes Act; |
| (h) |
a warranty, guarantee or other credit support arrangement as provided for in a financial sector law; |
| (i) |
a facility or arrangement designated by Regulations for this section as a financial product; and |
| (j) |
a facility or arrangement that includes one or more of the financial products referred to in paragraphs (a) to (i). |
| (a) |
doing so will further the object of this Act set out in section 7; and |
| (b) |
the facility or arrangement is one through which, or through the acquisition of which, a person conducts one or more of the following activities: |
| (ii) |
making a financial investment; and |
| (iii) |
managing financial risk. |
| (3) |
For the purposes of subsection (2)(b)(ii), a person makes a financial investment when the person (the "investor")— |
| (a) |
gives a contribution, in money or money’s worth, to another person and any of the following apply: |
| (i) |
The other person uses the contribution to generate a financial return for the investor; |
| (ii) |
the investor intends that the other person will use the contribution to generate a financial return for the investor, even if no return, or a loss, is in fact generated; |
| (iii) |
the other person intends that the contribution be used to generate a financial return for the investor, even if no return, or a loss, is in fact generated; and |
| (b) |
has no day-to-day control over the use of the contribution. |
| (4) |
For the purposes of subsection (2)(b)(iii), a person manages financial risk when the person— |
| (a) |
manages the financial consequences to the person of particular events or circumstances occurring or not occurring; or |
| (b) |
avoids or limits the financial consequences of fluctuations in, or in the value of, receipts or costs, including prices and interest rates. |
Contingency Fees Act, 1997
