Acts Online
GT Shield

Medical Schemes Act, 1998 (Act No. 131 of 1998)

Chapter 4 : Medical Schemes

26. Effect of registration


(1) Any medical scheme registered under this Act shall—
(a) become a body corporate capable of suing and being sued and of doing or causing to be done all such things as may be necessary for or incidental to the exercise of its powers or the performance of its functions in terms of its rules;
(b) assume liability for and guarantee the benefits offered to its members and their dependants in terms of its rules; and
(c) establish a bank account under its direct control into which shall be paid every amount—
(i) received as subscription or contribution paid by or in respect of a member; and
(ii) received as income, discount, interest, accrual or payment of whatsoever kind.


(2) No person shall have any claim on the assets or rights or be responsible for any liabilities or obligations of a medical scheme, except in so far as the claim has arisen or the responsibility has been incurred in connection with transactions relating to the business of the medical scheme.


(3) The assets, rights, liabilities and obligations of a medical scheme, including any assets held in trust for the medical scheme by any person, as existing immediately prior to its registration, shall vest in and devolve upon the medical scheme without any formal transfer or cession.


(4) No amount shall be debited to the account contemplated in subsection 1(c) other than—
(a) payments by a medical scheme of any benefit, payable under the rules of a medical scheme;
(b) costs incurred by the medical scheme in the carrying on of the business as a medical scheme; or
(c) amounts invested by the board of trustees in accordance with section 35(7).


(5) No payment in whatever form shall be made by a medical scheme directly or indirectly to any person as a dividend, rebate or bonus of any kind whatsoever.


(6) No person other than an employer shall receive, hold or in any manner deal with the subscription or contribution which is payable to a medical scheme by or on behalf of a member of such medical scheme.


(7) All subscriptions or contributions shall be paid directly to a medical scheme not later than three days after payment thereof becoming due.


(8) The officer in charge of a deeds registry in which is registered any deed or other document relating to any asset or right which in terms of subsection (3) vests in or devolves upon a medical scheme, shall, upon production to him or her by the medical scheme of its certificate of registration and of the deed or other document aforesaid, without payment of transfer duty, stamp duty, registration fees or charges, make the endorsements upon such deed or document and the alterations in his or her registers that are necessary by reason of such vesting or devolution.


(9) All moneys and assets belonging to a medical scheme shall be kept by that medical scheme and every medical scheme or the administrator, as the case may be, shall maintain such books of accounts and other records as may be necessary for the purposes of such medical scheme.


(10) Every medical scheme shall have a registered office in the Republic.


(11) No medical scheme shall carry on any business other than the business of a medical scheme and no medical scheme shall enrol or admit any person as a member in respect of any business other than the business of a medical scheme.