The General Laws (Anti-Money Laundering and Combating Terrorism Financing) Amendment Act, 2022 (Amendment Act), published in the Government Gazette on 29 December 2022, makes key amendments to the Trust Property Control Act, 1988.

  1. A list of grounds for the disqualification of trustees aligns to some extent with the grounds for the disqualification of directors set out in the Companies Act, 2008 . A person is disqualified from being authorised as a trustee if, for example, they have been disqualified by a court from acting as a director of a company in terms of the Companies Act, or are sanctioned by the United Nations.
  2. It clarifies that trustees appointed outside of South Africa can only administer or dispose of trust property in South Africa once authorised in writing by the Master of the High Court.
  3. The requirement is added that a trustee must disclose their position as trustee, and that they are dealing with trust property, to any accountable institution that they engage with in their capacity as trustee. For purposes of this amendment, an accountable institution refers to those entities set out in Schedule 1 of FICA and includes, for example, attorneys and estate agents.
  4. Trustees must record prescribed details (which are still to be prescribed) relating to accountable institutions which are appointed as agents or service providers to the trust to perform any of the trustee’s functions relating to the trust property.
  5. creating requirements relating to the disclosure of beneficial ownership. “Beneficial owners” is not a reference to any beneficiaries of the trust.  For purposes of the Amendment Act, “beneficial owners” only contemplates beneficiaries that are named in the trust deed.
  6. Trustees who fail to comply with the disclosure requirements introduced by the Amendment Act will commit a criminal offence punishable by up to five years’ imprisonment or a R10 million fine.
  7. The Master is given additional powers to remove trustees from office.

Most of these amendments will take effect on 1 April 2023. It is important for trustees to familiarise themselves with the Amendment Act, particularly the new disclosure obligations.

The Amendment Act is designed to combat money laundering, terrorist financing and other financial crime by amending key pieces of legislation, including the Trust Property Control Act, and the Companies Act. It forms part of the country’s effort to avoid grey-listing by the Financial Action Task Force (FATF). The FATF is set to make its decision on grey-listing in late February 2023.