COVID-19: AMENDED REGULATIONS – ESSENTIAL SERVICES EXPANDED TO INCLUDE BROADER FINANCIAL SERVICES AND FINANCIAL MARKETS ACTIVITY, SOUTH AFRICA
A third amendment has been released to the Regulations to the Disaster Management Act 2002, published by Government Notice No 318 of 18 March 2020, as amended by Government Notice No 398 of 25 March 2020 and Government Gazette Notice No 419 of 26 March 2020 (Regulations).
Prior to the latest amendment of the Regulations, the definition of essential services, in relation to the financial sector, was limited to ‘financial services necessary to maintain the functioning of the banking and payment environment, including the JSE and similar exchanges, as well as Insurance services’.
The amendment of Paragraph 3 of Part B, Annexure B of the Regulations brings greater clarity to the financial sector. Essential services has been amended to now include ‘the following services necessary to maintain the functioning of a financial system as defined in section 1(1) of the Financial Sector Regulation Act, only when the operation of a place of business or entity is necessary to continue to perform those services:
i. the banking environment (including the operations of mutual banks, cooperative banks, co-operative financial institutions and the Postbank);
ii. the payments environment;
iii. the financial markets (including market infrastructures licensed under the Financial Markets Act, 2012 (Act No. 19 of 2012);
iv. the insurance environment;
v. the savings and investment environment;
vi. pension fund administration;
vii. outsourced administration;
viii. medical schemes administration; and
ix. additional services designated in terms of regulation 11B(4A)(c)(i)'.
While the amendment of the Regulations incorporates multiple areas of the financial sector under the ambit of essential services, the abovementioned services may not be construed to include debt collection services.
Please ensure that you also consider any notices issued by the relevant regulator that may provide clarity in regard to what is considered as essential services.