Joint Notice 1 of 2026: What the FSCA and PA's Draft Beneficial Ownership Standard means
South Africa's regulatory focus on Ultimate Beneficial Ownership (UBO) is sharpening further. The Financial Sector Conduct Authority (FSCA) and the Prudential Authority (PA) have recently jointly published Joint Notice 1 of 2026, opening public consultation on a draft Joint Standard that will set out standardised, FSCA/PA-supervised requirements for how financial institutions identify, verify and report on the natural persons who ultimately own or control them.
If your business is an accountable institution (AI) under Schedule 1 of the Financial Intelligence Centre Act (FIC Act) and a financial institution regulated by the FSCA or PA, this draft Standard deserves your close attention now, while it is still open for comment.
What has been published?
The Authorities have released four documents on their respective websites:
Joint Notice 1 of 2026 – the notice inviting comment;
The draft Joint Standard – Requirements Pertaining to Beneficial Owners;
A Statement of Need and Impact supporting the draft; and
A Comments Template for structured submissions.
All are accessible on the FSCA's website under Home > Supervisory Information > Documents for Consultation > General FSCA Legislation > Joint Notice 1 of 2026 - Invitation to comment - Proposed Requirements for Beneficial Owners.
Why this matters
The rationale behind the draft Standard is straightforward: beneficial ownership structures can be misused to obscure who ultimately controls a financial institution. Shell companies, trusts, and layered corporate chains are classic tools used to hide illicit funds, evade sanctions screening, or conceal the involvement of politically exposed persons. Because the FSCA and PA license financial institutions, they sit at a critical gatekeeping point.
While general FIC Act customer due diligence duties already require AI’s to identify the beneficial owners of their clients, this draft Standard is different: it creates FSCA/PA-supervised rules about the beneficial owners of the institution itself, a further, more prescriptive layer on top of your existing FIC Act obligations.
Who is actually in scope?
This Standard only applies to you if you're both a "financial institution" (regulated under the Financial Sector Regulation Act) and an "accountable institution" (listed under Schedule 1 of the FIC Act), you need to meet both conditions, not just one. Co-operative financial institutions are automatically included either way. To make it easy to check, the regulators set out the exact list of qualifying business types in the Statement of Need and Impact document (Section 2.3.2), also listed below:
Item 4 - Authorised user of an exchange (Financial Markets Act)
Item 5 - CIS manager (Collective Investment Schemes Control Act), excluding Part VI–only managers
Item 6 - Person carrying on the "business of a bank" (Banks Act)
Item 7 - Mutual bank (Mutual Banks Act)
Item 7A - Co-operative bank (Co-operative Banks Act)
Item 8 - Life insurance business (Insurance Act), excluding reinsurance
Item 12 - FSP authorised to advise/intermediate on investment products (FAIS Act), excluding non-life insurance, reinsurance and medical schemes
Item 19 - Money or value transfer provider
Item 23 - Clearing system participant (National Payment System Act) facilitating/enabling EFT origination or receipt
Outside the scope of this specific Standard (though still bound by general FIC Act beneficial-ownership duties toward their own clients): legal practitioners (Item 1), trust and company service providers (Item 2), estate agents (Item 3), casinos (Item 9), dealers in foreign exchange (Item 10), credit providers (Item 11), high-value goods dealers (Item 20), the South African Mint Company (Item 21), and crypto asset service providers (Item 22). These are Schedule 1 AI’s, but they are not FSCA/PA-supervised “financial institutions” under the FSR Act, so this Standard does not currently apply to them.
Key proposed requirements
While the draft is still open for comment and details may change, the current text sets out several core obligations for affected AI’s:
1. Honesty and integrity of beneficial owners
Beneficial owners of Financial Accountable Institutions must be honest and have integrity. The draft lists an extensive set of factors that create prima facie evidence to the contrary, including relevant criminal convictions, civil liability for fraud or money laundering, breaches of fiduciary duty, adverse regulatory action, or involvement in businesses placed under curatorship or resolution. A natural person who wishes to rebut such a finding must submit a declaration to the Authorities explaining why they should nonetheless be considered fit and proper.
2. Governance and due diligence
AI’s must establish governance policies and procedures to identify, obtain information on, and verify their beneficial owners, and must take reasonable steps to confirm ongoing compliance with the honesty and integrity requirement, including periodic re-screening at least every two years.
3. A beneficial ownership repository
AI’s must maintain an accurate, up-to-date repository of beneficial owner details and submit this register to the relevant Authority annually.
4. Licensing and notification duties
Beneficial owner details must be disclosed upfront when applying for a licence or authorisation. Once licensed, institutions must notify the Authorities within 30 calendar days of identifying a new or potential beneficial owner, or of a beneficial owner ceasing to hold that status.
5. Defined ownership and control thresholds
The draft sets clear, quantifiable tests:
Direct ultimate ownership: holding 5% or more of a financial institution.
Direct effective control: the ability to exercise or control 15% of voting rights, appoint or remove 15% of governing body members, or otherwise materially influence management, key decisions, or the institution's capital and assets.
Indirect effective control: materially influencing another person who themselves meets the ownership or control thresholds above.
6. Limited exclusions
Certain categories of natural persons are excluded from the definition of “beneficial owner”, for example, those who acquired an ownership interest solely through listed securities, as members of a pension fund, as investors in a collective investment scheme, or through an employee share scheme.
Once finalised, the Joint Standard is proposed to take effect six months after the date of publication, giving institutions a defined runway to align internal processes.
How to have your say
Submissions must be made in writing, using the prescribed Comments Template, by 25 September 2026.
Submissions and enquiries should be sent to both:
The FSCA at FSCA.RFDStandards@fsca.co.za, and
The Prudential Authority at PA-Standards@resbank.co.za.
The full suite of documents is available on the FSCA's website under Home > Supervisory Information > Documents for Consultation > General FSCA Legislation > Joint Notice 1 of 2026 - Invitation to comment - Proposed Requirements for Beneficial Owners, or directly via the FSCA's Documents for Consultation page.
Our recommendation
Given the operational implications, we encourage all AI’s to review the draft Joint Standard closely, confirm whether they fall within scope and consider whether the proposed thresholds and processes are workable in practice. This is a valuable opportunity to shape a Standard that will directly affect your governance and compliance obligations once it comes into force.
