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Contributed by Carmen Diehl, C.A.(Namibia), Senior Manager: Risk Management and Compliance

The FIMA (Act 2 of 2021) was promulgated in Government Gazette no. 7645 on 1 October 2021. The Minister of Finance has not yet set a date for it to become effective. It hibernated ever since, but following last year’s elections, we will see action on it again in 2025, once the new Minister of Finance has been appointed and found his feet. NAMFISA, however, has not been idle, spending a lot of time revising and issuing FIMA standards and regulations. In the next few issues of this newsletter, we will present the latest status on the standards and regulations and provide a brief overview.

Introduction

Since 2015, NAMFISA has issued draft standards and regulations under the FIM Bill and the FIM Act to the Industry for comment. Because of industry comments or other developments, various standards and regulations have been updated, reissued, withdrawn, or included in other standards or regulations.

Below is a list of all draft standards and regulations under the FIM Act that apply to retirement funds. A summary of their main provisions will be presented over the next few newsletter issues.

The FIM Act includes retirement funds in the definition of ‘financial institutions’, so all standards and regulations applicable to financial institutions also apply to retirement funds (unless they are explicitly excluded).

NAMFISA issues standards, while the Minister of Finance issues regulations.

List of draft standards and regulations under the FIM Act

The draft standards and regulations under the FIM Act applicable to retirement funds and approved by the NAMFISA Board by the end of 2022 are as follows:

Standards Chapter 5: Retirement Funds

  • RF.S.5.1 Definition of ‘actuarial surplus’
  • RF.S.5.2 Requirements for an investigation by and the report of a valuator
  • RF.S.5.3 Minimum information that must be furnished to a fund by an employer with respect to the payment of contributions
  • RF.S.5.4 Requirements for rules of a fund and any amendment of such rules
  • RF.S.5.5 The determination of the soundness of the financial position of a fund
  • RF.S.5.6 Requirements for the voluntary termination or dissolution of a fund
  • RF.S.5.7 Minimum benefits that a fund must provide to its members
  • RF.S.5.9 Compulsory beneficiary nomination forms
  • RF.S.5.10 The conditions on which a defined contribution fund may be exempted from the requirement of regular investigations by a valuator
  • RF.S.5.13 Requirements of a communications strategy
  • RF.S.5.15 Requirements for the annual report of a fund
  • RF.S.5.17 Categories of persons having an interest in the compliance of a fund with payment of contributions and the reports that must be submitted to such persons
  • RF.S.5.18 Matters to be included in an investment policy statement
  • RF.S.5.19 Matters to be communicated to members and contributing employers and minimum standards for such communication
  • RF.S.5.20 Matters to be included in a code of conduct
  • RF.S.5.22 The transfer of any business from a fund to another fund or the transfer of any business from any other person to a fund
  • RF.S.5.23 The fee that may be charged to members for copies of certain documents, and the reports and other information that must be provided by the board of a fund to its members free of charge
  • RF.S.5.24 Manner and form of application for registration of a fund
  • RF.S.5.25 Form of certificate of registration for a fund
  • RF.S.5.26 Governance of retirement funds
  • RF.S.5.27 Manner and form of application, by a registered fund, for cancellation of registration, or variation of the conditions subject to which registration was granted

Regulations Chapter 5: Retirement funds

  • RF.R.5.1 Funds and classes of funds for inclusion in the definition of “fund”
  • RF.R.5.3 The terms and conditions on which the board of a fund may distribute some or all of an actuarial surplus
  • RF.R.5.5 Loans which may be granted to a member and guarantees which may be furnished to a person in respect of a loan granted or to be granted by such person to a member
  • RF.R.5.7 The rate of interest payable on contributions not transmitted or received, and on the value of a benefit or right to a benefit not transferred, before the expiration of the applicable period
  • RF.R.5.8 The protection of unpaid contributions of an employer
  • RF.R.5.11 Exemption from prohibited investments

Standards Chapter 10: General

  • GEN.S.10.8 Independence
  • GEN.S.10.9 Code of conduct
  • GEN.S.10.11 Institutional investment
  • GEN.S.10.12 Content of the investment mandate
  • GEN.S.10.13 Payment of contributions
  • GEN.S.10.17 Description of plain language
  • GEN.S.10.18 Fiduciary responsibilities of financial institutions and intermediaries and functionaries
  • GEN.S.10.19 The form and content of any application for approval of a change of name, use of another name or use of a shortened form or derivative form of a name
  • GEN.S.10.20 Definition of related party transactions and identifying those that are prohibited
  • GEN.S.10.23 Fees and charges

The missing numbers in the sequences above indicate that NAMFISA must still issue a standard.

The following draft standards under the FIM Act applicable to retirement funds were issued by NAMFISA to the Industry for comment (it is not certain whether the NAMFISA Board has approved these standards in the meantime):

Standards Chapter 10: General

  • GEN.S.10.2 Fit and proper requirements
  • GEN.S.10.10 Outsourcing

GEN.S.10.21 Treating customers fairly.

Important notice and disclaimer
This article summarises the understanding, observation and notes of the author and lays no claim on accuracy, correctness or completeness. RFS (Pty) Ltd does not accept any liability for the content of this contribution and no decision should be taken on the basis of the information contained herein before having confirmed the detail with the relevant party. Any views expressed herein are those of the author and not necessarily those of RFS.

 

 

 

 

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