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Unit Standard No.12164Page 87

THE AUTHORISATION PROCESS

The whole authorisation process is based on the application by the FSP to be licenced as an authorised FSP.  There are many people involved in this process, as can be seen below.  The FSP persona within FAIS can be one of three categories as was seen in Module 3 – either an FSP I, FSP II or an FSP III.  Each of these FSP’s operate in a different sub sector of the Financial Services Industry and therefore have different pieces of legislation which apply to them.  As mentioned in Module 1, some of this applicable legislation would be generic (such as FAIS!) whilst the others would be specific (Long Term Insurance Act, Short Term Insurance Act, and Collective Investment Schemes Act.)  It is important to see FAIS in this way – that it performs the extremely difficult task of regulating a number of very different sub sectors.  

More importantly, since FAIS is functional and not institutional in its applicability (it applies to an organisation that is either in the business of rendering an intermediary service or giving of advice, or both), the impact which it has on each of the sub sectors is slightly different, purely by virtue of the fact that the actual sub sectors are different.

What follows, is a table depicting the different COMPETENCY REQUIREMENTS in the DETERMINATION OF FIT AND PROPER for the different categories of FSP’s which FAIS refers to, and the different competency licencing requirements for each of them.  Should you require more detail than this, then refer to subordinate legislation, Determination of Fit and Proper requirements.

FSP CATEGORY

FSP CATEGORY I

FSP CATEGORY II

(Discretionary FSP’s or Investment Managers)

FSP CATEGORY III

(Administrative FSP’s or LISP’s)

COMPETENCY REQUIREMENTS

Depends on  category of   product  -different for each product category

Depends on sub category – goes from sub category (1) to sub category (5)

Differs according to years of experience and qualifications.

INSMAT final materials31/10/03

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