Trustees must submit Beneficial Ownership Information by 15 November 2024

Trustees must submit Beneficial Ownership Information by 15 November 2024

• 24 October 2024
• Regulatory Compliance and Legislation
• South African Accounting Academy

Summary:

The Department of Justice and Constitutional Development (DoJ&CD) has issued a media statement confirming that the deadline for the filing of the beneficial ownership register with the Master of the High Court is the 15 November 2024.

Article:

The trustees who are found guilty of not complying with the provisions of the amended Trust Property Act 1988 will face harsher punishment. The implementation of the amendments to the Trust Property Control Act, 1988 came into effect on 01 April 2023.

Any trustee who does not comply with the Amendment Act will face harsher punishment if they are found guilty in a court of law. According to the Amendment Act, a trustee commits an offence if they fail to disclose to an accountable institution that they engage with in the capacity of a trustee, that the relevant transaction or business relationship relates to trust property.

The trustee also commits an offence if:

• they fail to record the details of accountable institution prescribed in regulation 3B;
• they fail to establish and record the beneficial ownership information of a trust prescribed in regulation 3C and
• when they fail to keep an up to date record of the beneficial ownership information prescribed in regulation 3C or
• fails to lodge a register of the beneficial ownership information prescribed in regulation 3C with the Master of the High Court.

A trustee who is convicted of any of the offences referred to above will be liable to a fine of up to R10 million or imprisonment for a period of up to five years or to both fine and imprisonment.

It has been noted that there is a low level of compliance with these provisions by trustees, in particular the lodging of the beneficial ownership information with the Master of the High Court. This low level of compliance will have a significant impact on SA exiting the grey-list by the January 2025 deadline.

As such, the deadline for the filing of the beneficial ownership register with the Master of the High Court is the 15 November 2024. All trustees are nonetheless reminded that the law is already in operation and remains applicable together with the penalties for non-compliance.

Read more on submitting beneficial ownership information for trusts in the Chief Master’s Directive 8 at https://www.justice.gov.za/master/m_docs/2023-08_CHM-directive.pdf

Click here to access the Media Statement:

https://www.justice.gov.za/m_statements/2024/20240917-Trustees.html

Relevance to Auditors, Independent Reviewers & Accountants:

• The BO Register is required in terms of Trust Property Control Act 57 of 1988, and General Laws (Anti-Money Laundering and Combating Terrorism Financing) Amendment Bill.
• The above acts are yet more pieces of legislation that your clients must comply with, and which you must assess compliance with.  If they don’t comply with the relevant laws and regulations, you have certain reporting obligations in terms of NOCLAR (NOn-Compliance with Laws And Regulations) – this could include reporting to management, qualifying your audit opinion, reporting a Reportable Irregularity, etc.
• As an auditor, independent reviewer and accountant who has trusts as clients, you need to consider whether trustees are keeping the BO Register, as required.
• If you are advising your trust clients and trustees, you need to be aware of the latest information, tools, templates and directives that have been issued by the Master’s Office.

Relevance to Your Clients:

• All Masters have a duty to keep an electronic Beneficial Ownership Register (BOR) for Trust matters.
• Trustees have certain obligations that must be fulfilled, including the submission of Beneficial Ownership information, as required.
• Your clients need to be aware of the latest information and directives that have been issued by the Master’s Office.

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