Delay in RDR implementation
The Financial Services Board (FSB) has announced a delay in the RDR Phase I timelines originally communicated in November 2015. At that time, the FSB planned for the drafts that would give effect to most of the RDR Phase I proposals be published for comment in April 2016, with effective dates staggered between July and November.
The timing of implementation has now been delayed, due to National Treasury asking that the consultation on insurance-related legislation be held back until after Parliament has been briefed on the new Insurance Bill, 2016.
Because the same regulatory instruments will be used to align the new Insurance Bill requirements with the updated market conduct requirements under the Long-term and Short-term Insurance Acts, draft amendments to Regulations and Policyholder Protection Rules under the Long-term and Short-term Insurance Acts will be published for comment later than planned. The date of promulgation of the relevant regulatory instruments also needs to be aligned with the proposed effective date of the Insurance Bill, namely 1 January 2017 (dependent on the meeting schedule of Parliament’s Standing Committee on Finance).
At the same time, the latest draft of the Financial Sector Regulation (FSR) Bill, published in October 2015, is still awaiting parliamentary approval. Once the FSR comes into force, the regulator will restructure itself as the Financial Sector Conduct Authority (FSCA).
RDR Phase I will therefore be postponed until 2017, and we’ll be keeping you up to date as the new timelines unfold.