The Financial Intelligence Centre (FIC) has invited a second round of comment on its draft public compliance communication (PCC) on the definition of beneficial ownership and the application of section 21B of the Financial Intelligence Centre Act (FICA).
In addition, Draft PCC 121 highlighted the money laundering, terrorist financing, and proliferation financing risks related to beneficial owners.
Draft PCC 121 was made available for a first round of consultation from 8 December 2023 to 16 February 2024.
Read: FIC publishes draft guidance on how accountable institutions can identify beneficial ownership
All the comments received have been considered and incorporated in the updated draft PCC 121A where appropriate, the FIC said in a statement on 14 June.
Click here to download the FIC’s responses to the comments it received.
Draft PCC 121A is available for consultation, and comments are invited by accountable institutions, supervisory bodies, and other interested persons from Friday, 14 June to the close of business on Friday, 5 July 2024.
Comments on Draft PCC 121A must be submitted via the online link.
Section 21B(1) of FICA requires an accountable institution to establish the nature of a client’s business and the ownership and control structure of the client.
The draft PCC has sections that provide guidance on how to establish the beneficial owners of legal persons, trusts, partnerships, and non-governmental organisations.
The General Laws (Anti-Money Laundering and Combating Terrorist Financing) Amendment Act amended the definition of beneficial ownership in FICA and section 21B of the Act, which widened the application of the section.
In a consultation note published on 15 November, the FIC said Draft PCC 121 aimed to address concerns highlighted in the Financial Action Task Force’s 2019 Mutual Evaluation final report and the FATF’s “action items” that followed South Africa’s grey-listing in February this year. The shortcomings identified include that supervisory bodies have not provided enough guidance on beneficial ownership.
Draft PCC 121 was also a response to numerous requests from supervisory bodies and accountable institutions for further guidance on the application of section 21B of FICA, the FIC said.
