Reference no: EM133267374

Summarize information below:

Legal and Regulatory Considerations 

South Africa is subject to exchange control regulations that imply that foreign investments and the repatriation of funds are regulated and require the approval of the South African Reserve Bank (SARB). The regime is set out in, and regulated in terms of, the Currency and Exchanges Act 1933 and the Exchange Control Regulations promulgated under this. There is also a non-binding Exchange Control Manual that deals with practices and guidelines in applying or implementing the Regulations. SARB has delegated much of its power and authority to "authorized dealers" (essentially banks and other institutions licensed to undertake exchange control functions and grant approvals under exchange control). The exchange control authorities have a wide discretion that is exercised in accordance with the Exchange Control Regulations (including the various orders and rules issued under these Regulations) and the Exchange Control Rulings in line with the policy guidelines laid down by the Minister of Finance. All applications for exchange control approval must be made through an authorized dealer. The exchange control system has been gradually liberalized over the past few years in South Africa and it is the stated intention of the National Treasury that the gradual liberalization and deregulation of exchange control will continue. Most (but not all) of the exchange control policies and regulations are focused on the exchange control transactions of South African residents (that is, outward transactions). The interpretation of the Exchange Control Regulations and rulings, on which the exchange control system is based, is largely subject to the policies of the SARB and the National Treasury.