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TRADE AND INVESTMENT OPPORTUNITIES IN SOUTH AFRICA

Specialised Licenses

Cellular Licenses

The Independent Communications Authority of South Africa (ICASA) regulates all wireless transmissions and issues licenses to providers of telecommunication services and broadcasters.

The Telecommunications Act, No. 103 of 1996 determines the procedures for applications for specialised licenses, such as cellular licenses, but application for these types of licenses can only be made on invitation by the Minister for Communications. The procedures for licensing private automatic branch exchange (PABX) systems and very-high-frequency (VHF) radios remain the same as in the past. In almost all cases, the equipment supplier handles licences for small-scale communications tools.

For more information, please contact:

Independent Communications Authority of South Africa (ICASA)
Tel.: +27 (11) 321 8200 • Fax: +27 (11) 321 8551
E-mail: info@icasa.org.za • Website: www.icasa.org.za

Banking Licences

A company may conduct banking operations in South Africa through one of three mediums. All of these require the approval of the Registrar of Banks, who heads up the Banking Supervision Department of the Reserve Bank. The three mediums are:
• A separate banking company;
• A branch of an international bank or banking group; and
• A representative office of an international bank.

A Separate Banking Company

To establish a separate banking company, the investor must begin by incorporating a public company with the Registrar of Companies. The greater of R250m or 8% of risk-weighted assets is required as capital to establish a bank. The investor must then supply the information required by the Banks Act on banking license application form DI 002.
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The following information must be included:
• Details of the applicant and the proposed bank, including notice of registered office and postal address of company;
• Memorandum and articles of association;
• Certificate of incorporation;
• Business plan (including predominant business activities planned, schematic representation of group structure, dividend policy, auditors, risk management policy and names of directors and executive directors);
• A number of Banks Act returns, referred to as ‘DI returns’, to forecast the position for the ensuing year are required. The forecast DI returns required are those dealing with the balance sheet, off-balance-sheet activities, income statement, liquidity risk, capital adequacy, trading risk, and restriction on investments, loans and advances;
• Curriculum vitae of proposed directors and executive officers;
• Application for approval of appointment of auditors;
• A report from a public accountant on funds received from anticipated shareholders and held in trust;
• Planned internal audit activities; and
• Application for permission to acquire shares in a bank.

A Branch of an International Bank or Banking Group

Should a foreign bank seek to establish a subsidiary or a branch in South Africa, the procedures are similar to those for other investors as set out above.

However, foreign banks are also required to include the following with their application:
• Foreign bank holding company resolution approving proposed formation of a bank;
• Letter of comfort and understanding from foreign bank holding company;
• Letter from the foreign bank’s home regulatory authority to the effect that it has no objections to the application and that it will comply with certain minimum standards of supervision; and
• Board minutes from the holding company empowering an official to sign all documents relating to the application.

Approval time for a banking company, a foreign subsidiary or a branch depends on the quality of the application. Banking licenses are not transferable.

A Representative Office of an International Bank

The requirements for establishing a representative office are less onerous, and it takes considerably less time to obtain approval for a representative office. Such offices cannot take deposits; they can merely act as information conduits to the parent company.

For more information, please contact:

The Registrar of Banks - South African Reserve Bank
Tel.: +27 (12) 313 3196
Fax: +27 (12) 313 3758
Website: www.reservebank.co.za

 
Ms. TSD Nxumalo Consul-General
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