Promotion of Access to Information Act (PAIA)
The Promotion of Access to Information Act, No 2 of 2000 was enacted to give effect to the constitutional right of access to any information held by any private or public body that is required for the exercise or protection of any rights. Certain requirements, however, have to be met for access to any information being granted.
The Act requires that a manual be prepared to assist people in exercising their right of access to information.
Conflict of Interest
The FAIS General Code of Conduct* requires Financial Services Providers (FSPs) and Representatives to adopt, implement and maintain a conflict of interest management policy.
*The General Code of Conduct is published in terms of the Financial Advisory and Intermediary Services (FAIS) Act, 2002.
The conflict of interest management policy defines potential conflicts of interest in the rendering of financial services to our clients, how they can arise within our business and how we should deal with them as a Licensed Financial Services Provider (FSP).
This is an extensive legal document with many definitions and guidelines, but in simple terms, a conflict of interest arises when we as a Financial Services Provider and/or our representatives have an actual or potential interest (money, reward or ownership) that influences the objectivity of our advice and/or service obligations to our clients. In other words, if specific financial products and/or services are recommended to clients purely because of its financial reward for the FSP, it would constitute a conflict of interest. The purpose therefore of the conflict of interest legislation is to ensure that we act objectively and in the best interests of our clients at all times. Receiving any financial reward or compensation, at the expense of our clients or to their own financial detriment, is not only considered unethical in our business but also contravenes the requirements of the FAIS Act.
Only the following financial interests may be offered and received:
- Commission and fees authorised under legislation;
- Fees other than those mentioned above, where the fees are agreed to by parties in writing and may be stopped by a party;
- Fees/remuneration for rendering of a service to a third party, however, fees must be reasonably commensurate to the service;
- An immaterial interest which is a financial interest that does not exceed R1 000 in any calendar year from the same third party in that calendar year.
- Financial interest other than those mentioned above, which consideration, fair value or remuneration is reasonably commensurate to the value of the financial interest is paid by that provider and it representative.
So how do we manage actual or potential conflicts of interest?
The directorship of the FSP has defined and implemented specific management procedures that enable us to identify and avoid wherever possible any such conflicts of interest. Where it is not possible to avoid such conflicts, we will advise our client/s of it in writing at the earliest reasonable opportunity and mitigate the conflicts of interest in accordance with our conflict of interest management policy. This policy also stipulates the remedial and disciplinary actions to be taken in the case of non-compliance with any of its provisions. All conflicts of interest must be properly disclosed in our conflicts of interest register and reported to our compliance officer, who is responsible for monitoring adherence to the conflict of interest management policy. Our compliance officer must also submit a report to the FSB Registrar on the implementation of and compliance with this policy. All representatives of Point 3 Financial Solutions (Pty) Ltd are required to sign a bi-annual conflicts of interest declaration to confirm their compliance with the policy. Our register of associates is also available for inspection on request.
As professional financial planners and investment managers we must, at all times, be rendering financial services in the best interests of our clients and to their benefit, an undertaking we at Point 3 Financial Solutions (Pty) Ltd are entirely committed to.
A copy of the Point 3 conflict of interest management policy can be obtained here or on request from Mark Botes on +27(12) 346 4111.