Trustees take note! How to record your beneficial ownership structure

In a previous article we unpacked the introduction and meaning of the new ‘beneficial owner’ definition introduced into the law of trusts by the General Laws (Anti-Money Laundering and Combatting Terrorism Financing) Amendment Act 22 of 2022 (“Amendment Act”). With these changes being effective as of 1 April 2023, trustees should be awake to the proposed process for recording and submitting your trust’s beneficial ownership information to the Master of the High Court.

For ease of reference we repeat the new definition of ‘beneficial owner’ which in the context of a trust includes any the following:

  • The natural person(s) who directly or indirectly ultimately own the trust property.
  • The natural person(s) who exercises effective control over the administration of the trust arrangements that are established pursuant to a trust instrument.
  • The founder of the trust and all natural persons ultimately behind the founder, if same is a legal person, partnership, or trust.
  • Each trustee of the trust, and all natural persons ultimately behind the trustee(s), if same is a legal person, partnership, or trust.
  • Each beneficiary of the trust, and all natural persons ultimately behind the beneficiary, if same is a legal person, partnership, or trust.

Trustees are now required to comply with the following obligations in respect of the trust’s beneficial ownership as introduced by the amended section 11A of the Trust Property Control Act (“Trust Act”):

  1. Establish and record the beneficial ownership of the trust and keep a record of the prescribed information relating to beneficial owners of the trust, which, according to the draft regulations to the Trust Act, will include for each beneficial owner, his or her full names, date of birth, nationality, official identification number, residential address, other means of contact, the reasons why the person is a beneficial owner, the date upon which he or she became a beneficial owner and the date upon which he or she ceased to be a beneficial owner.
  2. Lodge a register of the prescribed information on the beneficial owners of the trust with the Master of the High Court, and ensure that the prescribed information is kept up to date.
  3. Place on record and keep a certified copy of the official identification document of each beneficial owner, which copy must align with the prescribed information to be submitted for each beneficial owner.

The recording of the information is intended to happen via a digital portal through which trustees will have to submit the required information to the Master. All information so recorded in the Master’s register will be made available to enforcement agencies and will form part of the broader pool of data being collected on the ownership and control of South African entities.

So, trustees, take note of the new requirements and make sure that you are ready to comply. And remember, trustees who do not comply, expose themselves to fines up to R10 million and possible imprisonment of up to 5 years or both.

Our dedicated Trust Office team assists our trust clients with all of the new reporting and disclosure requirements and can also help your trust do the necessary.
Contact our Trust Team for assistance or find more information on our dedicated webpage.

Also keep an eye out for our follow up articles in which we explore in more detail the other areas affected by the Amendment Act as well as our online webinars on these new anti-money laundering amendments.

Disclaimer: This article is the personal opinion/view of the author(s) and is not necessarily that of the firm. The content is provided for information only and should not be seen as an exact or complete exposition of the law. Accordingly, no reliance should be placed on the content for any reason whatsoever and no action should be taken on the basis thereof unless its application and accuracy has been confirmed by a legal advisor. The firm and author(s) cannot be held liable for any prejudice or damage resulting from action taken on the basis of this content without further written confirmation by the author(s).

April 18, 2023

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