CISCA
Collective Investment Schemes Control Act
Regulates the licensing, governance, and operation of collective investment scheme management companies, including trustee/custodian oversight and manager fit and proper requirements.
Sections
3
Duties
3
Questions
4
Assessment from
R 60 000
What it covers
The Collective Investment Schemes Control Act 45 of 2002 (CISCA) governs the establishment and operation of collective investment schemes (CIS) — unit trusts, money market funds, and similar pooled investment vehicles — in South Africa. While the detailed pricing, valuation, and portfolio composition rules sit in regulations made under CISCA (covered separately), the Act itself establishes the foundational licensing and governance architecture: every CIS manager must be licensed by the FSCA, must appoint an independent trustee or custodian (a separate, FSCA-approved entity responsible for safeguarding scheme assets and providing independent oversight of the manager's compliance with the scheme's deed and CISCA), and must satisfy fit and proper requirements for directors and key staff. The trustee/custodian relationship is a structural safeguard unique to CIS regulation — the trustee acts as an independent check on the manager, with specific statutory duties to monitor compliance and report material breaches to the FSCA. CISCA also governs the scheme deed (the founding document setting out the scheme's investment policy, fee structure, and operational rules), requires manager financial soundness (minimum capital requirements), and provides for FSCA intervention including suspension of repurchases/sales in extreme circumstances to protect investors.
Does this apply to you?
It applies if
- Your organisation manages or sponsors a unit trust, money market fund, or other pooled collective investment scheme offered to the public
- Your organisation acts as a trustee or custodian for a collective investment scheme
- Your organisation distributes or markets units in a collective investment scheme on behalf of a manager
Thresholds that change what's required
- All CIS managers require FSCA licensing regardless of the scheme's size or the number of investors
- Different categories of scheme (general equity, money market, fund-of-funds, hedge fund CIS) may have specific additional requirements
Exemptions
- Certain private investment pooling arrangements that do not constitute a public offering or solicitation may fall outside CISCA's scope — this determination requires careful legal analysis given the broad definition of 'collective investment scheme'
What non-compliance costs
Maximum fine
R 10 000 000
Imprisonment
Up to 10 years for operating an unlicensed collective investment scheme or for fraudulent conduct in connection with scheme management
Civil exposure
Investors may pursue civil claims for losses caused by manager negligence or breach of the scheme deed; the trustee's independent oversight role is specifically designed to provide an additional layer of investor protection beyond the manager itself
Reputational
FSCA enforcement action against a CIS manager, particularly involving suspension of dealing in scheme units, causes severe and often permanent reputational damage and investor flight from affected schemes
What the assessment covers
The assessment works through 4 questions across 3 duties, scored out of 50. Each answer generates the specific actions needed to close or prove that duty — and a “yes” only counts once its evidence is in, which is what makes the score defensible rather than self-declared.
The questions themselves are part of the assessment.
Find out where you stand on CISCA
Run the assessment, get your score, and get the exact list of what to fix — with the evidence trail an auditor will ask for.