In PPRA Notifications

The Estate Agency Affairs Board (EAAB), as the Supervisory Body of the estate agency sector, plays a key role in overseeing the implementation of the FIC Act within the sector. It is self-evident that the implementation, compliance and enforcement of the FIC Act, including customer due diligence and the application of the risk-based approach, requires continuous engagement between the EAAB and estate agency enterprises.  

A transitional period was granted by the Financial Intelligence Centre (the FIC) to enable full compliance with the new requirements of the FIC Act to be achieved by the sector. That transitional period ends on 1 April 2019 from which date all estate agency enterprises must ensure full compliance with the provisions of the FIC Act.

The EAAB will, in the interim, continue to oversee the implementation of the FIC Act by the sector especially as estate agency enterprises undergo the period of transition enabling them to meet the new customer due diligence and risk-based requirements.  The EAAB will, during the changeover period, continuously liaise with the FIC and also apply a risk-based supervisory approach to ensure knowledge of, and compliance with, the FIC Act by estate agency enterprises both large and small. The EAAB has, thus far, primarily engaged with the sector through its Continuing Professional Development programme which was used as an available vehicle to enable the FIC to advise estate agency enterprises on the implementation of any required remedial actions to avoid any non-compliance with the FIC Act.  This interaction will be significantly broadened to ensure compliance with the FIC Act by the sector after 1 April 2019 and the EAAB will be implementing positive steps in this respect.< /p>

Estate agency enterprises must start demonstrating progress towards full compliance with the requirements of the FIC Act. To achieve this objective the EAAB, together with the FIC, will utilise such measures as inspections and other available oversight activities to monitor, guide and advise estate agency enterprises on the correct implementation of the amended FIC Act. In so doing both the EAAB and the FIC are mindful of the fact that the larger enterprises may well be better resourced and equipped to satisfy compliance expectations more quickly than might be the case with smaller enterprises.

The FIC has indicated that the sanctioning of non-compliance with the new requirements of the FIC Act will be delayed to allow sufficient time for estate agency enterprises to make the required implementation adjustments. The process of implementing the new FIC Act requirements will take account of any imbalances and inconsistencies that may be found to exist within the estate agency sector. Since the sector plays a critical role within the South African economy as a whole there is a definite sense of urgency in ensuring and expediting full compliance with the risk-based and customer due diligence approaches now embodied in the FIC Act.

The EAAB has created comprehensive study material specifically designed to assist estate agency enterprises to meet their FIC Act compliance obligations in the most ‘user-friendly’ manner possible. This material will be placed on the EAAB website where it will be available for perusal by all role-players within the estate agency sector. Estate agents, and particularly principal estate agents, are urged to access that material as soon as possible and to thoroughly acquaint themselves with its contents. The material will henceforth be included in the prescribed study material for the Professional Designation Examination for principal estate agents (PDE 5). The EAAB is, in addition, presently compiling a draft Risk Management and Compliance Programme (RMCP) template for use by estate agency enterprises, which will supplement the published material. The RMCP template will, similarly, be placed on the EAAB website immediately it has been finalised.

It is hoped that the new study material, used in conjunction with the proposed RMCP template, will play a significant role in enabling full compliance by the estate agency sector with the FIC Act sooner rather than later.

Issued by:       The Estate Agency Affairs Board

Date:               19 November 2018

See below for study material


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