Last week a proposed bill (i.e. draft legislation) was published for comment. The law of Trusts is still regulated by the Trust Property Control Act from 1988, so it really needs an update. This new bill is a modern version of the old Act, pushing the regulation of Trusts towards the way Companies are administered, also with an eye on the SA context of misuse of Trusts and corruption, and FATF grey-listing and proper compliance with the FIC.
What’s newly proposed?
1. Better definitions, and directions for lodgement of Trust Deeds
2. Better control over Trustees, with at least one independent Trustee required
3. Trusts must account to the Master, which ensures better oversight. Annual financial statements and returns must be prepared (not audited)
4. Powers, duties and remuneration of Trustees are well set out
5. Beneficial ownership rules are restated (already in place after recent FICA amendments)
6. Penalties applicable to Trustees are becoming increasingly severe
7. In all, the bill requires a shift to more active and involved Trustees and a shift from secrecy to public accountability
Our comments? We hope that the Masters’ offices will be able to manage the increased workload, they are severely under strain already. Testamentary Trusts are included. Otherwise a good overhaul of dated legislation.