Although South Africa has had exchange control since 1939, the current governing legislation is set out in the Exchange Control Regulations “Regulations” promulgated in 1961 in terms of the Currency and Exchanges Act, 1933 “the Act”.
The Act, and more specifically Section 9 of this forms the foundation of exchange control in South Africa. Section 9 (1) of the Act provides that the President may make regulations in regard to any matter directly or indirectly relating to or affecting or having any bearing upon currency, banking or exchanges.
The current set of Regulations was promulgated in 1961 and amended from time to time. In terms of these Regulations, the control over South Africa’s foreign currency reserves, including accruals thereto and spending thereof, is vested in the Treasury.
The Minister of Finance has also in terms of Section 9(5) (a) of the Act issued Orders and Rules under the Regulations and the current set was published in 1961 and amended from time to time. The Orders and Rules contain various orders, rules, exemptions, forms and procedural arrangements.
The Exchange Control Rulings, “the Rulings” are issued by the Financial Surveillance Department “FSD” of the South African Reserve Bank and contain certain administrative responsibilities as well as permissions, conditions and limits applicable to transactions in foreign exchange which may be undertaken by Authorised Dealers and/or on behalf of their customers.
The Minister of Finance has appointed certain banks to act as Authorised Dealers in foreign exchange. The Rulings are amended from time to time by way of Exchange Control Circulars.
The Rulings and Circulars are made available to all Authorised Dealers and although for their use only, are not secret and the contents thereof may be made available to the public. The Rulings must be read in conjunction with the Regulations.