Sentinel International, a leading South African trust service provider, is among the trustees encountering difficulties in complying with the updated regulations of the Trust Property Control Act.
These regulations, which require trustees to provide information on “accountable institutions” and “beneficial owners” of trusts, were announced just hours before they came into effect on 31st March 2023. Failure to comply with the regulations could result in severe penalties, including fines of up to R10 million or imprisonment for up to five years, under Section 19(2) of the Trust Property Control Act.
The Trust Property Control Act defines a “beneficial owner” as any natural person who either directly or indirectly owns or controls a trust’s property, or who exercises ultimate effective control over a trust through direct or indirect means. This definition is essential because it helps to identify those with a significant interest in a trust and must, therefore, be disclosed to the Master of the High Court (the “Master”). The disclosure requirement aims to promote transparency and prevent trusts from being used for illicit activities, such as money laundering and terrorism financing.
To comply with the new regulations trustees are required to upload details about the “beneficial owners” of trusts where it serves as a trustee, using the recently launched Master portal. The portal allows for the maintenance of electronic registers by the Master. Although the Masters’ offices initially faced capacity challenges, they have now implemented an interim electronic solution through the Master portal, which enables trustees to upload electronic registers.
Sentinel’s trust teams have begun capturing the necessary information through the portal, which involves the initial capture of basic trust details and details of the person capturing the “beneficial ownership” information, followed by the upload of a populated Excel file containing the “beneficial owners” of that trust. Sentinel is treating submissions with the utmost urgency and will submit them as soon as possible.
Although trustees who are unable to upload the information electronically can visit any Master’s Office for assistance, Sentinel believes that this may not be practical at present, given the capacity challenges faced by the Masters’ offices.
Sentinel requests that clients provide any information required in a timely manner if they contact them for the same.
Clients can visit our website at www.sentinelinternational.co.za for more information on all our services.