Following months of delays, President Jacob Zuma has signed the Financial Intelligence Centre Amendment (FICA) Bill into law.
The Presidency on Saturday said the legislation, which amends the Financial Intelligence Centre Act signed in 2001, will "strengthen the transparency and integrity of the South African financial system in its objectives to combat financial crimes, including tax evasion, money laundering, the financing of terrorism and illicit financial flows".
Opposition parties in Parliament had pressured President Zuma to sign the bill which had been tabled in April 2015. Stronger legislation was argued as necessary to ensure the country is in line with the standards of the Financial Action Task Force (FATF) - an intergovernmental body promoting national policy to prevent money laundering - of which South Africa is a member.
President Zuma sat on the bill for months until the Council for the Advancement of the South African Constitution (Casac) had filed papers at the Constitutional Court in November last year. He subsequently referred the bill back to Parliament, expressing concerns over the constitutionality of clauses allowing for warrantless searches.
Now that legislation has finally been passed, Casac's executive secretary Lawson Naidoo told HuffPost SA it is unfortunate it took so long for the matter to be completed. "We welcome the fact that the bill has finally been signed, but it is regrettable we had to endure this long, arduous process to get here," he said.
"We hope now that the provisions in the Act that deal with issues around tax evasion, money laundering and so on can be dealt with effectively by the agency mandated to do so," he said.
The Democratic Alliance's finance spokesperson David Maynier on Saturday expressed concern over whether the Financial Intelligence Centre (FIC), with a budget of R289-million for 2017/8, would have the resources to effectively implement FICA.
Naidoo said if there are issues with the FIC's capacity to implement the legislation, it will need to raise these concerns with parliament. "The primary issue has been around getting the legislation in place. Obviously the capacity of the agency to implement this is equally important, but we should stay focused on the fact that we now have the legislative framework in place," he said.
Maynier, in a DA press release, said implementation of the Act may be delayed by finance minister Malusi Gigaba in light of the legislation's directive to monitor the "business relationships, sources of wealth and sources of funds of 'domestic prominent influential persons'".
"This means that President Jacob Zuma and his most important clients, the Guptas, are going to feel the heat as their business relationships, sources of wealth and sources of funds are subjected to ongoing monitoring by financial institutions in South Africa," he said.
Meanwhile, the Banking Association of South Africa (Basa) said it is relieved FICA has been signed into law, according to a report by the BusinessDay.
Managing Director Cas Coovadia told Business Day on Saturday the Bill will ensure South African banks "remain at the cutting edge of global best practice and that we are able to identify and deal with money laundering, terrorism financing and other such activities".
The legislation will commence on a date to be announced by Minister Gigaba. Maynier, however, said "the battle is far from over" and he will request a meeting with Yunus Carrim, Chairperson of the Standing Committee on Finance, to probe the readiness of the FIC to implement the amendments to legislation.Suggest a correction