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FAIS Act FAIS Act and Subordinate Legislation
A company, 'Safe Deposits (Pty) Ltd', primarily sells safes. As a side-activity, a director, Mrs. Kanya, provides general advice on banking deposits. Under which specific circumstance would 'Safe Deposits (Pty) Ltd' be EXEMPT from needing an FSP license for this activity?
RE5 practice question with a worked answer. This is one of hundreds of FSCA RE5 questions in the RegulatoryExams question bank.
- a) The company receives a referral fee from the bank.
- b) The advice is given as part of a separate, paid financial seminar.
- c) The company is also a registered Bank (a Product Supplier) and the advice *only* relates to its own deposit products.Correct
- d) The advice is provided on behalf of another, licensed FSP.
Why this is the answer
The FAIS Act (Sec 2(1)) provides exemptions. A Product Supplier (like a bank) that provides advice *only* on its own financial products is generally exempt from needing a separate FSP license for that specific activity. Receiving fees (A, B) or acting for another FSP (D) would require licensing.
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