The implementation of the Property Practitioners Act 22/2019 (PPA) has introduced significant shifts in how the property industry is regulated in South Africa. To ensure all property practitioners remain compliant and informed, we have compiled the most critical updates regarding Fidelity Fund Certificates (FFCs), registration requirements, and the expanded scope of the industry.
1. The Move to “Floating” FFCs
The most fundamental change under the PPA is the introduction of industry-based or “floating” FFCs.
- Natural Persons: Unlike the previous framework, where FFCs were strictly tied to a specific firm, a natural person now receives a single FFC for all capacities in which they act within the same industry.
- Independence: Principals and employees now hold their own floating FFCs, which are no longer interdependent with the firm’s FFC.
- Firm Responsibility: Because individual FFCs are no longer linked to a firm’s renewal, firms must now independently renew and issue their own FFCs. A firm’s FFC will only generate if its principal holds a valid floating FFC.
2. Expanded Scope: The 12 Regulated Industries
The PPA now covers 12 distinct categories of property practitioners. It is essential to determine which category your business falls under, as operating in multiple industries requires registration and a separate FFC for each. The categories include:
- Estate Agents
- Auctioneers
- Bond and Bridging Finance Originators
- Homeowners’ Associations (performing practitioner activities)
- Managing Agents
- Property Facilitators and Intermediaries
- Business Brokers
- Developers (marketing and selling their own property)
- Time Share and Fractional Ownership Practitioners
- Property Advertising Platforms
- Payment Processing Agents
- Attorney Employees
3. Changes in Fees and Trust Accounts
The financial structure of registration has also evolved:
- Who Pays: Only natural persons pay the standard 3-year FFC renewal fee.
- Firm Admin Fees: While firms do not pay for an FFC itself (as per Regulation 15.1), they are required to pay a R640 admin fee to cover the costs of issuing the certificate.
- Trust Account Exemptions: Firms that do not receive trust money can now apply for an exemption from holding a trust account.
4. The Registration Process
The PPRA is currently transitioning to a new Registrations and Licensing portal (SAP system) to streamline applications.
- Estate Agents: Principals must still provide qualifications, and employees are registered as candidates or full-status agents.
- Non-Estate Agents: Currently, no standards of training apply to industries like auctioneers or developers, though directors and employees must still register.
- Required Documentation: Business applications require CIPC documents, a bank letter (or trust exemption), a valid BEE certificate, and a SARS tax clearance certificate.
5. Compliance and Turnaround Times (Section 49)
Practitioners should be aware of the statutory turnaround times for applications:
- The Authority has 30 working days to consider a fully compliant application.
- If the Authority fails to meet this deadline, the application is deemed approved, and the practitioner may request the certificate be issued within 10 working days.
- Note: This “deeming” provision only applies if the application was fully compliant from the start.
Important Reminders for Success
To avoid delays, the PPRA emphasises accuracy and clarity in all communications. Always include your PIN number in enquiries, and ensure all documents are sent in separate folders or attachments. For escalations regarding registration matters, practitioners should first contact the Executive Manager before approaching the CEO.
Stay informed by regularly checking for updates and notices on the official PPRA website.
Get in touch with Realty Solutions today should you need assistance.
Samantha Woods – 079 426 6070 / samantha@realtysolutions.co.za
