Natural persons, South African resident trusts and corporate entities who created so-called loop structures into the Republic of South Africa (the Republic) on or before 28 February 2010 may submit an Exchange Control (Excon) Voluntary Disclosure Programme (VDP) (hereinafter Excon VDP) application, in terms of Regulation 24 of the Exchange Control Regulations, 1961, as amended, via an Authorised Dealer (commercial bank). Reinvestment in, or loops into, other Common Monetary Area (CMA) countries such as Lesotho, Namibia and Swaziland do not qualify under the Excon VDP.
“Loop structures” entail the formation by a South African resident of an offshore structure which, by reinvestment in the Republic, acquires shares, loan accounts or some other interest in a South African resident company or a South African asset. These transactions, contravene, inter alia, Regulation 10(1)(c) of the Exchange Control Regulations, 1961.
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