Financial Sector to Transition to COFI Framework

The Financial Sector Conduct Authority will automatically relicence current institutions under the new conduct regime.

Updated on Oct. 15, 2026 in Financial Planning

Financial Sector to Transition to COFI Framework

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The Financial Sector Conduct Authority (FSCA) will move existing financial institutions into the new Conduct of Financial Institutions (COFI) framework without requiring new applications. This streamlined transition will use a structured approach based on current activities, products, and customer profiles.

Why it matters

The COFI framework aims to create a single, unified market conduct regulation system in South Africa to replace the current fragmented sectoral laws. By automating the relicensing process for existing entities, the regulator intends to ensure a stable and consistent transition for the industry.

The FSCA is mandated to publish its proposed relicensing approach at least six months before the relevant COFI provisions become operational. The regulator must still finalise the phased transition methodology for different categories of entities.

The players

Financial Sector Conduct Authority

This is the primary regulatory agency responsible for market conduct in the South African financial sector.

National Assembly

This is the legislative body tasked with reviewing and ultimately passing the COFI Bill.

Werksmans Attorneys

This is a South African law firm that provides legal analysis on corporate and regulatory developments.

The details

The regulator will map current permissions to the new framework by evaluating the activities, products, and customer bases of established firms. While current institutions will be transitioned automatically, new market entrants will be required to apply for authorisation under the COFI regime once it officially takes effect.

March 2026: Cabinet approved the COFI Bill for submission to Parliament.
17 April 2026: A formal notice regarding the COFI Bill was published in the Government Gazette.
2 June 2026: Werksmans Attorneys released an analysis of the impending framework changes.
13 October 2026: The FSCA discussed the relicensing strategy at the FIA Advice Summit.

Market Dynamics

The transition to the Conduct of Financial Institutions Bill represents a shift from fragmented sectoral supervision to a unified regulatory model for South Africa. This consolidation aligns the market with modern global standards for institutional accountability.

Existing clients can expect stability as their financial institutions transition to the new framework without the need for service interruptions. Institutional investors should monitor official government updates to confirm when the new conduct standards will be fully implemented.

The takeaway

The move to a single conduct regime simplifies the regulatory environment for established South African firms. Industry participants should monitor upcoming publications from the FSCA to ensure they are aligned with the new compliance requirements.