South Africa Publishes Draft Capital Flow Management Regulations For Public Comment

*Update: Since publication, National Treasury has re‑uploaded the Media Statement and revised the public comment deadline to 18 May (previously 10 June).

The National Treasury published the Draft Capital Flow Management Regulations, 2026 for public comment on Friday, 17 April 2026. The draft regulations represent a fundamental overhaul of South Africa's exchange control framework, moving away from the pre-approval model towards a risk-based system focused on reporting, surveillance of high-impact and high-risk cross-border transactions and combating illicit financial flows.

Key changes in the draft regulations

We summarise below some of the key changes proposed in the draft regulations:

• Crypto Asset Regulation
  A key feature of the draft regulations is the proposed regulation of crypto asset transactions and the introduction of the concept of "authorised crypto asset service providers"—crypto asset service providers licensed under the Financial Intelligence Centre Act who are authorised by National Treasury to facilitate import and/or export of capital, directly or indirectly using crypto assets.
  We will address these proposals further in a separate article.
• Administrative sanctions on regulated entities
  The draft regulations propose a new administrative sanctions regime for authorised dealers and authorised crypto asset service providers in respect of regulatory breaches. Sanctions may include financial penalties, public reprimands, suspension or revocation of authorisation, disqualification of directors, senior management or key personnel, restrictions on permitted transactions and orders to take specified remedial action.
• Increased penalties
  If the regulations are implemented as currently proposed, penalties will be significantly increased. Persons convicted of offences under the regulations face fines of up to ZAR1,000,000, imprisonment for up to five years or both. Where the offence relates to money, crypto assets or property, the fine may be the greater of ZAR1,000,000 or the value of the relevant asset.
• Removal of ambiguity on the declaration of Foreign Assets
  The regulations propose to clarify and expand foreign asset declaration requirements. Under the draft regulations, persons in the Republic must declare foreign assets and crypto assets within 30 days of obtaining control or possession, or becoming entitled to sell or transfer those assets, specifying when and how the asset was acquired, where it is held, and whether it serves as cover for foreign liabilities.
• Clarification of restrictions on dealings in Non-Resident Securities
  The draft regulations propose clearer definitions of "controlled security" and "non-resident". Specific permissions from National Treasury or an authorised person would remain required for activities such as acting as nominee for non-residents or making entries in securities registers involving non-residents.
• Exemptions and Transitional Arrangements
  The regulations propose a modernised exemptions framework, allowing National Treasury or authorised persons to exempt classes of persons or transaction types from compliance requirements.

Next steps – public comment process

Written comments on the draft regulations must be submitted to National Treasury by 10 June 2026. National Treasury and the South African Reserve Bank will consider these written comments and make appropriate revisions where necessary.

Following promulgation of the final regulations, relevant manuals will be updated and various exemptions considered to facilitate the transition to the new capital flow management system.

The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.