Change On "Loop" Structures Opens Up Bermuda, BVI, Cayman, Guernsey And Jersey Wealth Structuring Options For South Africa Residents

With reform of South Africa's Exchange Control Rules, the restrictions on the use of "loop" structures have been lifted so that South African residents are no longer prohibited from using funds or assets held in offshore structures to invest back into South Africa.

In simple terms a "loop" structure was generally created when South African resident individuals, companies, trusts and private equity funds transferred funds or assets from South Africa into a foreign structure, which then directly or indirectly invested the funds or assets back into South Africa. The restrictions have been lifted to promote inward investment by South Africans into South Africa, subject to the normal criteria applying to inward investments and reporting to the Financial Surveillance Department.