In 2016, South African National Treasury introduced an exemption
from securities transfer tax ("STT") for
listed securities that are transferred outright (as opposed to
pledged) as collateral, provided that such transfers adhere to a
number of conditions that were outlined in the definition of a
"collateral arrangement" in the Securities Transfer Tax
Act, 2007. Then, in 2017, the period for which a collateral
arrangement was permitted to remain outstanding and exempt from STT
was extended from 12 months to 24 months.
Now that the initial flurry of excitement has died down and the
various industries have had time to try to structure collateral
arrangements into their derivative, securities lending and other
structured deals, a few uncertainties have come to light.
