Introduction

Trusts have historically served as vital instruments within South Africa’s legal framework for estate planning, asset protection, and the preservation of wealth across generations. Historically, one of the defining features of a trust has been a degree of confidentiality, particularly in relation to the identity of beneficiaries and the control of trust assets. This position has, however, undergone a fundamental shift on 1 April 2023. The introduction of mandatory beneficial ownership disclosure requirements under the Trust Property Control Act 57 of 1988 (“Act”) marks a significant departure from traditional notions of privacy toward a regulatory framework grounded in transparency and accountability.

The legislative amendments must be understood within the broader context of South Africa’s efforts to strengthen its anti-money laundering and counter-terrorist financing regime. Following South Africa’s grey listing by the Financial Action Task Force in February 2023, the country committed to implementing reforms to enhance the transparency of legal persons and arrangements, including trusts. The amendments to the Act form part of this policy response to ensure that natural persons who ultimately own, control, or benefit from trust property can readily be identified by competent authorities. This initiative seeks to prevent the misuse of trusts for illicit purposes, such as money laundering and the concealment of beneficial ownership.

Beneficial ownership: legal position

The amended Act introduces a broad definition of beneficial ownership, encompassing any natural person who ultimately owns, exercises control over, or derives benefit from a trust arrangement. This will typically include the founder or donor of the trust, the trustees in their capacity as controllers of trust property, and the beneficiaries, whether their interests are vested or discretionary. It may also include individuals who have the authority to appoint or remove trustees, as well as any person who, directly or indirectly, exercises effective control over the trust.

Statutory obligations imposed on trustees

The amendments to the Act impose a series of ongoing statutory obligations on trustees, which extend significantly beyond traditional fiduciary duties. Trustees are required to compile and maintain an accurate and up-to-date register of beneficial owners, which must include prescribed identifying particulars and be supported by appropriate verification documentation. In addition, trustees are required to lodge beneficial ownership information with the Master of the High Court (“Master”) and to ensure that such information is always kept current. These obligations are continuous in nature, requiring trustees to monitor and record any changes in beneficial ownership without delay. Furthermore, trustees are obliged to disclose their representative capacity and the trust-related nature of transactions to accountable institutions, while maintaining accurate beneficial ownership information that such institutions may obtain during their client due diligence obligations.

Consequences of non-compliance

Non-compliance with the amended provisions of the Act carries significant legal and financial consequences. Trustees who fail to establish or maintain the required beneficial ownership register or who provide inaccurate or misleading information may be subject to administrative sanctions imposed by the Master. In more serious cases, such conduct may give rise to financial penalties and potential criminal liability. Beyond regulatory sanctions, trustees may also face personal liability where their failure to comply constitutes a breach of fiduciary duty or results in prejudice to beneficiaries or third parties. The increased enforcement framework underscores the importance of strict compliance and reinforces the elevated standard of care now expected of trustees.

Conclusion

The amendments to the Act have fundamentally altered the regulatory framework governing trusts in South Africa.

The position is now unequivocal:

Trusts are no longer lightly regulated private arrangements, but rather structured vehicles subject to significant transparency and compliance obligations. Trustees are required to adopt a proactive and informed approach to administration, ensuring that they are always fully compliant with their statutory duties.

VDMA’s team of experts is available to assist with compliance with beneficial ownership requirements, the review of trust structures, and the preparation of all necessary documentation to ensure legal and regulatory compliance.

Published 30 April 2026