Sub Advisor Agreement Template for South Africa

The Sub Advisor Agreement is a critical document used in the South African financial services sector when a primary financial advisor or financial services provider wishes to engage another professional to provide specialized advisory services or support their existing client relationships. This document is essential for compliance with South African financial regulations, particularly the FAIS Act, and establishes clear parameters for service delivery, risk management, and client protection. The agreement typically includes detailed provisions for regulatory compliance, compensation structures, operational procedures, and data protection requirements under POPIA. It's particularly relevant in situations where specialized expertise is needed or when firms are scaling their advisory capabilities while maintaining regulatory compliance and service quality.

1. Parties: Identification of the primary advisor and sub-advisor, including their regulatory status and licenses

2. Background: Context of the agreement, including the primary advisor's business and need for sub-advisory services

3. Definitions: Key terms used throughout the agreement, including regulatory terminology

4. Appointment and Scope: Formal appointment of sub-advisor and detailed scope of services to be provided

5. Regulatory Compliance: Obligations regarding FAIS Act, FICA, and other regulatory requirements

6. Duties and Responsibilities: Detailed obligations of both parties, including service standards and reporting requirements

7. Fees and Payment: Compensation structure, payment terms, and related tax considerations

8. Representations and Warranties: Statements of fact and assurances from both parties, including licensing and capability confirmations

9. Confidentiality and Data Protection: Obligations regarding client information and compliance with POPIA

10. Intellectual Property: Ownership and usage rights of materials, systems, and methodologies

11. Risk and Compliance: Risk management procedures and compliance monitoring requirements

12. Duration and Termination: Term of agreement and circumstances for termination

13. Post-Termination Obligations: Continuing duties after agreement ends, including client transition and record retention

14. General Provisions: Standard legal clauses including notices, amendments, and governing law