Overview of Problems Associated with Ineffective Enforcement of Market Abuse Provisions in South Africa

Abstract

South Africa had anti–market abuse legislation in place since the late 1990s but nonetheless the enforcement of such legislation to combat market abuse activities has been inconsistent and problematic to date. The objective of this article is to provide an overview analysis of some factors that have to date contributed too many challenges that are associated with the inconsistent enforcement of the market abuse laws in South Africa. This is primarily done to increase awareness on the part of the general public, policy makers and other relevant stakeholders and to innovate possible solutions to such challenges in order to enhance the enforcement of the market abuse ban in South Africa. In relation to this, the article seeks to explore these enforcement problems by, first, taking a closer look at the effectiveness of the Financial Services Board (the FSB) as the market abuse national regulatory body in South Africa. Secondly, the co–operation between the FSB and other similar local and international enforcement bodies will be examined. Thirdly, the adequacy of the available resources, penalties and remedies will be discussed. Lastly, the adequacy of the market abuse preventative measures that were adopted in South Africa will be discussed.

DOI: 10.5901/mjss.2014.v5n4p47