South Africa’s National Treasury consults on amendments to enable transition from JIBAR to ZARONIA and extend procurement review timelines

South Africa’s National Treasury has published for public comment a draft amendment bill that would update the Financial Sector Regulation Act, 2017 and the Public Procurement Act, 2024. The proposals would create a legal framework for strengthening official financial benchmarks, including replacing the Johannesburg Interbank Average Rate (JIBAR) with the South African Rand Overnight Index Average (ZARONIA) administered by the South African Reserve Bank, and would revise statutory timelines for reviewing the Public Procurement Act’s implementation. For benchmarks, the draft Bill would insert a new chapter into the Financial Sector Regulation Act to provide for the designation and replacement of official benchmarks used in financial contracts and offering processes, mechanisms to replace benchmarks referenced in legacy contracts, limits on liability associated with using a designated replacement benchmark or designated adjustment spreads, and consultation process requirements for the South African Reserve Bank when replacing official benchmarks. For procurement, amendments to section 68 of the Public Procurement Act would extend the timeframes for the Minister’s post-commencement implementation review, preparation of a report, and submission to Parliament, citing that the Act has not yet taken effect pending finalisation of the regulations needed for implementation. Written comments are due by 31 December 2025. The National Treasury will workshop the draft Bill with stakeholders before submission to Cabinet, after which it will be processed for tabling in Parliament.