The Draft Regulation of Trusts Bill, 2026 may become one of the most significant developments in South African trust law in almost four decades. While it introduces substantially greater compliance and governance requirements, it does not diminish the value of trusts as planning structures. If anything, the proposed changes reinforce a principle that has become increasingly evident in recent years: a trust remains a powerful planning tool when it is properly established, actively administered, and managed in accordance with sound fiduciary principles.

The Draft Regulation of Trusts Bill should be seen as another important step in the evolution of the South African trust landscape. Against the backdrop of enhanced anti-money laundering measures and growing demands for transparency around ownership structures, the proposed legislation seeks to modernise trust regulation while expanding the oversight powers of the Master of the High Court.

Naturally, this raises an important question:
Are trusts still worthwhile planning vehicles in such an increasingly regulated environment?

The answer remains a clear ‘yes’.

The proposed legislation does not remove a trust’s fundamental benefits. Instead, it reinforces the need for trusts to operate as genuine fiduciary structures, rather than as convenient extensions of an individual's personal affairs.

The Trust itself is not under threat
It is understandable that increased regulation may raise questions about whether trusts are worth the effort. A growing perception exists that trusts are becoming too complex, too costly, or too heavily regulated to remain effective planning vehicles.

Such views may misunderstand the purpose of the proposed reforms.

The Bill does not seek to remove trusts from South Africa's legal landscape, nor does it restrict their legitimate use for wealth preservation, succession planning, asset protection, or the long-term holding of family assets.

Instead, the proposed reforms aim to improve transparency, strengthen governance, and enable effective regulatory oversight.

The fundamental advantages of a properly structured trust therefore remain unchanged. What is changing is the expectation regarding how that trust is governed and administered.

A shift from formation to governance
Perhaps the most significant message emerging from the Draft Bill is that governance matters.

Historically, considerable attention often went to creating a trust and drafting the trust deed, while ongoing administration received far less focus once the trust was established.

The proposed legislation signals a clear departure from that approach.

Trustees will be expected to actively fulfil their fiduciary responsibilities through proper record-keeping, annual financial reporting, maintaining beneficial ownership registers, and more regular engagement with the Master's Office.

In practical terms, the trust deed will no longer be viewed as the culmination of the process. Instead , it will serve as the foundation of an ongoing governance framework that requires continuous attention throughout the life of the trust.

Well-managed trusts are stronger trusts
The increased compliance burden contemplated by the Bill cannot be ignored. Trustees will undoubtedly need to devote more time and attention to administration, reporting, documentation, and governance processes than they have historically.

However, these developments should not necessarily be viewed negatively.

Well-administered trusts already maintain many of the records, controls, and governance practices contemplated by the proposed legislation. For these trusts, the Bill largely formalises standards that good fiduciary governance should require in any event.

The greater challenge will arise for trusts that have become dormant, poorly administered, or treated as extensions of personal affairs.

Those trusts are likely to face increased scrutiny and may need to make significant adjustments to meet the evolving regulatory expectations.

The road ahead
The Draft Regulation of Trusts Bill presents a significant shift in the way trusts will be regulated in South Africa, introducing enhanced transparency, expanded compliance obligations, and more active supervision by the Master of the High Court.

Importantly, however, the Bill should not be viewed as diminishing trusts' relevance.

On the contrary, it recognises the continuing role that trusts play in wealth preservation, succession planning, and fiduciary structuring. The challenge for trustees and advisers is, however, no longer simply establishing trusts correctly but ensuring that those trusts are properly governed throughout their existence and continue to serve families and businesses effectively for generations to come.

The future of trusts is therefore not defined by less relevance, but by higher standards. Governance, transparency, and accountability are no longer optional, but essential characteristics of a successful trust.


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