ACT No. XIII or 1.9!M AN ItCT ID corrf~r on '''~ Ma/ID InI~mtltionaJ BUJiMU Authority l~ /lUIcliOtlS of I~ Ma/Ill Financial Strvicts Cell /n, 10 chtulgt I~ nam.t of Iht Autho rity arid 10 makt ctffa/1I C01lStqlU!TIliai onundmtnls 10 IM Mo/w International Busmen Ac,ivi,iu Acl, Cap.330. (ameddmentof)

I assen t,

Uoo MIf'SUD BoNtOCl

President

13th September, 1994

(LoS .)

ACT No. XIII or 1.9!M

AN ItCT ID corrf~r on '''~ Ma/ID InI~mtltionaJ BUJiMU Authority l~

/lUIcliOtlS of I~ Ma/Ill Financial Strvicts Cell /n, 10 chtulgt I~ nam.t of

Iht Autho rity arid 10 makt ctffa/1I C01lStqlU!TIliai onundmtnls 10 IM

Mo/w International Busmen Ac,ivi,iu Acl, Cap.330.

BE IT ENACfED by the President, by and with the advia: and

consent of the House of Representative$, in this present Parliament

assembled, and by the IlI.IthorilY of the same, as follows:-

I. (I) T his Act may be ciled as the Malta International Business

AClivilies (Amendment) Act. 1994. and shall be read and construed as one

with the Malta International Business Activities Act, which sllall

henceforth and for the purposes of this Act and fot all effeclS and

purposes of this and any other law, be known as the Malta Fmancial

Services Centre Act, hereinafter refer=! to as "the principal Act",

(2) This Act shall come into force on such dale as the Minister

may by IJOtice in the Gazette appoint. and different dates may be

appoinu:d fOf differeru provisions and different p.!rposes of this Act.

Minnufib war.\·ar1ilrolu" ta' ' ·An printiplli ghandu jidhol dan

'·artikolu gdid Ii gcj

4A.(1) It-Centru jkollu wkoll i!.funzjonijic:1 u 1-

selghal51ipulati !i,·Ticlel Skcdl li tinsab ma' clan I·All

(2)

II -Bord ta' Gvemr.turl Iat-Centru. il·

Kumital Ettkultiv ticghu u j.impjcpti tiegbu D'II

jkunux responsabbli ghad-danni dwv dak li jsir jew

jonqos milli jsir fl-ckku7-ljoni jew f1-ctekuzzjoni

rnahsuba ta' xi funzjoni Wit clan I-A lt. kemm-il dart.

dale li jlir jcw jonqos li j sir j inlv,,:ra bhala 1i jkun SIlt

jcw naqu milti jlit, 5~d i\.1ut, in nMl, kdr.-,

(Section 31)

c-nJ FUDCtioas aod POWtrs

oItbeCen~

1. (I) WithOUl prejudice 10 any other funetions assigned or supcniN,

tlllDIfcued to the Centre by or under this O£ any other Act, it sbaII be the f",*,Ll:2~

duty of the Centre to exeteUe such supavisor'y functions in the fields of

banking. insurance. investment &ervices and similllf areas in lhe field of

financi al services. as may from time to time be assigned to the Centre by

or under an Act of ParliameDl.

(2) Without prejudice to sub-article (1) or this article, it shall

be the dUly oCthe Cmue, 50 far as pnttic:abIe from time to time:-

(a) 10 promOle and maintain adequate and rea501UlbJe financial

services for the public;

emure high Itandan1a cl cooduct and manqcmcnI

(b) 10

throuahout the financial systan;

(c) to keep under review the carryi ng 00 of tornme!cial and

financiallCtivities in Malta, and to coiled infonnalion with respect 10

such aclivitie5. and the pcrsoru by whom they are camed on, with a

view to its becoming aware of, and ascenaining the CircumSUUlCrt

relating to, mauers with respect 10 which its functions are exercisable

Id) 10 ftlCeive and con.c evidence beoJ.ning available to it with

respect to such activities as arc mentioned in the preceding paragraph

and which appear 10 it to be evidence of pmclices which may

adversely affect the economic interests 0( practitioners and ConswnCB

in those &rea$; and

(c) 10 further such policies not inconsistc:nt with this Aelas shall

be in the national interest.

(3 ) It shaU also be the duty of the Cent~, whe~ either it considers

it expedient or it is requested by the Mini5ter to do so:·

<a)

10 give information 10 the Minister with respect to any of the

mallen in respect of which the Cenm has any duliell under thU

article, or

(b) 10 make recommendations to the Minister aJ 10 any action

which in the opinion of the Cent re it would be expedient for the

Minister or any other Minister 10 lake in relation to any of the ~

in rapect of wlUcb the Cwllc bas luch duties.

2. (I) The Miniscer may at any time require the Centre to concfuct

an investigation and submit \0 him • repol1 on any of the mauen in

respect or which the Cmtre has any duties under this Act or any othcc

""""""

(2) Without prejudice to sub-article (I) of this article, the

investigations and reports rtquimi pursuant 10 that sub-article may in

particular have regard to specifIC or lef.aal aspects of the rcguIaOon of

commercial activitK:. in Malta which relate 10 banking. inslll1UlCe,

.semce..

investmnll: semce. IUId dmilar areaJ in the fteld of fmancial

3. ( I) TIle Centre shall arrange for the dissemiJUltion in such focm

and manner as it considel1 appropriate of such information and advice as

it may appear 10 it expedient 10 give the public in Malta about m.atlttI

...

rclatins 10 thc exercise of its functions under this Act or any other

,~

(2)

In arran gi ng for the publication of any such infonnation or

advice, the Centre shall have regard to the need to I'e5pcct the duty of

profCHional secrecy and, 10 far.s practicable, fOf exclud ing:·

(al any mattet which relates to tile private affain of an

individual, where the p.iblication of that matter would or might, in tl:le

opinion of tile Centre, aeriously and ~judkiaUy affoct the interes\.'l of

that individual: and

(b) any martc'r which rellllcs 5pCICirICaIly to the affain of a

particular body of penonl, whdhc:r corporate or unincorponlte, where

publication of that matter would or might , in the opinion of the Centre,

seriously and ~judk:ially affect the intt;restl of thaI body.

4. ( I) It .hall be the duly of the Centre to consider any matter

which:·

(al relates to the functions exetcill3ble by the Centre under this

Act or any other- enactment; and

is me subject of a representation (other than onc appearing

(b)

10 the Cenue 10 be frivolous) mlde 10 the Centre by QC on behalf of a

person appearing 10 the Centre to have an interest in that matter.

(2) Where any matter considered by the Centre under sub-

article ( I) above is one in respect of wllicb any of its functions is

exercisable, the Cenm shall, if it i$ required to do $() or if il thinks fit.

exercise lIllIl function whh respect to that mallet.

S. (1) The Centre dlall have power u) investigaIc any matter lnveati.ali(lll

wllich satisfies the conditions laid down in paragraphs (a) Md (b) of sub- of cunplaints.

article (I) of article 4 above.

Where the Centre has investigated any maner under this

(2)

article. it may prepare a report on that manor and (subject to respecting

tne duty of professional secrecy) shall send a copy of any such report to

soch (if any) of the following persons as il thinks nppropriate, that is to

say:-

(a) any pcl$O!l 10 whom thc repon refen or who appears 10 the

Centre to have an inlerest in the matter 10 which the report relates ;

(b) any person whose functions under any enactment appear to

the Centre 10 be CAen:isabie in rdation to that matter.

(c) any person who appears 10 the Centre 10 be a pcnon who

ought to take accoun t of the tepan in dctennining how to act in

relation 10 that matter.

6. Where it appears 10 !be Centre that any person may be: Inye.oti,1Iioa 0(

eon1rllvening 01" may have eon1rllvened any relevant cQfldition, m::juimMnl eoIIua..·nfion·

or enacunent, the Centre may, fOl" any purpose connected with the exercise

of its functions under this Act in relation to that malter, by notice:·

(a) require any person to produce, at a time and place specified

in tbc notice. to !be Cenlre 01" any pcJSOn appointed by it (01" the

purpose, any documenu which are specified or describc:d in the

notice and are in that penon's cuslody or under his control; or

(b) require any person carrying on any business to fW"nish to the

Centre such informalion 8$ may be specified or deo;c:ribed in the

notice, and sprei(y the lime, the manner and !be (orm in which any

such infonnation is to be furnished; bul no pciSOn shall be compcUcd

for any such purpose to furnish any infannation or produce any

documents which arc subjoct to the duty of professional secrecy.

7. ( I)

Without pR:judice to any liability under any other law, a

per10n who without reasonable excuse fails to do anything duly required

of him by a notice under anicle 6 of this schedule shall be guilty of an

offence IIIId liable on conviction \0 a fine (fl'lUlla) of up 10 twenty thousand

Maltese liri.

Without prejudice 10 any liability under any «her law, a

(2)

pel'5Of\ who inrentionaUy alIen, 'uppre!Se5 or desuoya; any documenI

whicb he bas been required by I noIice under article 6 above to produce

shall be guilty of an offcoce and liable on conviction to a flIE (mu/la ) of

up to twenty thousand MaI~ liri.

(l) Without prejlldM;e to any liability under any other law, if a

pel$Oll makes default in complying with a notice under article 6 of this

5Chedule. the coun may. OIl the application of the Cmlre, make &UCh order

as the coun thinb fit for lUjuiring the default to be made good; any such

order may provide that the costs or ~penses of and incidental to the

application shall be borne by the perwn in default or by any offICers of

any body corporate who are responsible for the default.

(4) Without prejudice to any liability under any other law, a

penon who, in furnishing any information or making any application

under or for the purposes of any provision of this Act, makes any

statemenl which he mows to be false in a material panicular, or

reck.lessly makes any sta!emcnt which is faLse in I mal.eriai panicular, lE

shall be guilty of an offence and liable. on conviction, 10 a fine (mu/la) of

up to twenty thousand Maltese liri.

Withool prejudice to any liability under any other Jaw, a

(j)

pa10Il who in any other way intentional ly obstruclS the Centre in any

investigation being carried OUt by rum under the provisions of this Act

shal l be guilty of an offence and liable. on conviction. to a line (mu/la) of

up to twenty thousand Maltese liri.

8. (I) The Central Bank of Malta may request the Centre 10 pass

to it infonnal.ion in the possession of the laner which is necessary for the

di sc lwge by the Central Bank of its duties under the Central Bank of

Malta Act, and the Centre shall comply with such a request.

(2) The Centre may request the Central Bank of Malt a to pass

to it infonnal.ion in the possession of the laner whk:h is necessary for the

discllaige by the Centre of its duties under this or any ocher Act, and the

Central Sank shall comply with such a request.

(3) Information subject. 10 the duty of pro(essionallCCrccy may

be communkaled pufSl.lanllO subarticle. ( I) Ilnd (2) of this article and

ahall also be suhjecllo the duty of profcuionalaccrtCy in thc Iw1ds oC the

rmpienl

Passed by the HOlUe of RIopucntMives III Sittilll No. 303 of the 2(kh

July, 1994.

LAWRENCEGONZl

SpNU,

RlCHARDJ.CAUCHI

Clerk /0 IM HQUSt uf RepnsentatjWlI

.ppubIotikll "'id·Oipani .... ~1 to' "'nformuz;o..; - KMtiljo _ 1'wbIi._ b, ,,,,, o.p.",",~, Df 1~{o""",iDto - Kat#ljo

Milbup n.1"""'porijo ... ·0 .... "' - hMw .. 1Io< G<>vn>ImmI """,;,,. fu ..

(I) The soon title of the principal Act shall be deleted and Amolldmml

substiMed by the words "Malta FlIIII/lCial Services Ccntrr: Act".

01 ""'" lille

..-lotbrtpMS

01 ~ principal A«.

(2) In the ioog tide of the principal Act. for the words "To

establish an Authority for- inlematiooal Fmancial and Trading Activities "

lbae shall be 5Ubstitulcd !he words 'To cswblisb • Centre for Financial

0_.·

•

~.=.

(3) In the Amlngemml of Sections of the principal Act, for the

wonls 1he Malta Imemational Business Authority" there shall be

5ubstiuncd the words "The Malta Financial Services Centre". and after the

reference to the Second Schedule and its contenlS there shall be added the

words 'Third Schedule" and "General functions and powers of tbe Centre"

rapcctivcly.

(4) In $eCtion I of !be principal Act, for the words "Malta

Internatiooal Business Activities Act" there shall be substituted the words

"Malta Financial Services Centre Act",

In subsection (I ) of section 2 oCw principal Act

(a)

the definition of "the Autllority' shall be deleted

in tbe definition of "the Board ", 'capti ve insurance

(b)

offshore company", "the Comminee" and "ofl$hore activity' , !he won!

"Authority" whenever it occurs sllall be deleto:l and substituted by the

word "CenU'C";

(c) immediall:ly after the definition of "captive insurance

offshore company" and before the definition of "tbe Committee" there

sllaU be added the following new definition

" "the Centre" means the Malta Financial Services Centre

established by section 3 of tllis Act:"

(d) immediall:ly after the definition of "the Court" and

before the definition of "foreign currenc::y" there shall be added !he

following new definition

• "Director" means any peBOll appointed as a member of the

Exocutivc Committee, other than the Otic! Executive, pursuant to

5eCtion 8 of this Act:"

(e) the definition of "MiniSter" shall be deleIed and shall be

substituted by the following new definition

• ' the Minister" means the Minister responsible for finance ;";

(0 in the fourth proviso 10 !he definition of "offshore

activity' immediately after the word "Malta" there shall be qdcied the

following

• . or agricultural and horticultural producu and fish produced or

bred in Malta:";

immediately after the proviso to the definition of

(g)

"resident in Malta" there shall be added the following

' Provided further Ihat for the purposes of the definition of

"offshore activity' in this 5eCIion. a company fonned and

registered in Malta which is wholly owned by persons not resident

in Malta and which expressly limits ilS objocts and activities to

the ownership. administration or operation of exempted ships

registered under the Merchant Shipping Act shall be deemed IKII

10 be a resident in Malta;": and

(h) immedimely after tbe definition of "residem in Malta"

tbere 5ha11 be insened the following definition

" "ship" has the meaning assigned to it by the Merchant Shipping

Act.".

The heading or Pan I of the prind pal Aet shall be deleted and

shall be substilUled by the words "The Malta Firnmcial Services Centre".

(I ) Subsection (I) of sedion 3 of the principal Act shall be

xlded and shall be substi tuted by the following subsection

"( 1) There shal l be a cemre to be caUed the Malta Financial

Services Centre.".

(2) In subsection (2) of section 3 of the: principal Act for the

word "Authority" that! shall be substituted the word "Centre" .

In section 4 of the principal Act

(a) the won:! "Authority" wbercvcr it occurs and in the

marginal note shall be dekted and shall be substituted by the word

"Centre"; and

(b) in subsection (I) theieof, paragraphs (a) to (e), botb

inclU$ive, shall be dddm and shall be substituted by the following

new paragraphs;

"(a) to promolc MaJla as acenU'e fl)(" inlemalional financial

services' ,

(b) \0 assist bodies corporale and other persons (0 e<!ablish in

Malta financial services activities ;

(c) to provide overall C(l-()rdina1ion of the financial services

SOCIOI' generally in Mall&;

(d) to monitor and supervise off~ activities 10 ensure mal

they are performed acconliog 10 law and in particular Ihat they

are not carried out in such areas or manner as to serve the

purposes of illicit activities, whether in Malta or abroad. or

otherwise 10 be detrimental to the inlereslS of Malta; and

(c) to advise the Government generally on financial services

and other related matters.".

Im mediately after section 4 of the principal ACI there shall be Addition oIne ..

added the following new section

4A.(I) The Centre shall also have the functions

and powers set out in the Third Schedule to this Aet.

(2) The Board of Governors of the Centre, its

Executive Committee and employees shall not be

tiable in damages for anything done or omitted to be

done in the discharge or purponed discharge of any

fuoction under this Act, unless the act or omission is

shown to have been done or omitted to be done, as the

case may be, in bad faith.".

In section 5 of the principal Act, the word · Authority ", whenever Amer.dmen! cJ

it oocurs and in the marginal nOle, shall be deleted and shall be substituted IlCtiOll S of lbc

by the word "Centre".

Section 6 of the principal Act shall be: amended as follow.:-

(a) subsection (I) thereof shall be deleted and substituted by

the following

"( I) The Board of Governors shall consist ofa C hairman

who shall also be: President of!be Centre, and not more than five

other members as may from time 10 time be appointed of whom

(a) one shall be the Governor of the Central Bank. or, as

his alternate, an()(hcr official of tbe Central Bank empowered

10 represent the Bank, and all the provisions of this Act shaD

apply as though refercllCes to a member of the Board included

a referenceto the alternate referred 10 in this paragraph;

(b) three members selected from among penons who

nave distinguished themselves in buiness, financial

activities. the professions, the public services or academic

affairs: and

(c) onc shall be the Chief E.Iecutive who shall 00( have

the righl 10 vQ(e

Provided that the members of the Board of Governors, other

than t~ Chairman, shall no! be regarded as delegates from any

com~n:iaJ ,

Government authority or from

any

financial.

agricultural, industrial or Olher interest with which they are or may

have been cooneaed, and shall not receive or accepc dim:tions

from any person or authority. except as provided by pamgraph (a)

of this subsection.~; and

(b) subsectiOll5 (5) and (6) thereof shall be renumbered as

subsections (1) and (8) respectively, and for subsection (4) thereof

tllc:re shall be substituted the following

"(4) A person shall not be qualified to be appointed. or to

hold office as a member ortlle: Board ofGovemors if lie: •

(a) is legally irx:apadtated; Of

(b) has been declared bankrupt or has

made

a

composition or ammgement w ith his creditors; or

(c) has committed an offence involving fmud or other

disllonesty; or

(d) has contravened any provision made by or under any

enactment appearing to be designed for protecting members

of the public against fiI\lUlCial loss due to dishonesty,

iDcornpetence or malp".:tioe by person$ cOflCeilled in !he

provision of banking, ill5WllDCe, investmenl or other financial

services or the management of companies or against fmancial

loss due to the conduct of discharged or undischarged

bankrupu; or

(e) has engaged in any business practice appearing to the

Prime Minister to be deceitful or oppressive or otherwise

improper (whether unlawful or not) or which otherwise

reflects discred.it on his method of conducting business or

profession; or

(f) has engaged in Of been associated with any other

business practicet or otherwise oondocted himself in suc l'! a

way as to cast doubt on his competence and soundness of

judgment; or

(g) I'! as a financial or other interest as is likely to affect

pn:judicially the discharge by him of his functions: or

(h) is otherwise not a fit and proper person to hold that

office.

(5) In ddcmtining whether a person is a fit and proper

person, the Prime Minister shall have regard to that person's

probity, to hi s competence and soundness of judgment for fulftl1ing

the responsibilities of that office, to the diligence with whicl'! he is

fulfilling or is likely to fulfil those responsibilities and to whether

the interests of any person are, or are likely to be, in any way

threatened by hi s holding that office,

(6) Any person whom the: Prime Min ister has appointed or

proposes to appoint as a member of !he Board of GovttnOr$ $hall,

whenever requested by the Prime Minister to do so, furnish to him

such information as the Prime Mini ster considen necessary for the

performaoce of his duties under sub-paragraphs (4) and (5)

above.".

10, Section 7 of the principal Act shall be amended as follows: -

for .. t I

lion (2) there shall be ."bslituied the following

(a)

new P ....... ction

"(2) The Boon! ,hall not lid: unlc&t I quorum coruisting Dl

not lcu than three members havina the right 10 vote il present.";

"'"

(b) in ah;-"ion (!5) thett:of, the words "1Dd the Deputy

Cbief Executive" shall be deleted and fOl" the words "the Awhority'

there &hall be lubstituted the words "the Centre",

L-artikolu 7 la' I-An pintipali ghandu j igi emendal kiraej

(I) s-subattikolu (2) tieghu ghandu j illlusar u minlloku

gIIandu jidhol din is-5ubutikolu gdid Jj aej

"(2) ll -Bord m 'g.handWl. jagixxi kemm-i l datba ma jlow

hemm prckn ti quorom la' mhux inqas minn tliet membri li

ghandhom il -jedd tal ·voL"j U

(b) fis-subartiko lu (5) tiegllu, iI·klicm "u d-DepU II I Chief

Executive" gllandbom jithassru u minfl ok il-kliem "la' I-Awlorila' "

gIIandhom jidhlu I-klicm "tat-Cenw".

Section 80hbc principal Act shall be amended Il$ follow.

(a> subsoction (I) thcTeof $haI1 be deleted and substituted by

the foUowing new subsa::tion

"( I) TIle Executive Comminee of the Cenue ,hall consiSl of:-

(a) the Chief Exoculivc: and

(b) a DircclOl" for each of the areas of financial services

lupervilion I$,igned 10 the Centre,"; and

(b) lubsection {l} Lhe~or shall be amended by adding at the

cnd thereof IIle words ", or, where only two membeQ of the

Committee are in offICe, the quorum .hall be two membcl'l" .

In sections 9, 10, ] I and 12 of the principal ACI, for the word

• Authority" wherever it oc<:un, there shall be substituted the word

"Cenlre",

Sub5caion (I) of lOCtion 9 of the principal Act $haU be

substituted by the following new subsection

The members of tne &.ecutive Commiuee shall be

"(I )

appointed by the Board of Governors on wch lemu and

conditions 1$ !hey may detennine. The provisions 0{ subsections

(4) 10 (6) of KCtion 6 lha1l apply 10 the qualirlClUon for

appointmenl. or the holding of of rICe. of Ihe Chief EXeculive or

any Director. as though the n:feren:es in !hose subseclioll$ to the

Prime Minister were references 10 the Board 0{ Governors and

refel'C'noeI in tho5e tube lions 10 the Board of Governors .... ~

references 10 the &.CICUlive Comminte.".

Subfeaion ( I) of section JO shall be amended by adding after the

wonb "ChiefEJ;ecUlive" the foUowing wOfds

., and. as his alternate, sucb other offiCC£ of the Ccn~ as the

Board of Governors may by notice in the Gav:Ut designate.'.

Imm ..... iately afleT section 1I of the principal Ace Ibcre sball be Addllioa ohcoo

added the following DCW section

"ProCcasioDaI

llA. The membcn of the Board of GovernOR, the

..... It,'y.

manbers of the Executive Committee and all

employees of the Centre shall be bound by the duty of

professional. seertt}' in =pc:ct of all infonnalion

which they oblain in !he exercise of their functions .".

Section 12 of the principal Act WIll be amended as follows

(I) in subsection (2) thereof the words "11!ldeT an oaah of""

scc~y taken by the judges coostin.ning that coun before the

investigation is commenced" shall be deleted; and

(ii) subsection (3) thereof shall be ~umbe~ as subsection

(4) and the following shall be inserted immediately before it

"(3) The Registnlr of the courts shall take an oath of :sec,t(!y

before the Court of Appeal in respect of any documenl5 and

infOflTlatiOl1 that may come to lIis knowledge in the course of

implementing the provisions of subsection (2) of this section.".

(I) In section 13 of the principal Act. for the word "Authority' Amendmenlol

whenever it occurs there shall be sumtitutcd the word "Centre",

(2) Paragraph (a) of 5ub$e<:tion (2) of section 13 shall be delelcd

and shall be substituted by the: following new paragraph

"(a) income from registration and other fees payable under

this Act or any ~r Act in respect of which the Centre exercises

registration or similar fU/lCtions.".

In section 14 of the principal Act for tbe: word "Authority" Amelldrnont of

wherever il OCC\Uli there shall be substituted the wonJ"Centre".

In section 15 of the principal Act for the word "Authority" Amelldrnont 01

wherever it occurs there shall be substituted the word "Centre", and in _tiOllI501th.

subs«tion (2) thereof lhe words "given afler consultation with the principal Act

Minister ~ponsible for nnance" and tbe: words. "after consultation as

aforesaid". shall be deleted..

For section 16 of the principal Act there shall be substituted the

following

"Advance" by tbc

16. The Minister may make advances [0 the

O<>Vemment

Ccnm of such sums as be may oonsider to be

required by the Cen~ for carrying out any of its

functions under this Act, and may make such

advances on such tenus and cooditions as he may

deem appropriate. Any such advances may be made

by the Minister out of the Consolidated Fund, and

without funher appropriation other than lhis Act, by

warrant under his hand authorising the Accountant

General to make such adVlI!lCell. ".

In sections 17 \0 19, 21, 22, 24 to 29. 41 to 47, 49, 51 and 52 of

the principal Act, for the word· Authority· w herever it occurs there shall

be substituted the word ·~ntre".

Section 22 of the principal Act shall be amended as follows

(a) in the first proviso to paragraph (c) of subsection (2)

thereof, immediately after the words "the manufacturing or processing

of goods ill Malta" there shall be il1Sened the followillg

"or the cultivation of agricultural or honicultural products or the

fanning of fish in Malta ", and

(b) in paragraphs (c) and (d) of subsection (5) thereof for

tile words "Minister respons ible for finance" there shall be substituted

the word "Mini ster",

(c) subsection (10) thereof sha!l be deleted.

Section 23 of the principal Act shall be amended as follows

(a) in the first proviso to subsecti on (6) thereof for the words

"the ownership. managemeot'· there shall be substituted the words "the

management". and for the words "not belonging to it" there shall be

substituted the words ·whether belonging to il or not";

(b) the second proviso to

subsection (6) thereof shall be

deleted

(c) in the thi rd proviso 10 subsection (6) thereof for the words

"shall for the purposes of this Act be considetW as a general trading

offshore company' there shall be substituted the following

· shall within a period of one week, notify the Centre in writing of

this fact, giving full detai ls of the transaction and of the beneficial

ownership of the offshore company and the Centre may impose in

writing such conditions as it deems necessary for the perfonnance

of its functions under this Act.·.

Section 24 of the principal Act shall be amended as follows

(a)

immrxl;ate1y at the end of subso:tion (1) thereof there

shall be imelted the following

"Such certificate sllall be signed by the Chief fuco;:utive or by

such other officer of the Centre duly delegated from time to time

for this purpose.";

the proviso to subsection (2) thereof shall be deleted and

(b)

the following substituted therefor

"Provided that where under the provisions of this Act the

offshore company is required 10 have a nominee company as its

sole director or secrelllry. the said nominee company shall in the

application certify that the offshore company satisfies all the

conditions of this Act to enable it to be registered as an offshore

company.";

(c) subsection (8) thereof shall be deleted ; and

(d)

subsection (9) thereof shaJJ be renumbered (8).

In the proviso 10 subsection (2) of section 25 of the principal Act Amendment of

for the words "sum equal to" there sb.all be substitutw the words "penalty .<ecli~ 25 of lhe

established by the Centre in its discretion not e~ceedjng".

Section 26 of the principal Act shall be amended as follows

soclion 26 of the

(a) subsection (2) thereof shall be substituted by the principal AcI.

following

"(2) All income. money or other property helonging to o r in

the possession of a company as is referred to in subsection (I ) of

this section, shall be liable to seizure and shall be forfeited in

favour of the Government and bc:come its property absolutely,

unless the company proves that the income, money or other

property was not derived or originated directly or indirectly from

a transaction, operation or other activity referred to in the

procc:ding subsection."

(b) in paragmph (ill) of subsection (3) the~f for the words

"exc"""'ing one month," there shall be substituted the words

"ellceeding one month; or"

(c) irnmaliatcly after paragraph (iii) as amended of subsc:ction

(3) thefllof there shall be inserted the following

"(Iv) in the case of a non-trading offshore company referred to in

the third proviso to subsection (6) of section 2] of this Act, it has

failed to comply with any of the requirements laid down in the

said proviso:; and

(d) in the proviso to subsection (3) thereof, immediately after

the words "as the Centre may specify." there shall be inserted the

words "Nevertheless the Centre may. where in its opinion there exist

reasons of suffICient gravity, proceed to the illlIIU!diate canccUation of

the registration of the company.".

27, Section 27 of the principal ACI shall be amended as follows

(a) in paragraph (a) of subsect ion (3) thereof. for the words

Ma non-trading" there shall be substituted the word "an"; and

(b) paragraph (c) of subsection (3) t/)ereQf including t/)e

proviso thereto shall be deleted and paragraph (d) shall be re-Iettered

(c).

L-artikolu 27 \.I' \-An priueir-Ji r,handu jigJ c" .. ndat kir gcj

(a) il-pangrw.fu (a) t&s-subattikolu (3) ticgbu ghandu jitj

,,, .. odIl billi jilhuJl'\l I ·ldi~ "mhux kultllTl:.tjali " ;

(b) il-pullgI1IfU (t ) IIJ-sublrtilcolu (3) ticg/lu kir ukoll iI-

proviso gh.andhom jitlwsru u l' pang!1IN (d) la' l·islCSI Jubattilwiu

ghandu jsir (t).

(I) In t/)e first proviso to subsection (2) of section 30, substitute

th e words "paragraphs (a) and (b)" with the words "paragraph (a)".

(2) In subsection (9) of section 30 and in t/)e Second Schedule to

the principal Act, for the words "Malta International Business Activities

Act" there shal l be substituted the words "Malta Financial Services Centre

Act".

Tn subsection (6) of section 39 of the principal Act the words "and Amendmoot cl

such continuance shall have effect notwithstanding anything cootained in lection 39 cl the

principal Act.

the law of its fOlIIler jurisdiction" shall be deleted.

Subsection (2) of section 41 nf the principal Act shall be amended Amendment cl

by the insertion of ", unless otherwise authorised by the Centre: "",tioo 41 of the

immediately after the words "in respect thereof'.

In section 44 nf the principal Act for the words "and any change Am.ndmtntof

among the directors and any such change shall nor. have effect unless and section 44 of the

until they are so notified" there shall be substituted the words

principal Act

"and of any change among its directOlll and members. and any

such changes shall not have effect ullless and until they are so

notified to and approved by the Centre.".

Section 46 of the principal Act shall be amended as follows

AmeJldmen: cl

section 46 of (he

(a) in subsection (I) thereof the word "Offshore" shall be principal Act.

",,,,,,,. ,

(b) subsection (2) th=f shall be substituted by the

following

"(2) General trading offshore companies and oon-troding

offshore companies may be regislered with the Centre under this

Act only through the agency of a nominee company authorised to

act as ~uch w ith respect to such companies."; and

(c)

immedialely after subsection (2) thereof there shall be

iMerted!he following new subsection

"(3) A non-trading offshore company shall be represented

legally and judicially by a nominee company either as its sole

director or as its secretary whether alone or with such other

persons as may be provided in the articles of association or. in a

particular case or cases or classes of cases, and with the consent of

the nominee company by such other person or persOIlS as the non-

trading offshore company may appoint for that purpose.".

Immediately after subsection (4) of section 41 of the principal Act Amendmen1 of

there shall be inserted the following new subsection

"(5) Where at any time there is any substantial alleration or

addition in the nature of the activities of a general trading offshore

company it shall be tbe dwy of a nominee company to notify the

~Dtm immediately of the n&lWe of the a1tel1l1ion or addition.·.

Section 49 of the principal Act shall be amended lIS follows

(a) in subsection (2) thereof for the words "Where a nornin=

company is the sole diroctor of a IIOIHtlIding offshore company or its

sccmary, it ", there shall be substituted the foUowing

"A nominee company acting as the sole diroctor of an oITshon

company or its secretary,"; and

(b) in paragrnpll (a) of subsection (2) tIlereof, the words

"wllcthcr disclosed or not," shall be deleted.

inuncdiatcly after section SI of the principal Act there shall be

added tile foUowiDg new section

5 IA.(I) Any

company may apply

in

" RcaUtnI~DIl of

t ;~"",d

writing to the Centre 10 be registered as a

nomlneu.

nominee and the Ccntm slla.l1 grant the licence if the

conditions laid down in subsections (2) and (3) of tllis

section are satisfied.

t2) TIle conditions referred 10 in the pm:eding

subsection are that·

(a) thccompany is a privllle company;

(b) the objects of the company arc expressly

limited to acting as a nominee shareholder and

trustee and to matters anc:ilISf)' Of incidental thereto;

the majority of the directors arc at all

(c)

times MaJtcsc citizens resident in Mal ta;

(d) the diroctors of the company are not less

than three, of wiMlm at least two arc Maltese

citizens ~ide01 in Malta, who, for an unintCfYUpted

period of fi ve years, have been any or the following

(i) a person holding the wanant of advocate

under the Code of Organi$Dlion and Civil

Procedure; or

(u) a peI$OII holding the warrant of a c;enifled

public accOWltanl or a certified public

accountanl and auditor under the AccounlllnCy

Professioo Act; Of

(in) an associate or fdlow of the OIanered

Institute of Bankers or of the Institute 0(

0Ianered SecmariCII and Adminislnltors or of

the Chartered Insurance Institute of the United

Kingdom Of a membtt of such otber institute or

similar body within or outside Malta

reoognised by the Centre for the pwpose5 of

this section: Of

(iv) a person who has served as a public offlCC.'r

in a grade not hl:low tha! of assistant head of

depanment, or in an equivalent position with a

statutory body, or is othetwise recognised by

the Centre as a person comparable to any of

the persons afOlUaid

(e) the company has established systems for

maintaining proper ra:ords of the identil)' and

~idence of its clients, and the Centre is salisfied

thar such systems are adequate for such purpose;

Md

every person who has a dira:t or indira:t

(0

interest in the company or is a member, director or

secretary thereof, is of good chlll'BCter and has not

been convicted of a crime affecting puhlic truSt or

theft or fraud or of knowingly receiving propen y

obtained by theft or fraud.

(3) Where any of the persons referred to in

paragraph (f) of the preceding sobscction is not an

individual , the requirements of the said paragraph (f)

and this subsection (3) shall apply to suc h person as

though the reference to "the company" were a reference

to such person.

(4) A licensed nominee shall notify the Centre

of any change in its memorandum Of ankles of

association and of any change in its directors or

mernhl:rs, and any such changes shall not have effect

unIcs.s and unlil !hey are $0 notifilld to and approved by

the Centre.

(5) The Centre shall supervise the activities

of licmsed nominees and shall requm l licmscd

nominee to provide the Centre from time to time with

such infonnation as the Centre considers necessary for

the p.IIPOSeI of verifying that the \icrnsed nomin£:e

continues to satisfy the conditiO!l5 laid down in

subsection (2) of this section.

(6) Where a licensed nominee fails to satisfy

any of the conditions in Albsections (2) and (3) of this

section or fails to comply with any request for

information made by the Centre in the exercise of ilS

functions under this t.eCtion, the Cen~ may revoke the

licence of such nominee forthwith.

(7) Whece the Centre has groullds 10 doubt

Ihat any statement in writing issued by a licensed

nominee in relation 10 shares held by it as nominee or

UUStce, Of in relalion to the JXnO!I5 beneficially entitled

to soch shares, is incorrect. the Centre shall review the

activities of the licensed nominee with a view to

detemtining whether the licensed nominee should rcdify

any such statement.

(8) Saving any higher punishment which may

be provided urw:Iet any OIller law, where a licensed

nominee fai ls 10 rectify a statement as detenninod by the

Ccntre pursuant 10 the previous subsect ion, every officer

of the licensed nominee who is in default shall be liable

011 conviction 10 a fine (mU/la) of not less tllan one

thousand and not ITIOfe than ten thousand liri or to

im pri sonment for a tefTTl lK)( exceeding tblee years, or to

both such fine arK! imprisonment

No pelSOll shall subscribe for or hold

(9)

shares in his own name for, or in the interest of, or

otherwise on behalf of another, unless suc h person is

licensed by the Centre 10 act as a nominee or IfUSlce in

accordance wilh the provisions or th is section, ()( unless

such person is licensed or authorised 10 act as nominee

or trustee uOOer any other law. Any person who acts in

bceach of this subsa:tion shall be guilty of an offence

A

'"

against thif Act IlIId $hall be liable to !be puniaIunents

established under s, .... !OCtioo (g) of this lCCtion.

(10) The Minister may. on the .tvice of the

Centre, make regulations for the better carryinl oot of

any of the provisions of this seaion. IlIId may, in

panicular, but without prejudice to the generality of the

roregoing, by such regulations

regulate tile ~ and duties or Iicenscd

(a)

1IO!Ilineet;

(b) pr! I jibe such infonnation which ticemed

ncmil'ltN are to submit to the Centre

(c) establish !be fees payable by licenscd

oominca for the ist"e of 11 licence under this

""""" .. •

•

Immediately after section 55 of the principal Aet then: $hall be AddiUcwI 01_

added !be following new sections:-

KClioru 56 10 60

-

\0 &Iso pria<ijS

All ref~nces in any other enactmcnI 10 the

Malta Interna1ionaJ BUlIiness Authorily and to the

Malta International BUlIines.s Activities Act. shail be

construed u refUWCCl to the Malta Financial

ScMccs Centre and to the Malta Financial Sa .. ices

Ce:ntre Act respc:etivcly. All references to the Deputy

Chief Executive (of tbe Authority) shall be construed

lIS a reference to a Director (of the Centre).

, ... .....

51. Arler 31 December 1996 no new regil tration

psa __

•. our

....

of companks shaJl be made lII1der Ihis Act. either 11.1

"'

-.

new companies or 11.1 the continuance of existing

....... itslO

companies and any regiSU1ltion of Cflmparues on or

afler such date shal! not be governed by this Act

Provided that \t.c Minister may appoint 0Iher dates

for the purposes of the application of this section 10

il\SU1'IU'ICe offshore companies and to companies whlch

exprusly limit !heir object to the ll'II\f\a&atliml.,

adminiSlJ1ltion and operation of a ship or ships whether

or not belonging to them.

(I) (a) The following sections of this Act

shall DOt apply in relalion to off~ companies

registered afler a date to be established by the

Minister by ootice in the Gau(te, which dale for

the purpose!! of (hb 9'JCtion and of sections 59 and

60 of this Act is referred to as "the rclevant date "

• section 11 ;

- section 12;

- section 30, subsectiou (9) thereof;

- section 38

Provided Iha! nothing in the foregoing shall

hirder the Centre from ...alng 10 identify the

individuals or other persons having an interest in the

owlICI$hip or control of trading offshore companies,

or of offshore companiea; having an interest in

companies engaged in the manufacturing or

pror p 55ing of goods in Malla. Of in the cultivation

horticultural products or the

of agricuJrural

(J(

farming of fish in Malta.

(b) Offshore companies registered after the

relevant dale shall not benefit from anangemcnts

made punuanllO section 76 (formerly section SO) of

the Income Tax Act.

(2) In relation \0 offshore C«Ilparues registered

afler the relevant date, subsection (8) of section 3() of

thu Act sllallllOl apply and the following provision shall

appl y in subslitutioolhcrefor.

"All promdings before the Board of Special

Commissioners or the Court of Appeal shall be

held in camera 10 !he extent necessary to protcct!he

legitimate business secrets of the company and ;1$

$hareholdcrs." .

(3) In relation to offshore com panies registered

after the relevant date. subsection (3) of section 35 of

tkis Act shallllO( apply and !he following provi sion shall

apply in substitution therefOT

'ibe ptooyo1ings under this section, other than

the order or directive I.Ifthe Court and such parts of

the pioco.dings as the Coon may deem C55C11tial IQ

diac:lose, shall, together with any docwnenl or other

information produced Of givm and any evidaK:e

heard for the purposes Qf such piooccdings, be kepi

secrec and confidential by every penQn concerned

Of C(JDntClCd with the said proceedings 115 weD as

by any other penon IQ whose notice such maner

may come as though they wen: bound by the duty

secn,,.,.

I.If professiorLal

in respect of such

information. The recGrds Gf such proceedings shall

be kept under the persona.l custody of the Registrar

Gf the Coon.",

(4) The following sections of thh Act shall

cease tG apply after the expiry of ten yean from the

relevant dale

· section 21;

• section 28;

• ICCtion 29;

• section 30;

- section 31;

- section 32;

- KCtion 33;

- section 34;

- KCtion 35;

- sectil.ln 40.

(5) NOIwithstanding the provisiGns of section 53

of this Act (guarantee Gf exemptions), the guarantee

shall expire ten yean from the issue of the certificate of

registration Gf an offshore company or ten years from

the rekvant date, whichever is the earlier, and in either

case, the company shall cease to be an offshore

company.

NOIwithstanding the provisions I.If the previous

section. lhe Minister may, by notice in the Gazette, appo,nt

a date. priQr tQ the expiry Qf ten yean from the relevant

date, from wllich section 29 of this Act shall cease tl.l

apply,

( I ) Wbm: an offshore company notifies

!he

Centre in writing 011 or bef'att. the expiry of nine

years from the relevant date that it desimi to c·qe to be

such. company, the Centre may, if it thinks fit,

authorise luch company in writing 10 cease to be an

determined by the

from a date

offshore company

Centre in its ab$olute diSCrdion. Where, w\der the

provisions of this Act, the offshore company ill requimI

\0 have. nomiooe company acting as its sole director or

secretary. !he ~ notiflC8Don shall be made

by the nominee company on behalf of the offshore

company.

(2) The effects of an authorisation given

pul$uant 10 the previous subsection shall be as follows

(a) Ibe offshore company shalJ cease 10 be an

ofI'sbore company as from !he aforesaid date

deccnnincd by the Centre;

(b) the offshore company shall not be di ssolved

by virtue of ceasing 10 be an offshore company; and

(c) the provisions of this Act shall .... sS" to

apply 10 the company IU from !he date the company

ceues to be an offshore company

Provided that the proviSions of section 11,

section 12 and section 38 of this Act shall continue to

apply in ~pc:cl of transactions and activities of the

place prior to the dale when the

company taking

company ceases 10 be an offshore company. ".

31. Immediately after the Second Schedule 10 the principal Act. lhere

.hall be added a new Third Schcdule in the foon set OUI in the Schedule 10