ACT No. XIV of 2024 AN ACT to amend the Virtual Financial Assets Act, Cap. 590, and to provide for other matters ancillary or consequential thereto.

I assent.

(L.S.)

MYRIAM SPITERI

DEBONO

President

16th April, 2024

ACT No. XIV of 2024

AN ACT to amend the Virtual Financial Assets Act, Cap. 590,

and to provide for other matters ancillary or consequential thereto.

BE IT ENACTED by the President, by and with the advice and

consent of the House of Representatives, in this present Parliament

assembled, and by the authority of the same as follows:-

(1) The short title of this Act is the Virtual Financial Short title and

Assets (Amendment) Act, 2024 and this Act shall be read and commencement.

construed as one with the Virtual Financial Assets Act, hereinafter Cap. 590.

referred to as the "principal Act".

(2) Paragraphs (b), (c), (d), (f) and (h) of article 2 shall come

into force on 30 June 2024.

Sub-article (2) of article 2 of the principal Act shall be Amendment of

article 2 of the

amended as follows

principal Act.

(a)

in the definition "administrator" the words "or

a VFA agent" shall be deleted;

(b) immediately

after

the

definition

"advertisement" there shall be added the following new

definition

" "asset-referenced token" shall have the

same meaning as that assigned to it in point (6) of

Article 3(1) of the MiCA Regulation;";

(c) the definition "DLT asset" shall be amended as

follows

(i)

in paragraph (c) thereof the word "or"

shall be deleted; and

(ii)

paragraph (d) thereof shall be

renumbered as paragraph (e) and immediately

before paragraph (e), as renumbered, there shall

be added the following new paragraph (d)

"(d) electronic money token; or";

(d)

immediately after the definition "electronic

money" there shall be added the following new

definition

" "electronic money token" or "e-money

token" shall have the same meaning as that

assigned to it in point (7) of Article 3(1) of the

MiCA Regulation;";

(e)

in the Maltese text, in the definition "entità

emittenti" the words ""entità emittenti" tfisser" shall be

substituted by the words ""entità emittenti" jew

"emittent" jew "emittenti" ifissru";

(f)

immediately after the definition "Member

St a t e " t h e r e s h a l l b e a d d e d t h e f o l l o w i n g ne w

definition

" "MiCA Regulation” means Regulation

(EU) 2023/1114 of the European Parliament and

of the Council of 31 May 2023 on markets in

crypto-assets, and amending Regulations (EU)

No. 1093/2010 and (EU) No. 1095/2010 and

Directives 2013/36/EU and (EU) 2019/1937, as

may be amended from time to time, and includes

any binding legal instruments, guidelines and

other measures that have been or may be issued

thereunder;";

(g) the definition "VFA agent" shall be substituted

by the following new definition

" "VFA agent" means any person who is registered

as such with the competent authority on the first date of

the coming into force of the Virtual Financial Assets

(Amendment) Act, 2024;"; and

2024. (h)

in paragraph (c) of the definition ""virtual

financial asset" or "VFA"" the words "a virtual token;"

shall be substituted by the words "a virtual token:" and

immediately after there shall be added the following

new proviso

"Provided that, for the purposes of Part II,

asset-referenced tokens and e-money tokens shall also

be excluded;".

Article 3 of the principal Act shall be amended as follows

Amendment of

article 3 of the

principal Act.

(a)

the proviso to sub-article (1) thereof shall be

substituted by the following new proviso

"Provided that where a DLT asset is determined by

the issuer to be a financial instrument or electronic money,

the issuer shall be required to comply with the respective

applicable laws in lieu of the provisions of this Act.";

(b)

sub-article (3) thereof shall be deleted; and

(c)

immediately after sub-article (4) thereof there shall

be added the following new sub-article

"(5) Where the applicant is constituted in a

recognised jurisdiction, he shall abide with any local

presence requirements as may be prescribed or provided

for in rules issued under this Act.".

Article 7 of the principal Act shall be substituted by the Amendment of

article 7 of the

following new article

principal Act.

" Obligations of the

The obligations of the issuer shall include

(a)

complying with the provisions of this

Act and with any regulations made and rules

issued thereunder;

(b) co-operating with the competent

authority in an open and honest manner;

(c)

providing prompt feedback to the

competent authority with respect to any enquiries

raised by the said competent authority;

(d) disclosing to the competent authority

in a timely manner any material information of

which it has knowledge which addresses non-

compliance, or potential non-compliance with

any of the provisions of this Act or of any

regulations made or rules issued thereunder;

(e)

receiving

and

retaining

all

documentation and information to demonstrate

how, and to what extent, it has satisfied the

requirements as prescribed in the provisions of

this Act and of any regulations made and rules

issued thereunder, in so far as they apply to any

offer or admission to trading referred to in article

3, including inter alia how the issuer is

considered to be a fit and proper person to carry

out the activity or activities referred to in article

3, and to demonstrate how it has complied and,

as far as it can determine, how it shall comply

with its continuing obligations under this Act;

(f)

submitting to the competent authority

all required information and documentation in

terms of this Act and of any regulations made

and rules issued thereunder, including the

confirmations in terms of article 4(1), in a timely

manner;

(g) disclosing to the competent authority

without delay any information or explanations

that the competent authority may reasonably

require for the purpose of verifying any

information which should be taken into account

when considering an application for the

registration of a whitepaper;

(h) submitting to the competent authority

on an annual basis a certificate of compliance

within the meaning of article 32; and

(i)

complying with any other conditions

as the competent authority may require or as may

be prescribed.".

5. Sub-article (1) of article 8 of the principal Act shall be

amended as follows

(a)

the first proviso thereof shall be deleted; and

(b) in the second proviso thereof, for the words

"Provided further that" there shall be substituted the words

"Provided that".

6. Article 14 of the principal Act shall be amended as Amendment of

article 14 of the

follows

principal Act.

(a)

in sub-article (1) thereof, the words "solely through

a VFA agent which is duly registered in terms of this Act" shall

be deleted; and

(b)

sub-article (3) thereof shall be deleted.

7. Sub-article (1) of article 38 of the principal Act shall be Amendment of

article 38 of the

amended as follows

principal Act.

(a)

in paragraph (b) thereof, for the words "issuers, VFA

agents and licence holders," there shall be substituted the words

"issuers and licence holders,"; and for the words "issuers, VFA

agents, licence holders" there shall be substituted the words

"issuers, licence holders";

(b) in paragraph (j) thereof, the words "VFA agent,"

shall be deleted;

(c)

in paragraph (k) thereof, for the words

"requirements for VFA agents and licence holders;" there shall

be substituted the words "requirements for licence holders;"; for

the words "competent authority on issuers, VFA agents and

licence holders," there shall be substituted the words

"competent authority on issuers and licence holders,"; and for

the words "administrative penalties on issuers, VFA agents,

licence holders" there shall be substituted the words

"administrative penalties on issuers, licence holders";

(d) in paragraph (o) thereof, the words "VFA agents,"

shall be deleted; and

(e)

in paragraph (p) thereof, the words ", VFA agents"

shall be deleted.

Sub-article (1) of article 39 of the principal Act shall be Amendment of

article 39 of the

amended as follows

principal Act.

(a)

in paragraph (b) thereof, for the words "any issuer,

VFA agent, intermediary" there shall be substituted the words

"any issuer, intermediary"; and

(b) in sub-paragraph (i) of paragraph (e) thereof, the

words "or VFA agent" shall be deleted.

In sub-article (1) of article 40 of the principal Act the

words "or VFA agents" shall be deleted.

Sub-article (2) of article 41 of the principal Act shall be

amended as follows

(a)

in paragraph (b) thereof, the words ", VFA agent"

shall be deleted;

(b) in paragraph (c) thereof, for the words "an issuer,

VFA agent, licence holder" there shall be substituted the words

"an issuer, licence holder"; and for the words "of the issuer,

VFA agent, licence holder" there shall be substituted the words

"of the issuer, licence holder"; and

(c)

in the proviso immediately following paragraph (f)

thereof, for the words "affairs of an issuer, VFA agent or licence

holder" there shall be substituted the words "affairs of an issuer

or licence holder"; and for the words "liquidator of the issuer,

VFA agent or licence holder" there shall be substituted the

words "liquidator of the issuer or licence holder".

Article 42 of the principal Act shall be amended as

follows

(a)

in paragraph (a) of sub-article (1) thereof, the words

", VFA agent" shall be deleted;

(b) in paragraph (b) of sub-article (1) thereof, for the

words "assets of the issuer, VFA agent or licence holder," there

shall be substituted the words "assets of the issuer or licence

holder,"; and for the words "of the issuer, VFA agent or licence

holder;" there shall be substituted the words "of the issuer or

licence holder;";

(c)

in paragraph (c) of sub-article (1) thereof, the words

", VFA agent" shall be deleted;

(d) in paragraph (d) of sub-article (1) thereof, the words

", VFA agent" shall be deleted;

(e)

in paragraph (a) of sub-article (2) thereof, the words

", VFA agent" shall be deleted;

(f)

in paragraph (b) of sub-article (2) thereof, for the

words "the issuer, VFA agent or licence holder," there shall be

substituted the words "the issuer or licence holder,"; for the

words "said issuer, VFA agent or licence holder" there shall be

substituted the words "said issuer or licence holder"; and for the

words "such issuer, VFA agent or licence holder" there shall be

substituted the words "such issuer or licence holder";

(g) in paragraph (c) of sub-article (2) thereof, for the

words "the issuer, VFA agent or licence holder," there shall be

substituted the words "the issuer or licence holder,"; for the

words "the said issuer, VFA agent or licence holder," there shall

be substituted the words "the said issuer or licence holder,"; and

for the words "if such issuer, VFA agent or licence holder" there

shall be substituted the words "if such issuer or licence holder";

and

(h) in sub-article (4) thereof, the words ", VFA agent"

shall be deleted.

In article 47 of the principal Act the words ", VFA agents" Amendment of

article 47 of the

shall be deleted.

principal Act.

Article 48 of the principal Act shall be amended as Amendment of

article 48 of the

follows

principal Act.

(a)

in the proviso to sub-article (1) thereof, the words

"and VFA agents" shall be deleted; and

(b) in sub-article (2) thereof, the words "VFA agents,"

shall be deleted.

In sub-article (7) of article 50 of the principal Act the Amendment of

article 50 of the

words "and VFA agents" shall be deleted.

principal Act.

Sub-article (2) of article 54 of the principal Act shall be Amendment of

article 54 of the

deleted.

principal Act.

In article 55 of the principal Act the words "VFA agent," Amendment of

article 55 of the

shall be deleted.

principal Act.

Article 57 of the principal Act shall be amended as Amendment of

article 57 of the

follows

principal Act.

(a)

in paragraph (c) of sub-article (1) thereof, the words

", VFA agent" shall be deleted; and

(b) in sub-article (3) thereof, the words ", VFA agent"

shall be deleted.

Immediately after article 62 of the principal Act, there Addition of new

articles to the

principal Act.

shall be added the following new articles

63. (1) Any issuer who, as from the first date

of coming into force of the Virtual Financial Assets

(Amendment) Act, 2024, shall seek to register a

relating to VFA

whitepaper in accordance with article 3, shall deliver

Act No. XIV of

2024. to the competent authority an application for the

registration of a whitepaper, and the appointment and

services of a VFA agent shall no longer be required.

(2) Without prejudice to article 64(2), any

person who, as from the first date of coming into

Act No. XIV of force of the Virtual Financial Assets (Amendment)

Act, 2024 shall seek to apply for a licence to provide

2024. a VFA service in or from within Malta in accordance

with article 14(1), shall submit an application to the

competent authority, and such person shall no longer

be required to make the application through a VFA

agent.

(3) Notwithstanding the provisions of sub-

articles (1) and (2), where a VFA agent has submitted

an application to the competent authority for the

registration of a whitepaper or for the issuance of a

licence prior to the first date of coming into force of

Act No. XIV of

the Virtual Financial Assets (Amendment) Act, 2024

2024. and such application has, by such date, not yet been

determined by the competent authority in terms of

articles 3(4) and 15(1), the VFA agent appointed to

provide its s ervices in relation to any such

application shall be permitted to continue to offer its

services with respect to that application until the

competent authority issues a decision in relation

thereto

Provided that the VFA agent shall, in any

case, cease to offer its services in relation to such

application within three (3) months from the first

Act No. XIV of date of coming into force of the Virtual Financial

2024. Assets (Amendment) Act, 2024 or until the

competent authority issues a decision in relation to

the said application, whichever is the earlier.

(4) Without prejudice to the provisions of sub-

article (3), VFA agents shall cease to carry on the

activities for which they are registered with the

competent authority upon the first date of coming

Act No. XIV of

i n t o f o r c e o f t h e Vi r t u a l F i n a n c i a l A s s e t s

2024. (Amendment) Act, 2024 and shall, within three (3)

months from the said date, submit to the competent

authority the VFA Agent Deregistration Form

provided for in the rules issued under this Act.

64. (1) When a person has submitted, through

a VFA agent, an application as referred to in article

applications for 14 prior to the first date of coming into force of the

Virtual Financial Assets (Amendment) Act, 2024 and

Act No. XIV of

the competent authority has not yet determined, in

2024. terms of article 15, whether to grant or refuse the

licence being applied for by such date, the said

person shall notify the competent authority, in

writing, whether they shall proceed with that

application or whether they shall withdraw the said

application

Provided that, when such person does not

notify the competent authority in accordance with

this sub-article within one (1) month from the first

Act No. XIV of date of coming into force of the Virtual Financial

2024. Assets (Amendment) Act, 2024, the competent

authority shall deem the application submitted by

that person to have been withdrawn.

(2) Notwithstanding the provisions of this Act,

and any regulations made, and rules issued

thereunder, applications as referred to in article 14

may not be submitted to, and in any case shall not be

accepted by, the competent authority as from 1st

August 2024.".

The First Schedule to the principal Act shall be amended Amendment of

the First

Schedule to the

principal Act.

(a)

in sub-paragraph (f) of paragraph 7 thereof, the

words "VFA agent," shall be deleted; and

(b) in sub-paragraph (2) of paragraph 14 thereof, the

words "or the VFA agent, as the case may be," shall be deleted.

Passed by the House of Representatives at Sitting No. 229 of the

10th April, 2024.

ANĠLU FARRUGIA

Speaker

ELEANOR SCERRI

Clerk of the House of Representatives

€1.08