INSURANCE DISTRIBUTION ACT

INSURANCE DISTRIBUTION

CHAPTER 487

INSURANCE DISTRIBUTION ACT

Substituted by

XXVI.2018.3

To regulate the registration and enrolment of insurance and reinsurance intermediaries and the

insurance and reinsurance distribution activities.

1st September, 2006

ACT XII of 2006, as amended by Act XX of 2007; Legal Notice 427 of 2007; Acts XVII of

2009 and X of 2011; Legal Notice 451 of 2013; and Acts XXXIII of 2015, XXVI of 2018, V of

2020 and Act XLVI of 2021.

The short title of this Act is the Insurance Distribution Act.

Amended by

XX. 2007.154;

(Article 2)

L.N. 451 of 2013;

XXXIII.2015.10;

XXVI.2018.58.

INSURANCE AND REINSURANCE DISTRIBUTION ACTIVITIES

For the purposes of paragraph 1 of the Third Column of this Schedule, "risk"

means and includes a risk situated in Malta or a risk situated outside Malta; and "risk

situated outside Malta", in relation to a contract of insurance, has the same meaning

as is assigned to it by sub-article (1) of article 2 of the Insurance Business Act.

First Column

Second

Third Column

Column

Independent

Dependent

Insurance Distribution Activities and Reinsurance

Insurance

Insurance

Distribution Activities

Intermediaries Intermediaries

Insurance

1. Professional activities of persons listed in the

Broker

First Column of this Schedule who, acting with

complete freedom as to their choice of lawful

i n s u r e r s , b r i n g t o g e t h e r, w i t h a v i e w t o t h e

insurance or reinsurance of risks or commitments,

persons seeking insurance or reinsurance and

insurers or reinsurers, carry out work preparatory to

the conclusion of contracts of insurance or

reinsurance and, where appropriate, assist in the

administration and performance of such contracts,

in particular in the event of a claim;

Insurance

2. Professional activities of persons listed in the

Agent

Second Column of this Schedule who are appointed

by an undertaking authorised under the Insurance

Business Act and, or by a European insurance

undertaking to be its agent in respect of business of

insurance with authority to enter into contracts of

insurance on behalf of the undertaking under the

terms of the appointment;

Insurance

3. Professional activities of persons listed in the

Manager

Second Column of this Schedule which consist of

accepting an appointment from

(a) an insurer or reinsurer to manage

any part of its business, or to exercise

managerial functions therein, or to be

responsible for maintaining accounts or

other records of such insurer or reinsurer

and in this context, “management” includes

authority to enter into contracts of

insurance on behalf of the insurer or

reinsurer under the terms of the

appointment;

INSURANCE DISTRIBUTION

First Column

Second

Third Column

Column

Independent

Dependent

Insurance Distribution Activities and Reinsurance

Insurance

Insurance

Distribution Activities

Intermediaries Intermediaries

(b) an insurance broker enrolled under

this Act, restricted to contracts of insurance

relating to risks situated outside of Malta or

commitments where Malta is not the

country of commitment, to manage any part

of its business, or to exercise managerial

functions therein, or to be responsible for

maintaining accounts or other records for

the broker; and

(c) a reinsurance special purpose

vehicle authorised in accordance with any

regulations that may be made under the

Insurance Business Act (Cap. 403), to

manage any part of its business, or to

exercise managerial functions in relation

thereto.

Tied Insurance 4.

Activities of persons listed in the Second

Intermediary

Column of this Schedule who, for remuneration, carry

out insurance distribution activities for or on behalf of

one or more authorised undertakings in the case of

insurance products which are not in competition,

acting under the full responsibility of those

authorised undertakings for the products which

concern them respectively and who may collect

premiums or amounts intended for the policyholder,

provided that no insurance commitments towards or

on the part of the public are given as part of these

activities.

Ancillary

5. Activities of persons listed in the Second

Insurance

Column of this Schedule who, for remuneration,

Intermediary

take up or pursue insurance distribution activities

on an ancillary basis, acting under the full

responsibility of an authorised undertaking for the

product which concerns such undertaking, or of an

enrolled insurance broker, provided that all the

following conditions are met

(a) the principal professional activity of the

natural or legal person is other than insurance

distribution activities;

(b) the natural or legal person only carries out

insurance distribution activities in relation to

certain insurance products that are complementary

to a good or service; and

INSURANCE DISTRIBUTION

First Column

Second

Third Column

Column

Independent

Dependent

Insurance Distribution Activities and Reinsurance

Insurance

Insurance

Distribution Activities

Intermediaries Intermediaries

(c) the insurance products concerned do not

cover long-term business of insurance or liability

risks, unless that cover complements the good or

service which the natural or legal person provides

as its principal professional activity

Provided that, no insurance commitments

towards or on the part of the public are given as part

of these activities.

(1)

In this Act, unless the context otherwise requires -

"advertisement", in relation to insurance distribution activities,

means any form or medium of marketing activity or communication

disseminated to the public by means of all types of media, other than a

prospectus, which promotes the purchase or procurement of a service

or product and which is addressed by a person registered or enrolled

under this Act, carrying out insurance distribution activities, to a client

or potential client;

"Agents List" means the list of persons acting as insurance

agents established and maintained under article 9;

"Agents Register" means the insurance agents register

established and maintained under article 7;

"ancillary insurance intermediaries activities", in relation to a

person registered and enrolled as an ancillary insurance

intermediary, means the insurance distribution activities listed in

paragraph (5) of the Third Column of the Schedule;

"Ancillary Insurance Intermediaries Company Register" in

relation to an authorised undertaking and an enrolled insurance

broker means the Ancillary Insurance Intermediaries Company

Register established and maintained by an authorised undertaking

or an enrolled insurance broker under article 43B(1);

"Ancillary Insurance Intermediaries List" means the list of

ancillary insurance intermediaries established and maintained

under article 43D(1);

"ancillary insurance intermediary" means any natural or legal

person, other than a credit institution or an investment firm, as defined

by points (1) and (2) of Article 4(1) of Regulation (EU) No. 575/2013

of the European Parliament and of the Council of 26 June 2013 on

prudential requirements for credit institutions and investment firms

and amending Regulation (EU) No. 648/2012, carrying out the

insurance distribution activities listed in paragraph (5) of the Third

Column of the Schedule;

"approved auditor" and "auditor" have the meaning assigned to

them by article 28(10);

"authorised insurance undertaking" has the same meaning as is

assigned to it by article 2(1) of the Insurance Business Act;

"authorised reinsurance undertaking" has the same meaning as is

assigned to it by article 2(1) of the Insurance Business Act;

"authorised undertaking" means an authorised insurance

undertaking or an authorised reinsurance undertaking which has

received authorisation pursuant to article 7 of the Insurance

Business Act or any person deemed authorised under the said Act,

to carry on business of insurance and includes a company enrolled

under this Act to act as an insurance agent of the undertaking, as

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well as a European insurance undertaking or a European

reinsurance undertaking having its head office in a Member State or

an EEA State establishing a branch or providing services in Malta

in exercise of a European right;

"binding authority agreement" means an agreement between a

m e m b e r o f L l o y d ’s o r a p e r s o n a c t i n g o n i t s b e h a l f a n d a

coverholder under which the coverholder may, in accordance with

the terms thereof, accept risks or commitments on behalf of that

member of Lloyd’s;

"body corporate" means an entity having a legal personality

distinct from that of its members and also includes a foreign

corporation;

"branch" means premises of the company, other than its head

office, from which insurance distribution activities or reinsurance

distribution activities are carried out;

"Brokers List" means the list of persons carrying on business as

insurance brokers established and maintained under article 9;

"Brokers Register" means the insurance brokers register

established and maintained under article 7;

"business of insurance" has the same meaning as is assigned to it

by article 2(1) of the Insurance Business Act;

"business of insurance broking", in relation to a registered

insurance broker or an enrolled insurance broker, means the

activities listed in paragraph (1) of the Third Column of the

"cell" has the same meaning as is assigned to it by the

Companies Act;

"cell company" has the same meaning as is assigned to it by the

Companies Act;

"certificate of enrolment" -

(a) in relation to a person acting as an insurance agent,

means a certificate issued by the competent authority

under article 14 to the person evidencing enrolment of

that person in the Agents List; and

(b) in relation to a person acting as an insurance manager,

means a certificate issued by the competent authority

under article 14 of this Act to the person evidencing

enrolment of that person in the Managers List;

(c) in relation to a person carrying on business as

insurance broker, means a certificate issued by the

competent authority under article 14 to the person

evidencing enrolment of that person in the Brokers List;

(d) in relation to a person registered as a tied insurance

intermediary in the Tied Insurance Intermediaries

Company Register of any authorised undertaking, means

a certificate issued by the competent authority under

article 37 to the authorised undertaking enrolling that

person evidencing enrolment of that person in the Tied

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Insurance Intermediaries List; and;

(e) in relation to a person registered as an ancillary insurance

intermediary in the Ancillary Insurance Intermediaries

Company Register of any authorised undertaking or any

enrolled insurance broker, means a certificate issued by

the competent authority under article 43E to the

authorised undertaking or the insurance broker enrolling

that person evidencing enrolment of that person in the

Ancillary Insurance Intermediaries List;

"certificate of registration" -

(a) in relation to an individual registered as an insurance

agent, means a certificate issued by the competent

authority under article 14 of this Act to that individual

evidencing registration of that individual in the Agents

Register;

(b) in relation to an individual registered as an insurance

manager, means a certificate issued by the competent

authority under article 14 to that individual evidencing

registration of that individual in the Managers

Register; and

(c) in relation to an individual registered as an insurance

broker, means a certificate issued by the competent

authority under article 14 to that individual evidencing

registration of that individual in the Brokers Register;

(a) in relation to long term business, means any of the

classes specified in the Second Schedule to the

Insurance Business Act; and

(b) in relation to general business, means any of the

classes specified in Part I of the Third Schedule to the

Insurance Business Act;

"close links" means a situation in which two or more natural or

legal persons are linked by control or participation, or a situation in

which two or more natural or legal persons are permanently linked

to one and the same person by a control relationship;

"commitment" and "country of the commitment" have the same

meanings as are assigned to them by article 2(1) of the Insurance

Business Act;

"company" includes a local company and a foreign company;

"competent authority" means the Malta Financial Services

Authority established by the Malta Financial Services Authority Act;

"conditions" includes obligations and restrictions;

"Conduct of Business Rules" means rules relating to conduct of

business issued by the competent authority under various articles of

this Act and under any regulations made thereunder;

"contract of insurance" and "contract" have the same meanings

as are assigned to them by article 2(1) of the Insurance Business

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"control" means the relationship between a parent undertaking

and a subsidiary undertaking, as set out in Article 22 of Directive

2013/34/EU of the European Parliament and of the Council of 26

June 2013 on the annual financial statements, consolidated

financial statements and related reports of certain types of

undertakings, amending Directive 2006/43/EC of the European

Parliament and of the Council and repealing Council Directives 78/

660/EEC and 83/349/EEC, or a similar relationship between any

natural or legal person and an undertaking;

"controller", in relation to a body corporate, is a person who,

alone or together with others, exercises the power to determine the

financial and operating policies of the body corporate;

"coverholder" means a person authorised under a binding

authority agreement to accept or to issue documents related to

contracts of insurance evidencing the acceptance of risks or

commitments on behalf of a member of Lloyd’s granting such

authority pursuant to such agreement;

"director", in relation to a company, includes an individual

occupying the position of a director of the company, by whatever

name he may be called, empowered to carry out substantially the

same functions in relation to the direction of the company as those

carried out by a director and, in respect of a foreign company,

includes a member of a local board, an agent and the person

designated as the representative of that company for the purpose of

article 12(1)(b)(ii);

"EEA State" means a State which is a contracting party to the

agreement on the European Economic Area signed at Oporto on 2

May, 1992 as amended by the Protocol signed at Brussels on the

17th March, 1993 and as amended from time to time;

"EIOPA" means the European Insurance and Occupational Pensions

Authority established in terms of Article 1 of Regulation (EU) No.

1094/2010;

"enrolled" -

(a) in relation to a person acting as an insurance agent,

means enrolled in the Agents List under article 13;

(b) in relation to a person acting as an insurance manager,

means enrolled in the Managers List under article 13;

(c) in relation to a person carrying on business as

insurance broker, means enrolled in the Brokers List

under article 13;

(d) in relation to a person registered as a tied insurance

intermediary, means enrolled in the Tied Insurance

Intermediaries List under article 37; and

(e) in relation to a person registered as an ancillary insurance

intermediary, means enrolled in the Ancillary Insurance

Intermediaries List under article 43E,

and, in each case, "enrolment" shall be construed

accordingly;

"European insurance undertaking" means an undertaking having

INSURANCE DISTRIBUTION

its head office in a Member State or an EEA State, other than

Malta, pursuing the activity of direct insurance within the meaning

of Article 2 of the Solvency II Directive, which has received

authorisation in accordance with Article 14 of the Solvency II

Directive;

"European reinsurance undertaking" means an undertaking

having its head office in a Member State or an EEA State, other

than Malta, pursuing business restricted to reinsurance within the

meaning of Article 2 of the Solvency II Directive which has

received authorisation in accordance with Article 14 of the

Solvency II Directive;

"financial year" shall be construed in accordance with article

27(4);

"foreign company" means a company or a partnership en

commandite or similar or equivalent body corporate, the capital of

which is divided into shares, registered, incorporated or constituted

outside Malta under the laws of any country provided that such

company or partnership en commandite has complied with the

provisions of any law which may from time to time be in force in

Malta relating thereto;

Provided that, unless otherwise specified, the term "foreign

company" shall not include a European insurance intermediary

registered under article 3 of the Insurance Distribution Directive;

"functions" includes responsibilities, powers and duties;

"group" and "group of classes", in relation to general business,

means any group of classes or part classes specified in Part II of the

Third Schedule to the Insurance Business Act;

"insurance agent" means a person carrying out activities listed in

paragraph (2) of the Third Column of the Schedule; and in relation

to Lloyd’s, means a person enrolled as such under article 13

appointed by or on behalf of a member of Lloyd’s to be its

coverholder in Malta in respect of business of insurance with

authority to enter into contracts of insurance on behalf of that

member under the terms of a binding authority agreement;

"insurance-based investment product" means an insurance

product which offers a maturity or surrender value and where that

maturity or surrender value is wholly or partially exposed, directly

or indirectly, to market fluctuations, and does not include

(a) insurance products falling within the classes of general

business specified in Part I of the Third Schedule to

the Insurance Business Act;

(b) insurance contracts falling within the classes of long-

term business specified in the Second Schedule to the

Insurance Business Act, where the benefits under the

contract are payable only on death or in respect of

incapacity due to injury, sickness or disability;

(c) pension products which are recognised as having the

primary purpose of providing the investor with an

income on retirement, and which entitle the investor to

certain benefits;

INSURANCE DISTRIBUTION

(d) officially recognised occupational pension schemes

falling under the scope of Directive 2003/41/EC of the

European Parliament and of the Council of 3 June

2003 on the activities and supervision of institutions

for occupational retirement provision, as amended from

time to time, or of the Solvency II Directive;

(e) individual pension products for which a financial

contribution from the employer is required by law and

where the employer or the employee has no choice as

to the pension product or provider;

"insurance broker" means a person carrying on business of

insurance broking;

"insurance distribution activities" means the activities of advising

on, proposing, or carrying out other work preparatory to the

conclusion of contracts of insurance, of concluding such contracts, or

of assisting in the administration and performance of such contracts, in

particular in the event of a claim, including the provision of

information concerning one or more contracts of insurance in

accordance with criteria selected by the clients, through a website or

other media and the compilation of an insurance product ranking list,

including price and product comparison, or a discount on the price of a

contract of insurance, when the client is able to directly or indirectly

conclude a contract of insurance using a website or other media, and

includes the activities listed in paragraphs (1) to (5) of the Third

Column of the Schedule, the distribution activities carried out by an

authorised insurance undertaking and any other activities as may be

prescribed;

"Insurance Distribution Directive" means Directive (EU) 2016/97 of

the European Parliament and of the Council of 20 January 2016 on

insurance distribution (recast), as amended from time to time, and

includes any delegated acts and any technical standards that have been

or may be issued thereunder;

"Insurance Distribution Rules" means rules in respect of insurance

distribution activities and reinsurance distribution activities, issued by

the competent authority under various articles of this Act and under

any regulations issued thereunder;

"insurance intermediary" means any natural or legal person, other

than an authorised insurance undertaking or an authorised reinsurance

undertaking or their employees, and other than an ancillary insurance

intermediary, who, for remuneration, takes up or pursues insurance

distribution activities;

"insurance manager" means a person carrying out activities listed

in paragraph (3) of the Third Column of the Schedule;

"insurer" has the same meaning as assigned to it by article 2(1)

of the Insurance Business Act;

"local company" means a limited liability company formed and

registered under the Companies Act and includes, subject to sub-

article (2), a partnership en commandite, the capital of which is

divided into shares, formed and registered under the said Act;

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"Malta’s international commitments" has the same meaning as

assigned to it by article 2(1) of the Insurance Business Act;

"Managers List" means the list of persons acting as insurance

managers established and maintained under article 9;

"Managers Register" means the insurance managers register

established and maintained under article 7;

"Member State" means a Member State of the European

Communities;

"Minister" means the Minister responsible for the regulation of

Financial Services;

"money laundering" has the same meaning as is assigned to it by

the Prevention of Money Laundering Act;

"officer", in relation to a company, includes a director, partner,

manager or company secretary or any person effectively acting in

such capacity whether formally appointed or not;

"own funds" shall be construed in accordance with Insurance

Distribution Rules made for the purpose of this Act to determine

the amounts and components which make up the enrolled person’s

own funds;

"participation" means the ownership, direct or by way of control,

of 20% or more of the voting rights or capital of an undertaking;

"prescribed" means prescribed by regulations under this Act;

"qualifying shareholding" means a direct or indirect holding in a

company which represents ten per centum or more of the share

capital issued by such company or of the voting rights attaching to

such share capital or which makes it possible to exercise a

significant influence over the management of the company, and

"qualifying shareholder" shall be construed accordingly;

"registered" -

(a) in relation to a person registered as an insurance agent

under article 13, means registered in the Agents

Register;

(b) in relation to a person registered as an insurance

manager under article 13, means registered in the

Managers Register;

(c) in relation to a person registered as an insurance

broker under article 13, means registered in the

Brokers Register;

(d) in relation to a person registered as a tied insurance

intermediary under article 37, means registered in the

Tied Insurance Intermediaries Company Register of

any one or more authorised undertakings; and

(e) in relation to a person registered as an ancillary insurance

intermediary under article 43E, means registered in the

Ancillary Insurance Intermediaries Company Register of

any one or more authorised undertakings or one enrolled

insurance broker,

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and, in each case, "registration" shall be construed accordingly;

"regulated market" means either of the following

(a) in the case of a market situated in Malta, a market

authorised in terms of the Financial Markets Act ;

(b) in the case of a market situated in a Member State or an

EEA State, other than Malta, a regulated market as

defined in point (21) of Article 4(1) of Directive 2014/65/

EU of the European Parliament and of the Council of 15

May 2014 on markets in financial instruments and

amending Directive 2002/92/EC and Directive 2011/61/

EU (recast), as amended from time to time; or

(c) in the case of a market situated in a non-Member State

or non-EEA State, a financial market which fulfils the

following conditions

(i) it is recognised by the competent authority and

fulfils requirements comparable to those laid

down in Directive 2014/65/EU; and

(ii) the financial instruments dealt in on that market

are of a quality comparable to that of the

instruments dealt in on the regulated market or

markets in Malta;

"Regulation (EU) No. 1094/2010" refers to Regulation (EU) No.

1094/2010 of the European Parliament and of the Council of 24

November 2010 establishing a European Supervisory Authority

(European Insurance and Occupational Pensions Authority),

amending Decision No. 716/2009/EC and repealing Commission

Decision 2009/79/EC;

"reinsurance distribution activities" means the activities of

advising on, proposing, or carrying out other work preparatory to

the conclusion of contracts of reinsurance, of concluding such

contracts, or of assisting in the administration and performance of

such contracts, in particular in the event of a claim, including the

activities carried out by an authorised reinsurance undertaking

without the intervention of a reinsurance intermediary, the

activities listed in paragraphs (1) to (3) of the Third Column of the

Schedule, and any other activities as may be prescribed;

"reinsurance intermediary" means any natural or legal person,

other than an authorised reinsurance undertaking or its employees,

who, for remuneration takes up or pursues reinsurance distribution

activities;

"remuneration" means any commission, fee, charge or other

payment, including an economic benefit of any kind or any other

financial or non-financial advantage or incentive offered or given

in respect of insurance distribution activities;"; and

"representative" shall be construed in accordance with article 12

of the Insurance Business Act;

"risk situated in Malta" has the same meaning as is assigned to it

by article 2(1) of the Insurance Business Act;

"Schedule" means the Schedule to this Act;

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" Solvency II Directive" means Directive 2009/138/EC of the

European Parliament and of the Council of 25 November 2009 on

the taking-up and pursuit of the business of Insurance and

Reinsurance (Solvency II) (recast), as amended from time to time,

and includes any delegated acts and any technical standards that

have been or may be issued thereunder;

"third country insurance undertaking" means an undertaking,

other than a European insurance undertaking, which would require

authorisation as an authorised insurance undertaking pursuant to

article 7 of the Insurance Business Act, as if its head office were

situated in Malta;

"third country reinsurance undertaking" means an undertaking,

other than a European reinsurance undertaking, which would

require authorisation as an authorised reinsurance undertaking in

accordance with article 7 of the Insurance Business Act, as if its

head office were situated in Malta;

"tied insurance intermediaries activities", in relation to a person

registered and enrolled as a tied insurance intermediary, means the

insurance distribution activities listed in paragraph (4) of the Third

Column of the Schedule, including any person who carries on such

activities in addition to his main activity;

"Tied Insurance Intermediaries Company Register" in relation to

an authorised undertaking means the Tied Insurance Intermediaries

Company Register established and maintained by an authorised

undertaking under article 34(1);

"Tied Insurance Intermediaries List" means the list of tied

insurance intermediaries established and maintained under article

36(1);

"tied insurance intermediary" means a person carrying on tied

insurance intermediaries activities;

"Tribunal" means the Financial Services Tribunal referred to in

article 21 of the Malta Financial Services Authority Act.

(2) The objective of this Act is, in part, to transpose and

implement the provisions of the Insurance Distribution Directive and

any other European Union Directives and Regulations that may be

issued and amended from time to time relating to insurance

distribution activities and reinsurance distribution activities, and

consequently this Act and any regulations, Insurance Distribution

Rules and Conduct of Business Rules issued thereunder, shall be

interpreted and applied accordingly.

(3) The provisions of this Act shall apply to a partnership en

commandite or to a similar or equivalent body corporate subject to

such modifications as the competent authority may, from time to

time, make in any provision thereof, which modifications shall not

materially detract from the main object of the provisions so

modified.

(4) In this Act and in any regulations made thereunder, if there

is any conflict between the English and the Maltese texts, the

English text shall prevail.

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PART II

REGULATORY POWERS

(1) The competent authority shall carry out its functions

under this Act and, in particular, shall ensure compliance with the

provisions of this Act.

(2) The Minister may, after consultation with the competent

authority, make regulations as may be required for carrying into

effect any of the provisions of this Act and without prejudice to the

generality of the foregoing, the Minister may, by such regulations,

in particular, make provisions in respect of any one or more of the

following matters

(a) the implementation of the Insurance Distribution

Directive;

(b) the transposition of any requirement or provision as may

arise under a Directive, Regulation or Decision of the

European Union or any other similar measure relevant for

the purposes of this Act. Any such regulations made

under this paragraph and strictly related to transposition

as aforesaid, may provide that in so far as any of the

provisions of the regulations are inconsistent with the

provisions of this Act or of any other law, the provisions

of the regulations shall prevail, and the provisions of this

Act or of any other law shall, to the extent of the

inconsistency, not apply;

(c) the amendment or revocation of the Schedule;

(d) the payment by any person, body or cell created by a

cell company, as the case may be, of any fees, duties

and such other charges payable to the competent

authority in respect of any matter provided for, by or

under the Act, or any regulations made under this

article;

(e) the registration or enrolment of persons, other than

persons registered or enrolled by virtue of this Act,

carrying out insurance distribution activities or

reinsurance distribution activities or providing services

ancillary to business of insurance as may be

prescribed;

(f) any matter relating to or connected with any provision

contained in the Schedule;

(g) any matter that may or is to be prescribed under any

provision of this Act;

(h) the administrative measures and administrative penalties

in respect of infringements as may be prescribed, which

may be imposed and recovered by the competent

authority without recourse to a court hearing, and such

administrative penalties shall be due to the competent

authority as a civil debt;

(i) the penalties or other punishments to which persons

contravening or failing to comply with any provision

of any regulation made under this Act shall become

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liable, being penalties of not less than two hundred and

thirty euro (€230) and not exceeding one hundred and

fifty thousand euro (€150,000), in respect of any offence

and in respect of a continuing offence of a further penalty

not exceeding two hundred and thirty euro (€230) for

each day during which the offence continues;

(j) any matter incidental to or connected with any of the

above;

(k) any matter relating to the establishment, co-ordination,

amalgamation and otherwise of compensation

schemes.

(2A) The regulations made under paragraph (h) of sub-article (2)

may impose

(a) administrative penalties which may not be greater than

a financial penalty of one hundred and fifty thousand

euro (€150,000) for each infringement or failure to

comply, as the case may be, and, where such

infringement or failure to comply continues, a further

penalty not exceeding one hundred and sixteen euro

(€116) for each day during which the infringement or

failure to comply continues;and

(b) administrative penalties and fines higher than one

hundred and fifty thousand euro (€150,000), where

deemed necessary or appropriate, for any

contravention of or failure of compliance with the

Insurance Distribution Directive or any EU Regulation

issued thereunder, or with any regulations, Insurance

Distribution Rules or Conduct of Business Rules

issued under this Act to transpose or to give effect to

such Directive or Regulation.

(3) The Minister may, after consulting the competent authority,

make regulations exempting any person from all or any of the

provisions of this Act or any regulations made thereunder, subject

to such conditions or requirements including the requirement of

other forms of registration or enrolment and notification procedures

as may be prescribed.

(4) The Minister may also by regulations under this article,

after consultation with the competent authority, extend and make

applicable any of the provisions of this Act to any other insurance or

reinsurance distribution activity as may be prescribed which in his

opinion ought, in the public interest, to be regulated by such

provisions.

(5) Regulations made under this article may make such

exemptions, conditions or modifications as may be specified

therein in respect of different cases, circumstances or purposes and

may give the competent authority such power of adaptation of the

regulations as may be specified therein.

(6) In the event of a doubt as to whether an activity constitutes

the carrying out of insurance distribution activities or reinsurance

distribution activities, or whether such insurance distribution activities

INSURANCE DISTRIBUTION

or reinsurance distribution activities are or are not being carried out in

or from Malta, the matter shall be conclusively determined by the

competent authority.

(7) The exercise of any of the powers assigned under this

article shall be subject to any obligations or restrictions arising

from Malta’s international commitments.

(8) Regulations made under this Act and any amendment or

revocation of such regulations, may be published in the English

language only.

(1) It shall be the duty of the competent authority to carry

out the functions assigned to it by or under this Act and to ensure

that

(a) persons, companies, insurance intermediaries or

reinsurance intermediaries, registered or enrolled in

accordance with this Act and regulations made

thereunder, comply with the provisions of this Act and

of any regulations made thereunder, with Insurance

Distribution Rules and Conduct of Business Rules

made and directives issued by the competent authority

in virtue of this Act and of any regulations made

thereunder, and with the conditions specified in

certificates of registration or enrolment; and

(b) authorised insurance undertakings and authorised

reinsurance undertakings carrying out insurance

distribution activities and reinsurance distribution

activities comply with the provisions of this Act and of

any regulations made thereunder, with any Insurance

Distribution Rules and Conduct of Business Rules made

and directives issued by the competent authority in virtue

of this Act and of any regulations made thereunder.

(1A) The competent authority shall also carry out the functions

and duties as competent authority for the purposes of the Insurance

Distribution Directive, and the European Commission shall be

informed accordingly.

(1B) The competent authority shall have all the investigatory

powers that are necessary for the exercise of its functions.

(2) The competent authority may make Insurance Distribution

Rules and Conduct of Business Rules as may be required for carrying

into effect any of the provisions of this Act and of any regulations

made thereunder. The competent authority may amend or revoke

such Insurance Distribution Rules or Conduct of Business Rules and

any amendment or revocation thereof shall be officially

communicated to the persons concerned.

(3) Insurance Distribution Rules shall be binding on persons

registered or enrolled under this Act, on authorised insurance

undertakings and authorised reinsurance undertakings and others as may

be specified therein. Conduct of Business Rules shall be binding on

persons registered or enrolled under this Act, on authorised insurance

undertakings and others as may be specified therein.

INSURANCE DISTRIBUTION

(4) Insurance Distribution Rules and Conduct of Business Rules

made by the competent authority in virtue of this Act may provide

for different regulatory requirements to be applicable to different

categories of insurance intermediaries and reinsurance intermediaries;

and without prejudice to Insurance Distribution Rules and Conduct of

Business Rules required to be made under this Act and to the

generality of the foregoing, the competent authority may, by such

Insurance Distribution Rules and Conduct of Business Rules, in

particular -

(a) determine, in relation to persons registered or enrolled

under this Act, what constitutes fitness and properness;

(b) determine, in relation to persons registered or enrolled

under this Act, the criteria of sound and prudent

management;

(c) determine the information which persons enrolled under

this Act shall disclose to persons seeking or making use

of intermediary services;

(d) determine the codes of conduct which may regulate

any aspect of dealings between persons registered or

enrolled under this Act and authorised insurance

undertakings or authorised reinsurance undertakings, or

between such persons and persons seeking or making use

of intermediary services;

(e) determine, in relation to insurance distribution activities,

the issuing of advertisements and the undertaking of

any other promotional activities.

(4A) The competent authority may make, amend or revoke

Insurance Distribution Rules and Conduct of Business Rules, as

may be required for the purpose of implementing any guidelines

and recommendations issued by EIOPA under Article 16 of

Regulation (EU) No. 1094/2010, for the implementation of the

Insurance Distribution Directive.

(4B) The competent authority shall monitor the market relating

to insurance and reinsurance distribution activities, including the

market for ancillary insurance products which are marketed,

distributed or sold in, or from, Malta.

INSURANCE DISTRIBUTION

PART III

REGISTRATION OR ENROLMENT OF INSURANCE AGENTS,

INSURANCE MANAGERS AND INSURANCE BROKERS

This Part of the Act applies to persons acting as insurance

agents, insurance managers and insurance brokers, carrying out

insurance distribution activities, reinsurance distribution activities or

both activities hereinafter referred to as "the intermediary".

(1) Subject to sub-article (3), no person shall act as an

intermediary and carry out, or attempt to carry out, in or from Malta,

insurance distribution activities and reinsurance distribution activities,

unless such person is registered or enrolled under article 13.

(2) The competent authority shall not grant registration or

enrolment under article 13 to a person nor shall the competent

authority permit such person to be registered or enrolled thereunder

or to remain so registered or enrolled, unless it is satisfied that such

person fulfils or complies with the requirements set out in this Part

of the Act.

(3) This article shall not apply to a person, which is registered

pursuant to the Insurance Distribution Directive in a Member State or

EEA State, other than Malta.

The competent authority shall establish and maintain

registers of persons carrying out the insurance distribution activities or

reinsurance distribution activities of insurance agents, insurance

managers and insurance brokers, in this Act separately referred to

as the "Agents Register", the "Managers Register" or the "Brokers

Register", containing such particulars as the competent authority

may determine from time to time, by Insurance Distribution Rules

made for the purposes of this article, of all persons which are

entitled under this Act to be registered therein and to apply in the

manner determined by the said Insurance Distribution Rules to be so

registered.

(1) A person shall be entitled to be registered in the

"Agents Register", the "Managers Register" or the "Brokers

Register" if such person satisfies the competent authority that the

person -

(a) is an individual;

(b) is fit and proper to be so registered and to ensure the

company’s sound and prudent management;

(c) has appropriate knowledge and ability in order to

complete tasks and perform duties adequately, in relation

to insurance distribution activities and reinsurance

distribution activities and possesses the qualifications

and fulfils or complies with the requirements determined

by Insurance Distribution Rules made for the purposes of

this article.

(2) A person shall not be entitled to carry out insurance

distribution activities and reinsurance distribution activities by virtue

of his registration under this article unless he is a director or an

INSURANCE DISTRIBUTION

employee of a company enrolled under article 13.

(1) The competent authority shall establish and maintain a list

of persons carrying out insurance distribution activities and

reinsurance distribution activities of insurance agents, insurance

managers and insurance brokers, in this Act separately referred to as

the "Agents List", the "Managers List", or the "Brokers List",

containing particulars of all persons which are entitled under this Act

to be enrolled therein and which apply in the manner determined from

time to time by the competent authority in Insurance Distribution

Rules made for the purposes of this article. The said Lists shall be

updated on a regular basis.

(2) The Agents List, the Managers List, and the Brokers List

are to specify the names of the registered individuals within the

management of the intermediary who are responsible for the

insurance distribution activities or reinsurance distribution

activities.

(3) In the case of cross-border activities carried out in terms of

the Insurance Distribution Directive, the Agents List, the Managers

List, and the Brokers List shall also indicate the Member States or

the EEA States in which the intermediary is carrying out insurance

distribution activities or reinsurance distribution activities, and the

competent authority shall communicate that information to EIOPA,

for the purpose of publication on EIOPA’s single electronic register

in terms of Article 3(4) of the Insurance Distribution Directive.

(4) The competent authority shall have the right to modify such

data stored on EIOPA’s single electronic register referred to in sub-

article (3), and data subjects, whose personal details are stored on such

register and exchanged, shall have the right to access such stored data

and the right to be appropriately informed.

(1) Subject to paragraph (b), the intermediary shall be

entitled to be enrolled in the Agents List, Managers List or the

Brokers List if, it satisfies the competent authority that

(a) in the case of an applicant which is a company

(i) the applicant’s objects are limited to operations

arising directly from insurance distribution

activities or reinsurance distribution activities

listed in paragraphs (1), (2) and (3) of the Third

Column of the Schedule, as applicable, and to

matters or functions connected therewith or

ancillary thereto, to the exclusion of all other

commercial business, other than business

determined by Insurance Distribution Rules

made for the purposes of this article;

(ii) the applicant discloses to the satisfaction of the

competent authority such information as the

competent authority has requested of it in

relation to persons who will, upon its enrolment,

have any proprietary, financial or other interest

in, or in connection with, the applicant;

(iiA) the applicant discloses the identity of the

INSURANCE DISTRIBUTION

shareholders, direct or indirect, whether natural

or legal persons, who will have qualifying

holdings in that intermediary and the amounts of

those holdings;

(iiB) the applicant discloses the identity of persons who

have close links with the applicant;

(iii) all qualifying shareholders, controllers, directors

and all persons who will effectively manage the

affairs or carry out the operations appropriate to

the application are fit and proper persons to

ensure its sound and prudent management;

(iiiA) the applicant possesses appropriate knowledge

and ability in order to be able to complete tasks

and perform duties adequately, in relation to

insurance distribution activities and reinsurance

distribution activities, as determined by Insurance

Distribution Rules made for the purposes of this

article;

(iv) the applicant’s own funds, whether in euro or in

other currencies acceptable to the competent

authority are at all times not less than such

amount appropriate for the kind of business to be

carried on by it as may be determined by

Insurance Distribution Rules made for the

purposes under this Act and such own funds

shall at all times be unencumbered;

(v) the applicant has at all times in its favour a

policy of professional indemnity insurance or

some other comparable guarantee, in each case

acceptable to the competent authority,

indemnifying it or any person employed by it or

otherwise acting for it, to such amount, in such

manner and in respect of such matters as the

competent authority may from time to time

determine by Insurance Distribution Rules;

(vi) the applicant submits to the satisfaction of the

competent authority a scheme of operations

appropriate to the application which shall

include the particulars or proof as may be

determined by Insurance Distribution Rules;

(b) in the case of an applicant who is an individual

(i) sub-article (1)(a)(i), (iiA) and (iii) shall not apply;

and

(ii) he shall be entitled to be enrolled in the Agents

List, Managers List or the Brokers List if the

applicant satisfies the competent authority that

the individual

(aa)is fit and proper to be so enrolled and to

ensure that the business is carried on in a

sound and prudent manner;

(bb)has appropriate knowledge and ability in

INSURANCE DISTRIBUTION

order to complete tasks and perform duties

adequately in relation to insurance

distribution activities and reinsurance

distribution activities and possesses the

qualifications and fulfils or complies with

the requirements as determined by the Act

and Insurance Distribution Rules made for

the purposes of this article;

(cc)carries out activities which are limited to

operations arising directly from insurance

distribution activities and reinsurance

distribution activities, and matters and

functions connected therewith or ancillary

thereto, to the exclusion of all other

commercial business, other than business

determined by Insurance Distribution Rules;

(dd)discloses the identity of persons who have

close links with the applicant.

(2) Where the holdings or close links referred to in sub-article (1)

exist between the intermediary and any other person, the competent

authority shall

(a) only grant enrolment if it considers that such holdings or

close links do not prevent it from effectively exercising

its supervisory functions; and

(b) refuse to grant enrolment if it considers that the laws,

regulations or administrative provisions of any

country, other than Malta, governing any person with

whom the intermediary has close links, or their

enforcement, prevent it from effectively exercising its

supervisory functions.

(3) Where the application is for enrolment to carry out insurance

distribution activities or reinsurance distribution activities as an

insurance agent or insurance manager, the applicant is required to

produce proof to the satisfaction of the competent authority that

such person holds an appointment in writing signed by a senior

officer of an insurer, reinsurer or an insurance broker, as the case may

be, for which the applicant desires to act designating the applicant

to act in the name and on behalf of the company, or solely on behalf

of the company, in the capacity specified in the appointment and in

respect of matters and under the conditions specified in that

appointment

Provided that, where an application is for enrolment to act

as an insurance manager, the appointment referred in this paragraph

shall not constitute a prerequisite condition for granting enrolment

in that behalf provided that the enrolled insurance manager shall not

act for an insurer, reinsurer or an insurance broker, as the case may

be, unless and until it produces proof to the satisfaction of the

competent authority that it holds an appointment in writing from

the company concerned to act on its behalf.

INSURANCE DISTRIBUTION

(1) In the case of an applicant which is a local company,

such company shall be entitled to be enrolled in the

(a) Agents List if, in addition to the requirements of

article 10, the competent authority is satisfied that any

one or more of the company’s directors are registered

in the Agents Register;

(b) Managers List if, in addition to the requirements of

article 10, the competent authority is satisfied that any

one or more of the company’s directors are registered

in the Managers Register;

(c) Brokers List if, in addition to the requirements of

article 10, the competent authority is satisfied that any

one or more of the company’s directors are registered

in the Brokers Register,

and the insurance distribution activities or reinsurance distribution

activities are carried out under the management of a registered

(2) A person enrolled under article 13 may, with the approval of

the competent authority given in writing, open a branch or set up or

acquire a subsidiary in Malta.

(3) The competent authority may permit a person enrolled as

aforesaid to open a branch in Malta if it is satisfied that the insurance

distribution activities or reinsurance distribution activities carried on

by it from the branch are conducted by a registered person.

(4) Except with the written consent of the competent authority, no

person enrolled under this Part of the Act may carry out, nor hold itself

as carrying out, insurance distribution activities or reinsurance

distribution activities, open a branch, office or other place of business,

or set up or acquire a subsidiary, in any country outside Malta.

(1) In the case of an applicant which is a foreign company,

such company shall be entitled to be enrolled in the Agents List,

Managers List or Brokers List if, in addition to the requirements of

article 10, the competent authority is satisfied that -

(a) the company is registered or permitted in the country

where its head office is situated to carry out insurance

distribution activities or reinsurance distribution

activities;

(b) the company has in Malta at all times -

(i) a branch; and

(ii) a representative

Provided that, a company carrying on business as an

insurance broker restricted to contracts of insurance

relating to risks situated outside of Malta or

commitments where Malta is not the country of

commitment may, either in lieu of or in addition to

opening a branch in Malta, appoint an insurance

manager enrolled under the Act to manage such

business; and as long as the insurance manager holds

such appointment, the business of insurance broking

INSURANCE DISTRIBUTION

shall be under the management of a registered

insurance broker.

(2) In relation to a branch of a foreign company carrying out

insurance distribution activities or reinsurance distribution activities as

may be prescribed, the insurance distribution activities or reinsurance

distribution activities shall be carried out from such branch by an

individual who satisfies the following requirements

(a) in the case of a company carrying out insurance

distribution activities or reinsurance distribution

activities -

(i) the individual is registered in the Agents

Register, Managers Register or Brokers

Register;

(ii) the individual is a director of the company or has

authority to act for the company and the

insurance distribution activities or reinsurance

distribution activities are carried on under his

management;

(iii) the individual is not an approved auditor, or a

partner or an employee of an approved auditor of

the company;

(b) in the case of a company carrying on other insurance

distribution activities or reinsurance distribution

activities as may be prescribed, provisions as may be

prescribed.

(1) An application for registration or enrolment under this

article shall be made in such form and manner as the competent

authority may from time to time determine.

(2) The competent authority shall have the power to require an

applicant to provide such information as it may deem necessary for

the purpose of determining an application for registration or

enrolment under this article.

(3) The competent authority may grant registration or

enrolment under this article only if it is satisfied on the basis of

information required to be submitted under this Act and any

regulations or Insurance Distribution Rules made thereunder, and any

information received by it, that registration or enrolment ought to be

granted.

(4) Subject to the provisions of this Act, the competent

authority may subject registration or enrolment made under this

article to such conditions as it may from time to time deem fit to

impose.

(5) The competent authority shall determine an application for

registration or enrolment under this article within three months of

receiving the information required to be submitted under this Act and

any regulations or Insurance Distribution Rules made thereunder. The

competent authority shall notify the applicant of its decision, without

undue delay; and if it refuses to grant the registration or enrolment

it shall inform the applicant in writing of the reasons for the

INSURANCE DISTRIBUTION

refusal

Provided that, in each case the competent authority may

take such measures as it may deem necessary for the protection of

the interest of the public.

(6) The validity of the registration or enrolment under this article

shall be subject to a regular review by the competent authority.

(1) On granting registration or enrolment under article 13,

the competent authority shall issue to the applicant concerned a

certificate of registration or enrolment in the form and manner as it

deems appropriate evidencing -

(a) in the case of an application for registration,

registration of the applicant in the Agents Register,

Managers Register, or Brokers Register, as the case

may be;

(b) in the case of an application for enrolment, enrolment

of the applicant in the Agents List, Managers List or

Brokers List, as the case may be.

(2) A certificate of registration or enrolment issued under this

article or an official copy thereof shall be prominently displayed by

the intermediary concerned at his, or its place or places of business,

in a part thereof to which the public has access.

(3) The competent authority may by means of Insurance

Distribution Rules made for the purposes of this article, determine

the details to be included in the certificate of registration or

enrolment.

An intermediary carrying out insurance distribution activities

or reinsurance distribution activities and its employees, carrying out

insurance or reinsurance distribution activities, shall comply with

continuing professional training and development requirements in

order to maintain an adequate level of performance corresponding to

the role they perform and the relative market, as may be determined by

means of Insurance Distribution Rules and, or Conduct of Business

Rules issued for the purposes of this article.

PART IV

POWERS OF INTERVENTION IN RELATION TO PERSONS

ENROLLED UNDER PART III

(1) An intermediary registered or enrolled under this Act

shall automatically be struck off the register or list, if -

(a) the intermediary does not commence to carry out the

insurance distribution activities or reinsurance

distribution activities pursuant to the enrolment within

twelve months of it being granted, or within such other

period as may be specified in the enrolment; or

(b) the intermediary is declared bankrupt or goes into

liquidation or makes a composition with creditors of

the intermediary or is otherwise dissolved; or

INSURANCE DISTRIBUTION

(c) the intermediary has ceased to operate as a result of a

merger with another company carrying out insurance

distribution activities or reinsurance distribution

activities, or for any other reason whatsoever; or

(d) in the case of a foreign company enrolled in terms of

article 13, the overseas regulatory authority in the

country of registration or where the head office is

situated withdraws the registration or permission to

carry out such activities.

(2) Sub-article (1)(a) shall not apply to a person enrolled to act

as an insurance manager.

Without prejudice to anything contained in any other

provision of this Act, the competent authority may at any time

suspend registration or enrolment or strike off the name of a

registered or enrolled person from the Agents Register, Managers

Register or Brokers Register, or the Agents List, Managers List or

Brokers List if -

(a) any document or information accompanying an

application for registration or enrolment, or any

information given in connection therewith, is false,

incorrect or misleading in any material particular, or

the registered or enrolled person has concealed, or

conceals from, or fails to notify to the competent

authority any document or information or change

therein which was the duty of the intermediary to

reveal or to notify under this Act and any regulations,

Insurance Distribution Rules or Conduct of Business

Rules made thereunder;

(b) it considers that the registered or enrolled person does

not fulfil the requirements of, or has contravened, any

of the provisions of this Act and and any regulations,

Insurance Distribution Rules or Conduct of Business

Rules made thereunder, or has failed to satisfy or

comply with any condition to which he or it, or the

registration or the enrolment, is subject by virtue of or

under this Act; or

(c) it considers that the registered or enrolled person is

unfit to retain his or its name in the Agents Register,

Managers Register, Brokers Register or the Agents

List, Managers List or Brokers List; or

(d) the enrolled company is no longer managed in a sound

and prudent manner to retain its name in the Agents

List, Managers List or Brokers List; or

(e) it receives a written request so to do by the registered

or enrolled person; or

(f) the enrolled person no longer possesses the required

own funds as applicable; or

(g) the enrolled person fails to pay the annual continuance

of registration or enrolment fee when due; or

(h) the registered person does not hold a directorship in, or

INSURANCE DISTRIBUTION

is no longer employed with, the enrolled company; or

(i) the enrolled company ceases to have on its board of

directors any one person who is a registered person; or

(j) it considers that, by reason of the manner in which the

registered or enrolled person is carrying out insurance

distribution activities or reinsurance distribution

activities, or for any other valid reason, the interest of

the insurance industry or of the public is threatened; or

(k) the registered individual or the enrolled person has

misappropriated or converted to his or to its own use

or illegally withheld monies held, or required to be

held, by him or by it in a fiduciary capacity; or

(l) the registered or enrolled person is convicted by any

court of law of any criminal offence, unless it is an

offence which, owing to its trivial nature or the

circumstances under which it was committed, does not

render it or him unfit to have his name in the Agents

Register, Managers Register or Brokers Register or the

Agents List, Managers List or Brokers List; or

(m) the registered or enrolled person is considered by the

competent authority to have carried on insurance

distribution activities or reinsurance distribution

activities in an unprofessional manner; or

(n) the competent authority is prevented from exercising

its supervisory functions effectively because of the

existence of close links as may be defined by means of

Insurance Distribution Rules made under this Act;

(o) the enrolled insurance agent or insurance broker is not

utilising the services of intermediaries as required in terms

of article 44B; or

(p) the registered or enrolled person fails to comply with the

conduct of business requirements in relation to an

insurance-based investment product or in relation to any

insurance product other than an insurance-based

investment product, set out in Conduct of Business Rules;

or

(q) the registered or enrolled person ceases to fulfil any of the

requirements laid down in articles 8(1)(b) and (c),

10(1)(a)(iii), (iiiA), (iv) and (v), 10(1)(b)(ii)(aa) and (bb),

14A and 20, and where applicable, any Insurance

Distribution Rules issued under the said articles.

(1) Subject to the following provisions of this article,

where the competent authority intends to suspend a registration or

enrolment or strike the name of a registered or enrolled person off

the Agents Register, Managers Register or Brokers Register, or the

Agents List, Managers List or Brokers List, it shall give the person

concerned notice in writing setting out the reasons for its intention

INSURANCE DISTRIBUTION

(2) Every notice given under sub-article (1) shall state that the

person concerned may, within such reasonable period after the

service thereof as may be stated in the notice (being a period of not

less than forty-eight hours and not longer than thirty days), make

representations in writing to the competent authority giving reasons

why the registration or enrolment should not be suspended or the

name of the person struck off the Agents Register, Managers

Register or Brokers Register, or the Agents List, Managers List or

Brokers List, as applicable, and the competent authority shall

consider any representations so made before arriving at a final

decision.

(3) The competent authority shall notify in writing its final

decision to the person concerned.

(4) On notification by the competent authority to a person that

his or its name has been suspended or has been struck off the

Agents Register, Managers Register or Brokers Register or the

Agents List, Managers List or Brokers List, the intermediary shall

forthwith surrender to the competent authority the certificate of

registration or enrolment, and any official copies thereof; and in

each case, the competent authority may take such other measure as

it may deem necessary to safeguard the interests of insureds,

policyholders, creditors or other interested persons.

(5) Where the competent authority has suspended the

registration or enrolment or struck off the name of a person from

the Agents Register, Managers Register or Brokers Register or the

Agents List, Managers List or Brokers List on any of the grounds

specified in article 16 of this Act, the competent authority shall give

publicity to such suspension or striking off, and the provisions of

article 53A shall apply.

(6) The competent authority shall have power to order that all

expenses, incurred by it in relation to such publicity, or such part

thereof, as it deems appropriate, shall be paid by the person

concerned; and any sum so due shall be recoverable by the

competent authority in the same manner as an administrative

penalty imposed under this Act.

(1) Where the name of a person has been struck off the

Agents Register, Managers Register or Brokers Register or the

Agents List, Managers List or Brokers List, in pursuance of a

decision under article 16, the name of that person shall not again be

entered in the register or list unless -

(a) otherwise ordered by the Tribunal; or

(b) in the absence of such order, the competent authority,

on an application made to it in that behalf, otherwise

decides.

(2) The competent authority shall determine an application for

restoration of a name of a person to the Agents Register, Managers

Register, or Brokers Register or the name of an enrolled person to

the Agents List, Managers List or Brokers List under this article

within three months of receiving the information required to be

submitted under this Act as if the application were an application

INSURANCE DISTRIBUTION

made under article 13; and if it refuses to restore a name of an

individual or of a company to the register or list, it shall inform the

applicant in writing of the reasons for the refusal.

(3) Sub-article (2) shall not apply where the restoration of a

name of a person to the Agents Register, Managers Register, and

Brokers Register or the Agents List, Managers List or Brokers List

is made by an order of the Tribunal.

(1) Without prejudice to the powers conferred to the

competent authority under article 16, the competent authority may,

where it is satisfied that sufficient serious circumstances exist,

proceed to take one or more of the following measures

(a) require the intermediary forthwith to take such steps as

the competent authority may consider necessary to

rectify or remedy the circumstances;

(b) appoint a person to advise the intermediary in the

proper conduct of its business;

(c) appoint a person to take charge of the assets of the

intermediary, or any portion of them, for the purposes

of

safeguarding

the

interests

of

insureds,

policyholders, creditors or other interested persons

and, in the case of a local company, shareholders of the

company;

(d) appoint a person to assume control of the business of

the intermediary, either to carry on that business or to

carry out such other function or functions in respect of

such business, or part thereof, including to take the

necessary action for the intermediary to be dissolved and

wound up, as the competent authority may direct;

(e) issue an order for the dissolution and winding up of the

enrolled company or, in the case of a foreign company,

for the winding up of its business in Malta;

(f) appoint a competent person to act as liquidator for the

purpose of winding up the affairs of the enrolled

company;

(g) fix the remuneration to be paid by the intermediary to

any person appointed under this article;

(h) require the intermediary to submit a financial recovery

plan if it considers that the interest of insureds,

policyholders, creditors or other interested persons are

likely to be prejudiced owing to a deterioration in the

financial position of the intermediary;

(i) require a registered or enrolled person to remove the

word "insurance" as part of his or its description or

title and not make use of such word on any letter

paper, in any notice or advertisement, or in any another

similar manner;

(j) do such other act or require the doing of such other

thing as it may deem appropriate in the circumstances,

and having proceeded in any one or more of the manners aforesaid,

INSURANCE DISTRIBUTION

the competent authority may further proceed in any one or more of

such manners, whether in addition thereto or in substitution

(2)

Where a person is appointed by the competent authority -

(a) under sub-article (1)(b), it shall be the duty of the

intermediary to act in accordance with the advice

given by such person unless and until the competent

authority, on representations made to it, directs

otherwise;

(b) under sub-article (1)(c), the intermediary shall deliver

to such person all the assets of which he is placed in

charge, and all the powers, functions and duties of the

intermediary in respect of those assets, and in relation

to a company, whether exercisable by the company in

general meeting, or by the directors, or by any other

person, including the legal and judicial representation

of the intermediary, shall be exercisable by and vest in

the person appointed under the said sub-article to the

exclusion of any other person;

(c) under sub-article (1)(d), the intermediary shall submit

the business to the control of such person and shall

provide him with such facilities as he may require the

intermediary to provide him to carry on that business

or to carry out the functions assigned to him under the

said sub-article; and all the powers, functions and

duties of the intermediary, and in relation to a

company whether exercisable by the intermediary in

general meeting, or by the directors, or by any other

person, including for the purposes of the dissolution and

winding up of the intermediary as well as the legal and

judicial representation of the intermediary in all matters,

shall be exercisable by and vest in him to the exclusion

of any other person;

(d) under sub-article (1)(f), such person shall be the

liquidator of the intermediary for all purposes of law to

the exclusion of any other person

Provided that the competent person shall not take any

decision for the purpose of the dissolution and winding

up of the intermediary, unless the competent authority

issues a directive to that effect in terms of article 31A of

the Insurance Business Act, made applicable by article

54 of the Act, and any such directive may contain such

instructions, requirements and conditions as the

competent authority may consider necessary, including

with regard to the mode of winding up.

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(2A) Without prejudice to the powers of the competent

authority in terms of sub-article (1), the competent

authority may also make an application to the court for

the dissolution and winding up by the court of an

intermediary, where it appears to the competent authority

that an intermediary should be dissolved and wound up

by the court for the reason set out in article 214(2)(b)(iii)

of the Companies Act, and where the court accedes to the

application, the relevant provisions of the Companies

Act in relation to the dissolution and winding up by the

court and any other applicable provisions of any other

law shall apply.

(3) In the case of a foreign company, the branches and offices

in Malta of that company shall, if the competent authority so directs

and to the extent it so directs be deemed to constitute a separate

company.

(4) Any measure adopted in terms of sub-article (1) shall remain

in force notwithstanding that an intermediary ceases to be enrolled for

whatever reason, unless the competent authority otherwise directs.

PART V

OBLIGATIONS OF PERSONS ENROLLED UNDER PART III

(1) Every person enrolled under article 13 shall keep

monies held by him or it in a fiduciary capacity separate from his or

its own monies and shall, in respect of those monies, maintain

separate accounts in accordance with requirements determined by

Insurance Distribution Rules made for the purposes of this article.

(2) No person shall have or obtain any recourse or right against

monies standing to the credit of the account referred to in sub-

article (1) in respect of a claim or right against an enrolled person

until all proper claims arising out of insurance distribution activities or

reinsurance distribution activities against those monies have been

satisfied, even in the event of bankruptcy of the individual or

insolvency of the company, as the case may be.

(1) Without prejudice to article 20, every person enrolled

under article 13 shall effect a fidelity bond in a specified form, as

respects the insurance distribution activities carried on by the

intermediary concerned, in such circumstances, to such value, in

such manner and under such conditions as may be determined by

Insurance Distribution Rules made for the purposes of this article.

(2) The bond referred to in sub-article (1) shall provide that in

the event of the inability or failure of the enrolled person to meet

his or its financial obligations in relation to any sums of money

received by him or it from, or on behalf of, his or its clients, a sum

of money will become available to a person nominated or approved

by the competent authority, to be applied for the benefit of any

client of the enrolled person who has incurred loss or liability

because of the inability or failure of the enrolled person to meet

such financial obligations.

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The provisions of articles 20 and 21 shall not apply to a

person enrolled as an insurance manager for so long as such person

holds no appointment from any insurer or an insurance broker for

so acting.

Every enrolled company shall, not later than the end of

January of each year, notify in writing the competent authority in

such manner as the competent authority may require, the name and

the other particulars as it may also require, of every director and

employee of the company who are registered in the Agents

Register, Managers Register or Brokers Register; and during the

following twelve months, the company shall give notice in writing

to the competent authority of any change that may, from time to

time, occur among such directors and employees and such notice

shall be given within such period as may be specified by Insurance

Distribution Rules.

(1) Every enrolled company shall, not later than four

months from the date of closing of its financial year, or at any other

time as may exceptionally be authorised in writing by the

competent authority, forward to the competent authority a copy of

its audited financial statements drawn up -

(a) in the case of a local company, in accordance with the

provisions of the Companies Act; and

(b) in the case of a foreign company, in accordance with

the provisions of the laws of the country where the

registered office or head office of the company is

situated governing the financial statements of such

companies.

(2) Every enrolled person who is an individual shall provide

income statements drawn up in a manner as determined by

Insurance Distribution Rules made for the purposes of this article

and such statements shall be forwarded to the competent authority

within such period as may be specified by Insurance Distribution

Rules.

(1)

Subject to the following sub-articles, an enrolled

person shall submit to the competent authority any information which

is necessary for the purposes of supervision, as may be specified by

means of regulations, Insurance Distribution Rules or Conduct of

Business Rules, which may also specify the period within which this

information is to be submitted.

(2)

The information to be submitted to the competent authority

in terms of sub-article (1) shall include the submission of statements

relating to the business of insurance distribution activities and, or

reinsurance distribution activities, carried on by an enrolled person in

any calendar year. The statements relating to that business shall be

made out in the form, manner and content as the competent authority

may, by Insurance Distribution Rules made for the purposes of this

article determine; and the date by which such statements shall be

forwarded shall also be established by Insurance Distribution Rules.

INSURANCE DISTRIBUTION

(3) The statements required to be submitted under sub-article (2)

shall be verified in the manner required by Insurance Distribution

Rules, and the competent authority may at any time direct an enrolled

person to submit to it such statements at such interval and for such

period as it may specify in the Insurance Distribution Rules.

(1) An enrolled person shall not cease to carry out, in or

from Malta, insurance distribution activities or reinsurance

distribution activities, except with the permission of the competent

authority given in writing on an application made to it in that

behalf in such manner as it may require, and in compliance with

such conditions as it may deem proper to impose.

(2) The application for ceasing shall be submitted to the

competent authority not later than three months before the date on

which the enrolled person intends cease to carry out such activities.

PART VI

FINANCIAL YEAR AND AUDITORS

(1) A company enrolled under article 13 which is a local

company shall, not later than three months from the date of a

company’s enrolment, notify in writing the competent authority of

the financial year and, failing such notice, the financial year of the

enrolled company shall terminate on the thirty-first day of

December of each year.

(2) No enrolled company as aforesaid shall alter its financial

year unless and until the competent authority has given its approval

in writing on an application made to it in that behalf.

(3) Every foreign company applying for enrolment under

article 13 shall, on application, notify in writing the competent

authority of its financial year; and after enrolment under that

article, where a foreign company alters its financial year, it shall

forthwith inform in writing the competent authority of such change.

(4)

For the purposes of this Act "financial year" -

(a) in relation to an enrolled company which is a local

company, means an accounting period as is construed

in accordance with articles 164 to 166 of the

Companies Act;

(b) in relation to an enrolled company which is a foreign

company, means an accounting period as is construed

in accordance with the provisions of the laws of the

country where the registered office or the head office

of the company is situated governing the accounting

period of such companies.

(1) Every person enrolled under article 13 shall each year

appoint an approved auditor as auditor to the company whose duty

shall be to report on the financial statements of the company or the

income statements of the individual, as applicable, examined by him

and on financial statements or income statements prepared by the

company or individual, respectively.

(2)

If the enrolled person fails to appoint an auditor as required

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by sub-article (1) or at any time fails to fill any vacancy in the

office of an auditor, the competent authority shall have the power to

appoint an auditor for that person and shall fix the remuneration to be

paid by that person to such auditor.

(3) The auditor’s report shall include a statement on compliance

by the enrolled person with requirements specified by means of

Insurance Distribution Rules made for the purposes of this article,

which may also specify the information to be contained in such

statement.

(4) Every auditor of an enrolled person shall have the right to

demand such information or explanation as he deems necessary in

the performance of his duties from any officer or employee of, or

any person under an appointment from, that enrolled person.

(5) An auditor shall immediately give notice in writing to the

competent authority if -

(a) he resigns;

(b) he does not seek to be re-appointed; or

(c) he decides to qualify the audit report,

and, in the situations mentioned in paragraphs (a) and (b), the

auditor shall specify the reasons for so doing.

(6) An enrolled company shall give notice in writing to the

competent authority immediately it receives notice of a resolution

intended to be put before the company’s annual general meeting to

appoint as an auditor a person other than the retiring auditor or

otherwise providing expressly that the retiring auditor shall not be

reappointed.

(7) Where, for any reason whatever, the appointment of an

auditor comes to an end, the enrolled person shall not later than

fourteen days from the termination of such appointment, give

notice in writing to the competent authority stating reasons for such

termination.

(8) The competent authority may require an enrolled person to

change its appointed auditor where, in the competent authority’s

opinion, such auditor is considered unfit for this appointment, at

any time during his term of office.

(9) Before requiring an enrolled person to change the appointed

auditor in the circumstances mentioned in sub-article (8), the

competent authority shall notify in writing its intention to the

enrolled person and the auditor concerned stating reasons for

requiring such change and giving the auditor the opportunity to

submit, in writing, within fourteen days from the date of serving of

such notice, the reasons why his appointment with the enrolled person

should not be terminated.

(10) For the purposes of this Act, an approved auditor shall be a

person who is qualified to be an auditor in accordance with the

Companies Act and holds the authorisation of the competent

authority to act as auditor issued to him under the Insurance

Business Act.

(11) Notwithstanding anything contained in the foregoing sub-

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articles, the competent authority may, in the case of a foreign

company, approve such alternative arrangements as it thinks

reasonable and which do not materially detract from the main

objects of this article, and where such arrangements have been

carried out, the provisions of this article shall not apply to the

extent that they are replaced by such arrangements.

(12) If, in his capacity as auditor of an enrolled person or branch in

Malta of a foreign company enrolled under article 13 or due to a

direct request by the competent authority under this Act, an auditor

becomes aware of any matter which relates to and may have a

serious adverse effect upon the stability and soundness of the

company or the integrity of the insurance distribution activities and

reinsurance distribution activities carried on in Malta by the enrolled

person or branch in Malta of a foreign company enrolled under article

13, he shall immediately inform the competent authority, in the case of

a c o m p a n y, t h r o u g h t h e i n t e r m e d i a r y ’s m a n a g e m e n t o r, i f

circumstances so warrant, directly to the competent authority, and in

the case of an individual, directly to the competent authority.

(13) For the purposes of sub-article (12), any matter which

relates to and may have a serious adverse effect is any matter that

(a) is likely to lead to a serious qualification or refusal of

the auditor’s report on the accounts of the company or

income statements of the individual; or

(b) gravely impairs the ability of the company to continue as

a going concern or the ability of the enrolled person or

branch in Malta of a foreign company enrolled under

article 13 to continue carrying out the activities in

respect of which it is enrolled; or

(c) is a material breach of the provisions of this Act,

regulations or Insurance Distribution Rules which lay

down the conditions governing registration or enrolment

or which specifically govern the carrying out of

insurance distribution activities and reinsurance

distribution activities by an enrolled person.

(14) An auditor of an enrolled person or a branch in Malta of a

foreign company enrolled under article 13 shall likewise have a duty

to report to the competent authority any facts and decisions which

relate to or have a serious adverse effect upon the stability and

s o u n d n e s s o f t h e c o m p a n y o r the integrity of the insurance

distribution activities and reinsurance distribution activities carried out

in Malta by the enrolled person or branch in Malta of a foreign

company enrolled under article 13, of which he becomes aware in his

capacity as an auditor to an enrolled person or branch in Malta of a

foreign company enrolled under article 13 having close links within

the meaning of article 10.

(15) Without prejudice to any provision contained in this Act, the

competent authority may request the auditor to provide it with such

information and documentation relating to any fact or decision as

specified in sub-articles (12) or (14) concerning the enrolled person or

the branch in Malta of a foreign company enrolled under article 13.

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No duty, including the duty of professional secrecy, to

which -

(a) an auditor of a company enrolled under article 13 may

be subject, shall be regarded as contravened by reason

of his communicating in good faith to the competent

authority, whether or not in response to a request from

it, any information or opinion on a matter of which the

auditor has become aware in his capacity as auditor

and which is relevant to any functions of the

competent authority under the provisions of this Act or

is required to be communicated by virtue of this Act;

(b) a person appointed to make a report under any

provision of this Act may be subject, shall be regarded

as contravened by reason of his communicating in

good faith to the competent authority, whether or not

in response to a request made by it, on any matter

which relates to the business or affairs of an enrolled

company in relation to which a report is made.

PART VII

PROVISIONS APPLICABLE TO INTERMEDIARIES

CARRYING ON BUSINESS AS INSURANCE BROKERS

A local company enrolled under article 13 and carrying on

business as an insurance broker, restricted to contracts of insurance

relating to risks situated outside of Malta or commitments where

Malta is not the country of commitment, may appoint an insurance

manager enrolled under the Act to manage such business; and so

long as the insurance manager holds such appointment, the

business of insurance broking shall be under the management of a

registered insurance broker.

(1) Subject to the following sub-articles, except with the

approval of the competent authority given specifically in writing, a

contract of insurance relating to a risk situated in Malta or to a

commitment where Malta is the country of the commitment

negotiated, arranged or procured by an insurance broker on behalf

of an insured person or a person to be insured shall be taken out

with an authorised undertaking.

(2)

The provisions of this article shall not apply to -

(a) business of reinsurance;

(b) large risks as defined in Article 13 of the Solvency II

Directive.

(1) Subject to the following sub-articles, any person

enrolled in the Brokers List under article 13 may make or enter into

any underwriting agreement with any authorised undertaking.

(2) No person enrolled as aforesaid shall make or enter into any

underwriting agreement unless, with respect to that underwriting

agreement, the person complies with or satisfies such requirements

as the competent authority may by Insurance Distribution Rules

made for the purpose of this article determine.

(3)

Any person enrolled as aforesaid shall register with the

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competent authority any underwriting agreement made or entered

into under this article in the form and manner as the competent

authority may by Insurance Distribution Rules determine.

(4) No business of insurance shall be accepted under an

underwriting agreement unless the underwriting agreement has

been duly registered as aforesaid.

(5) The competent authority shall determine an application for

registration of an underwriting agreement under this article within

one month of receiving the information required to be submitted

under the Insurance Distribution Rules; and if it refuses to register

the agreement it shall inform the applicant in writing of the reasons

for the refusal.

(6) Subject to the provisions of this Act, the competent

authority may subject registration of any underwriting agreement

made under this article to such conditions as it may from time to

time deem fit to impose.

(7) For the purposes of this article "underwriting agreement",

in relation to business of insurance, means an agreement between

an authorised undertaking and a person enrolled in the Brokers List

u n d e r a r t i c l e 1 3 u n d e r w h i c h t h e e n r o l l e d p e r s o n m a y, i n

accordance with the terms thereof, accept risks on behalf of the

authorised undertaking; and, in this context, any other arrangement,

by whatever name it may be called, whose objects and purposes are

similar to an underwriting agreement, for the purposes of this

article, is deemed to be an underwriting agreement.

PART VIII

REGISTRATION AND ENROLMENT OF TIED INSURANCE

INTERMEDIARIES

(1) Subject to sub-article (2), no person shall act as a tied

insurance intermediary and carry out, or attempt to carry out in

Malta tied insurance intermediaries activities unless such person is

appointed, registered and enrolled in accordance with the

provisions of this Act.

(2) This article shall not apply to a person which is registered

pursuant to the Insurance Distribution Directive, in a Member State or

an EEA State, other than Malta.

(1) Subject to article 43, every authorised undertaking

desirous of appointing a person to act on its behalf as a tied

insurance intermediary shall establish and maintain a register of

persons acting as tied insurance intermediaries, in this Act referred

to as the "Tied Insurance Intermediaries Company Register",

containing the particulars as the competent authority may, from

time to time, by Insurance Distribution Rules made for the purposes

of this article, determine, of all persons who are entitled under this

Act to be registered therein.

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(2) Subject to the provisions of sub-article (1), every

authorised undertaking shall determine its own procedures for

appointing and registering a person as a tied insurance intermediary

in the Tied Insurance Intermediaries Company Register.

(1) A person shall be entitled to be registered by an

authorised undertaking in the Tied Insurance Intermediaries

Company Register of such undertaking if it is satisfied that such

person

(a) is fit and proper to carry out tied insurance

intermediaries activities; and

(b) possesses appropriate knowledge and ability in order

to complete tasks and perform duties adequately, in

relation to tied insurance intermediaries activities, as

determined by means of Insurance Distribution Rules

issued for the purposes of this article.

(2) A person shall not be entitled to carry out tied insurance

intermediaries activities, by virtue of his registration under article

37 unless and until he is enrolled by the competent authority in the

Tied Insurance Intermediaries List under that article.

A tied insurance intermediary carrying out tied insurance

intermediaries activities shall comply with continuing professional

training and development requirements in order to maintain an adequate

level of performance corresponding to the role such intermediary

performs, as may be determined by means of Insurance Distribution

Rules and, or Conduct of Business Rules issued for the purposes of

this article.

(1) The competent authority shall establish and maintain a

list of persons carrying out tied insurance intermediaries activities

in this Act referred to as the "Tied Insurance Intermediaries List",

containing such particulars as the competent authority may,

determine from time to time by Insurance Distribution Rules made

for the purposes of this article of all persons who are, or which are,

entitled under this article to be enrolled therein. The Tied Insurance

Intermediaries List shall be updated on a regular basis.

(2) It shall be the duty of an authorised undertaking to enrol

with the competent authority in the Tied Insurance Intermediaries

List any person registered by it as a tied insurance intermediary in

the Tied Insurance Intermediaries Company Register established

and maintained by it under article 37.

(3) On obtaining from the competent authority a certificate of

enrolment under article 37, an authorised undertaking shall furnish

the person, in whose name the certificate of enrolment is made out,

with the certificate or an official copy thereof, issued to the

authorised undertaking by the competent authority.

(4) Where a person enrolled as aforesaid carries out tied

insurance intermediaries activities from a place of business or from

any other place accessible to the public, that person shall display in

a prominent position in that place in a part thereof to which the

public has access, the certificate of enrolment or an official copy

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thereof issued by the competent authority under this article.

(5) Where the enrolled person is not an individual, the Tied

Insurance Intermediaries List is to specify the name of the individual

who carries out tied insurance intermediaries activities and who

satisfies the requirements of article 35(1).

(1) Subject to the provisions of this Act, every authorised

undertaking desirous of appointing a person to act on its behalf as a

tied insurance intermediary shall, under this article, appoint and

register in the Tied Insurance Intermediaries Company Register of

the authorised undertaking and enrol with the competent authority

in the Tied Insurance Intermediaries List, any one or more persons

to act on its behalf as tied insurance intermediaries and to carry out

tied insurance intermediaries activities in the class or classes of

long term business or the group or groups of classes of general

business specified in their respective appointments and, where a

person is not an individual, such person must itself have an

individual who satisfies the requirements of article 35(1)

Provided that, an undertaking is prohibited from appointing

and registering in its Tied Insurance Intermediaries Company

Register a person which is -

(a) a person registered in the Agents Register, Managers

Register or Brokers Register under article 13;

(b) a person enrolled in the Agents List, Managers List or

Brokers List under that article;

(bb) a person enrolled in the Ancillary Insurance

Intermediaries List under article 43E;

(c) an undertaking authorised under the Insurance

Business Act to carry on business of insurance

Provided further that an undertaking is prohibited from

appointing any person acting on its behalf as a tied insurance

intermediary to carry out any tied insurance intermediaries

activities within any class or group of classes of business of

insurance as the competent authority may, from time to time, by

Insurance Distribution Rules made for the purposes of this article

determine to be a class or group of classes of business within which

no tied insurance intermediaries activities shall be carried out.

(1A) Every authorised undertaking desirous of appointing,

registering and enrolling a person to act on his or its behalf as a tied

insurance intermediary shall disclose the following information to

the competent authority

(a) where the tied insurance intermediary is a person

which is not an individual

(i) the identity of the shareholders, direct or

indirect, whether natural or legal persons, who

will have qualifying holdings in the tied

insurance intermediary and the amounts of those

holdings; and

(ii) the identity of persons who have close links with

the tied insurance intermediary; and

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(b) where the tied insurance intermediary is a person who

is an individual, the identity of persons who have close

links with the tied insurance intermediary.

(1B) Where the holdings or close links referred to in sub-article (2)

exist between the tied insurance intermediary and any other person, the

competent authority shall only grant enrolment if it considers that such

holdings or close links do not prevent it from effectively exercising its

supervisory functions.

(2) Where an authorised undertaking appoints and registers in

its Tied Insurance Intermediaries Company Register a person which

is not an individual, and that person carries out tied insurance

intermediaries activities from any one or more places of business,

that person shall ascertain that tied insurance intermediaries

activities so carried out by it from each such place of business are

carried out only by an individual who satisfies the requirements of

article 35(1).

(3) Subject to sub-articles (4) and (5), any person, other than a

person mentioned in the first proviso to sub-article (1), may seek

and obtain under this article appointment and registration in a Tied

Insurance Intermediaries Company Register of an authorised

undertaking to carry out tied insurance intermediaries activities on

behalf of such undertaking.

(4) Where a person desires to seek appointment and

registration in the Tied Insurance Intermediaries Company Register

of more than one undertaking, authorised to carry on long term

business, and where any class of long term business carried on by

the undertakings concerned is of the same kind, such person shall,

in respect of that class of business, seek and obtain appointment

and registration to carry out tied insurance intermediaries activities

relating to that kind of class of business only in the Tied Insurance

Intermediaries Company Register of one of the undertakings

concerned.

(5) Where a person desires to seek appointment and

registration in the Tied Insurance Intermediaries Company Register

of more than one undertaking authorised to carry on general

business, and where any class, or any group of classes, of general

business carried on by the undertakings concerned is of the same

kind, such person shall, in respect of that class, or that group of

classes of business, seek and obtain appointment and registration to

carry out tied insurance intermediaries activities relating to that

class, or that group of classes of business only in the Tied Insurance

Intermediaries Company Register of one of the undertakings

concerned.

(6) No person who is an employee of an authorised undertaking

shall, solely by virtue of his employment by the undertaking,

require registration in the Tied Insurance Intermediaries Company

Register of the undertaking under this article.

(6A) The competent authority shall determine an application for

enrolment under this article within three months of the submission

of a properly completed application form together with the

requisite documentation required to be submitted under this Act

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and any regulations or Insurance Distribution Rules made

thereunder. The competent authority shall notify the applicant of its

decision, without undue delay; and if it refuses to grant the

enrolment it shall inform the applicant in writing of the reasons for

the refusal

Provided that, the competent authority may take such

measures as it may deem necessary for the protection of the interest of

the public.

(7) On granting an application for enrolment under this article,

the competent authority shall issue to the applicant concerned a

certificate of enrolment evidencing enrolment of the person

registered in the Tied Insurance Intermediaries Company Register

of the applicant in the Tied Insurance Intermediaries List.

(8) Subject to the provisions of this Act, the competent

authority may subject enrolment made under this article to such

conditions as it may from time to time deem fit to impose.

(8A) The validity of the enrolment under this article shall be subject

to a regular review by the competent authority.

(9) An authorised undertaking shall at all times be responsible

for any act or omission of its registered tied insurance

intermediaries provided that such act or omission is an act or

omission pertaining to a contract of insurance issued by the

undertaking or offered on its behalf through the services of such

tied insurance intermediaries. For the purposes of this sub-article

any reference to registered tied insurance intermediaries shall

include a reference to past as well as present registered tied

insurance intermediaries.

(1) Without prejudice to sub-article (3), every tied

insurance intermediary, shall, in respect of monies held by him or it

in relation to a policy of insurance, keep such monies held by him

or it separate from his or its own monies and shall, in respect of

those monies maintain separate accounts in accordance with

requirements determined by Insurance Distribution Rules made for

the purposes of this article.

(2) No person shall have or obtain any recourse or right against

monies standing to the credit of the account referred to in sub-

article (1) in respect of a claim or right against a person acting as a

tied insurance intermediary until all proper claims arising out of

insurance distribution activities against those monies have been

satisfied, even in the event of bankruptcy of the individual or

insolvency of the company, as the case may be.

(3)

Notwithstanding the provisions of sub-articles (1) and (2)

(a) monies received by the tied insurance intermediary

from a person in relation to a contract of insurance

shall be treated as having been paid to the authorised

undertaking issuing or offering the contract, and on

whose behalf the tied insurance intermediary carries

on tied insurance intermediaries activities; and

(b) monies paid by the authorised undertaking to the tied

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insurance intermediary, and intended for the

policyholder, shall not be treated as having been paid

to the policyholder until such monies are actually

received by the policyholder concerned.

Subject to the provisions of article 40 and to the terms and

conditions of any relevant tied insurance intermediaries

appointment at any time and for any reason whatsoever -

(a) any authorised undertaking may strike off its Tied

Insurance Intermediaries Company Register the name

of any person registered in the said register;

(b) any person registered in the Tied Insurance

Intermediaries Company Register of an authorised

undertaking may make an application in writing to the

undertaking concerned requesting it to strike his or its

name off the said register.

(1) Where an authorised undertaking elects to strike the

name of a person off its Tied Insurance Intermediaries Company

Register, such undertaking shall forthwith notify in writing the

person concerned and the competent authority specifying the date

on which it elects to strike the name of that person off the register.

(2) Where an authorised undertaking strikes the name of a

person off its Tied Insurance Intermediaries Company Register on

grounds of unfitness and improperness or because the person

concerned has acted fraudulently, or dishonestly, or in such manner

as to cease to be trustworthy, the undertaking shall also notify in

writing the competent authority the reasons for so doing.

(3) On receiving a notification from an authorised undertaking

that such undertaking has elected to strike the name of a person off

its Tied Insurance Intermediaries Company Register, the competent

authority shall -

(a) if the striking of such name off the register is on

grounds other than those specified in sub-article (2), as

early as reasonably practicable, confirm in writing to

the authorised undertaking that the name of such

person, in so far as it relates to that undertaking, shall

be struck off the Tied Insurance Intermediaries List as

from the date specified in the undertaking’s

notification;

(b) if the striking of such name off the register is on

grounds specified in sub-article (2), before striking the

name of such person off the Tied Insurance

Intermediaries List, forthwith, give the person

concerned notice in writing setting out the reasons for

so doing and the provisions of article 17(2) and (3)

shall mutatis mutandis apply to a notice given under

this article.

(4) Without prejudice to any action which the competent

authority may deem appropriate under this Act or any other law,

where the competent authority strikes the name of a person off the

Tied Insurance Intermediaries List on the grounds specified in sub-

article (2), the competent authority shall give publicity to the striking

INSURANCE DISTRIBUTION

of that name off the Tied Insurance Intermediaries List and -

(a) if the name of that person is registered in the Tied

Insurance Intermediaries Company Register of any

other authorised undertaking, the competent authority

shall also forthwith notify in writing that other

undertaking and direct it to strike forthwith the name

of that person off the Tied Insurance Intermediaries

Company Register of that undertaking and give the

undertaking the reasons for its direction;

(b) the provisions of article 53A shall apply.

(5) The competent authority shall have power to order that all

expenses incurred by the publication of a notice pursuant to this

article, or such part thereof as it may deem appropriate, shall be

paid by the person concerned; and any sum so due shall be

recoverable by the competent authority in the same manner as an

administrative penalty imposed under this Act.

(6) Where an authorised undertaking receives in writing an

application from a person registered in the Tied Insurance

Intermediaries Company Register of the undertaking requesting

such undertaking to strike the name of that person off the said

register, the undertaking shall without undue delay strike the name

of that person off the said register and notify in writing the person

concerned and the competent authority specifying the date on

which it elects to strike the name of that person off the register.

(7) Where, on an application made to an authorised

undertaking under sub-article (6), the undertaking refuses, or

unduly prolongs the process, to strike the name of a person off its

Tied Insurance Intermediaries Company Register, the person

concerned may refer the matter to the competent authority and the

competent authority shall issue in writing to the undertaking

concerned those directives it deems necessary to oblige the

undertaking to hasten the process to strike the name of that person

off its register.

(8) On notification by the competent authority to an authorised

undertaking that the name of a person registered in the Tied

Insurance Intermediaries Company Register of the undertaking has

been struck off the Tied Insurance Intermediaries List, the

undertaking concerned shall forthwith surrender to the competent

authority the certificate of enrolment relating to that person, and

any official copies thereof.

(1) Notwithstanding any provision of this Act, the

competent authority may, at any time

(a) on grounds of unfitness and improperness or of

protection of the public interest

(i) refuse to enrol a person in the Tied Insurance

Intermediaries List;

(ii) strike the name of a person off the Tied

Insurance Intermediaries List;

(b) strike the name of a person off the Tied Insurance

INSURANCE DISTRIBUTION

Intermediaries List, where the tied insurance

intermediary

(i) fails to comply with the conduct of business

requirements in relation to an insurance-based

investment product or in relation to any insurance

product other than an insurance-based investment

product, set out in Conduct of Business Rules; or

(ii) ceases to fulfil any of the requirements laid

down in articles 35(1), 35A and 38, and where

applicable, any Insurance Distribution Rules

issued under the said articles;

(c) strike the name of a person off the Tied Insurance

Intermediaries List, where it comes to the knowledge

of the competent authority that any document or

information provided pursuant to the application for

enrolment, or any information given in connection

therewith, is false, incorrect or misleading in any

material particular

Provided that, in each case, the competent authority shall

inform the undertaking concerned in writing of the reasons for so

doing.

(2) In each case the competent authority may take any other

measure as it may deem necessary to safeguard the interests of

insured, policyholders, creditors or other interested persons.

(Deleted by XXVII. 2009.38).

(1) Subject to sub-article (2), for the purposes of this Part

of this Act, "authorised undertaking" shall not include an authorised

reinsurance undertaking, a reinsurance intermediary, a European

insurance undertaking and a European reinsurance undertaking.

(2) In the case of a European insurance undertaking or an

insurance intermediary registered under Article 3 of the Insurance

Distribution Directive in a Member State or EEA State other than

Malta, seeking to appoint a person resident in Malta or having its

registered office or head office in Malta to carry out tied insurance

intermediaries activities, that undertaking or intermediary shall enrol

such person with the competent authority as may be determined by

Insurance Distribution Rules made for the purposes of this article and

the said Insurance Distribution Rules shall contain the particulars,

conditions and requirements for enrolment.

PART VIIIA

REGISTRATION AND ENROLMENT OF ANCILLARY

INSURANCE INTERMEDIARIES

INSURANCE DISTRIBUTION

(1)

Subject to sub-article (2), no person shall act as an

ancillary insurance intermediary and carry out, or attempt to carry out

in Malta ancillary insurance intermediaries activities, unless such

person is appointed, registered and enrolled in accordance with the

provisions of this Act.

(2)

This article shall not apply to an ancillary insurance

intermediary which

(a)

is exempted from enrolment under article 43E of

the Act, in terms of regulations issued under this Act;

(b)

is registered pursuant to the Insurance

Distribution Directive, in a Member State or an EEA State,

other than Malta.

(1)

Subject to the provisions of article 43J, every

authorised undertaking and enrolled insurance broker desirous of

appointing a person to act on its behalf as an ancillary insurance

intermediary shall establish and maintain a register of persons acting

as ancillary insurance intermediaries, in this Act referred to as the

"Ancillary Insurance Intermediaries Company Register", containing

the particulars as the competent authority may, from time to time, by

Insurance Distribution Rules made for the purposes of this article,

determine, of all persons who are entitled under this Act to be

registered therein.

(2)

Subject to the provisions of sub-article (1), every authorised

undertaking and enrolled insurance broker shall determine its own

procedures for appointing and registering a person as an ancillary

insurance intermediary in the Ancillary Insurance Intermediaries

Company Register.

(1)

A person shall be entitled to be registered by an

authorised undertaking or an enrolled insurance broker in the

Ancillary Insurance Intermediaries Company Register of such

undertaking or insurance broker if it is satisfied that such person

(a)

is fit and proper to carry out ancillary insurance

intermediaries activities; and

(b)

possesses appropriate knowledge and ability in

order to complete tasks and perform duties adequately, relating

to ancillary insurance intermediaries activities, as may be

determined by means of Insurance Distribution Rules issued for

the purposes of this article.

(2)

A person shall not be entitled to carry out ancillary

insurance intermediaries activities, by virtue of his registration under

article 43E unless and until he is enrolled by the competent authority

in the Ancillary Insurance Intermediaries List under that article.

INSURANCE DISTRIBUTION

(1)

The competent authority shall establish and maintain

a list of persons carrying out ancillary insurance intermediaries

activities in this Act referred to as the "Ancillary Insurance

Intermediaries List", containing such particulars as the competent

authority may, determine from time to time by Insurance Distribution

Rules made for the purposes of this article of all persons who are, or

which are, entitled under this article to be enrolled therein. The

Ancillary Insurance Intermediaries List shall be updated on a regular

basis.

(2)

It shall be the duty of an authorised undertaking and an

enrolled insurance broker to enrol with the competent authority in the

Ancillary Insurance Intermediaries List any person registered by it as

an ancillary insurance intermediary in the Ancillary Insurance

Intermediaries Company Register established and maintained by it

under article 43E.

(3)

On obtaining from the competent authority a certificate of

enrolment under article 43E, an authorised undertaking or an enrolled

insurance broker, as the case may be, shall furnish the person, in

whose name the certificate of enrolment is made out, with the

certificate or an official copy thereof, issued to the authorised

undertaking or the insurance broker by the competent authority.

(4)

Where a person enrolled as aforesaid carries out ancillary

insurance intermediaries activities from a place of business or from

any other place accessible to the public, that person shall display in a

prominent position in that place in a part thereof to which the public

has access, the certificate of enrolment or an official copy thereof

issued by the competent authority under this article.

(5)

Where the enrolled person is not an individual, the Ancillary

Insurance Intermediaries List is to specify the name of the individual

who is carrying out ancillary insurance intermediaries activities and

who satisfies the requirements of article 43C(1).

(1)

Subject to the provisions of this Act, every

authorised undertaking and enrolled insurance broker desirous of

appointing a person to act on its behalf as an ancillary insurance

intermediary shall, under this article, appoint and register in the

Ancillary Insurance Intermediaries Company Register of the

authorised undertaking or the insurance broker, as the case may be,

and enrol with the competent authority in the Ancillary Insurance

Intermediaries List, a person to act on its behalf as an ancillary

insurance intermediary and to carry out ancillary insurance

intermediaries activities, as shall be determined by means of Insurance

Distribution Rules made for the purposes of this article, and, where a

person is not an individual, such person must itself have an individual

who satisfies the requirements of article 43C(1)

Provided that, an undertaking and an enrolled insurance

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broker shall be prohibited from appointing and registering in its

Ancillary Insurance Intermediaries Company Register a person which

is

(a)

a person registered in the Agents Register,

Managers Register or Brokers Register under article 13;

(b)

a person enrolled in the Agents List, Managers

List or Brokers List under that article;

(c)

a person enrolled in

the Tied

Insurance

Intermediaries List under article 37;

(d)

an undertaking authorised under the Insurance

Business Act to carry on business of insurance.

(2)

Every authorised undertaking or enrolled insurance broker,

as the case may be, desirous of appointing, registering and enrolling a

person to act on his or its behalf as an ancillary insurance intermediary

shall disclose the following information to the competent authority

(a)

where the ancillary insurance intermediary is a

person which is not an individual

(i)

the identity of the shareholders, direct or

indirect, whether natural or legal persons, who will have

qualifying holdings in that ancillary insurance

intermediary and the amounts of those holdings; and

links with the ancillary insurance intermediary;

and

(b)

where the ancillary insurance intermediary is a

person who is an individual, the identity of persons who have

close links with the ancillary insurance intermediary.

(3)

Where the holdings or close links referred to in sub-article

(2) exist between the ancillary insurance intermediary and any other

person, the competent authority shall only grant enrolment if it

considers that such holdings or close links do not prevent it from

effectively exercising its supervisory functions.

(4)

Where an authorised undertaking or an enrolled insurance

broker, as the case may be, appoints and registers in its Ancillary

Insurance Intermediaries Company Register a person which is not an

individual, and that person carries out a ncillary insurance

intermediaries activities from any one or more places of business, that

person shall ascertain that ancillary insurance intermediaries activities

so carried out by it from each such place of business are carried out

only by an individual who satisfies the requirements of article 43C(1).

(5)

Any person, other than a person mentioned in the proviso to

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sub-article (1), may seek and obtain under this article appointment and

registration in the Ancillary Insurance Intermediaries Company

Register of an authorised undertaking or an enrolled insurance broker

to carry out ancillary insurance intermediaries activities as determined

by means of Insurance Distribution Rules on behalf of such undertaking

or insurance broker.

(6)

No person who is an employee of an authorised undertaking

or an enrolled insurance broker shall, solely by virtue of his

employment by the undertaking or insurance broker, require

registration in the Ancillary Insurance Intermediaries Company

Register of the undertaking or insurance broker under this article.

(7)

The competent authority shall determine an application for

enrolment under this article within three months of the submission of a

properly completed application form together with the requisite

documentation required to be submitted under this Act and any

regulations or Insurance Distribution Rules made thereunder. The

competent authority shall notify the applicant of its decision, without

undue delay; and if it refuses to grant the enrolment it shall inform the

applicant in writing of the reasons for the refusal

Provided that, the competent authority may take such

measures as it may deem necessary for the protection of the interest of

the public.

(8)

On granting an application for enrolment under this Act, the

competent authority shall issue to the applicant concerned a certificate

of enrolment evidencing enrolment of the person registered in the

Ancillary Insurance Intermediaries Company Register of the applicant

in the Ancillary Insurance Intermediaries List.

(9)

Subject to the provisions of this Act, the competent

authority may subject enrolment made under this article to such

conditions as it may from time to time deem fit to impose.

(10) The validity of the enrolment under this article shall be

subject to a regular review by the competent authority.

(11) An authorised undertaking and an enrolled insurance broker

shall at all times be responsible for any act or omission of its registered

ancillary insurance intermediaries provided that such act or omission

is an act or omission pertaining to a contract of insurance issued by the

undertaking or insurance broker, or offered on its behalf through the

services of such ancillary insurance intermediaries. For the purposes of

this sub-article any reference to registered ancillary insurance

intermediaries shall include a reference to past as well as present

registered ancillary insurance intermediaries.

(1)

Without prejudice to sub-article (3), every ancillary

insurance intermediary, shall, in respect of monies held by him or it in

INSURANCE DISTRIBUTION

relation to a policy of insurance, keep such monies held by him or it

separate from his or its own monies and shall, in respect of those

monies maintain separate accounts in accordance with requirements

determined by Insurance Distribution Rules made for the purposes of

this article.

(2)

No person shall have or obtain any recourse or right against

monies standing to the credit of the account referred to in sub-article

(1) in respect of a claim or right against a person acting as an ancillary

insurance intermediary until all proper claims arising out of insurance

distribution activities against those monies have been satisfied, even in

the event of bankruptcy of the individual or insolvency of the

company, as the case may be.

(3)

Notwithstanding the provisions of sub-articles (1) and (2)

(a)

monies received by the ancillary insurance

intermediary from a person in relation to a contract of insurance

shall be treated as having been paid to the authorised

undertaking or the enrolled insurance broker issuing or offering

the contract, and on whose behalf the ancillary insurance

intermediary carries on ancillary insurance intermediaries

activities; and

(b)

monies paid by the authorised undertaking or the

enrolled insurance broker to the ancillary insurance

intermediary, and intended for the policyholder, shall not be

treated as having been paid to the policyholder until such

monies are actually received by the policyholder concerned.

Subject to the provisions of article 43H and to the terms and

conditions of any relevant ancillary insurance intermediaries

appointment at any time and for any reason whatsoever

(a)

any authorised undertaking and enrolled

insurance broker may strike off their Ancillary Insurance

Intermediaries Company Register the name of any person

registered in the said register;

(b)

any person registered in the Ancillary Insurance

Intermediaries Company Register of an authorised undertaking

or an enrolled insurance broker may make an application in

writing to the undertaking or insurance broker concerned, as the

case may be, requesting it to strike his or its name off the said

register.

INSURANCE DISTRIBUTION

(1)

Where an authorised undertaking or an enrolled

insurance broker elects to strike the name of a person off its Ancillary

Insurance Intermediaries Company Register, such undertaking or

insurance broker shall forthwith notify in writing the person concerned

and the competent authority specifying the date on which it elects to

strike the name of that person off the register.

(2)

Where an authorised undertaking or an enrolled insurance

broker strikes the name of a person off its Ancillary Insurance

Intermediaries Company Register on grounds of unfitness and

improperness or because the person concerned has acted fraudulently,

or dishonestly, or in such manner as to cease to be trustworthy, the

undertaking or the insurance broker shall also notify in writing the

competent authority the reasons for so doing.

(3)

On receiving a notification from an authorised undertaking

or an enrolled insurance broker that such undertaking or insurance

broker has elected to strike the name of a person off its Ancillary

Insurance Intermediaries Company Register, the competent authority

shall

(a)

if the striking of such name off the register is on

grounds other than those specified in sub-article (2), as early as

reasonably practicable, confirm in writing to the authorised

undertaking or the enrolled insurance broker that the name of

such person, in so far as it relates to that undertaking or

insurance broker, shall be struck off the Ancillary Insurance

Intermediaries List as from the date specified in the

undertaking’s or insurance broker’s notification;

(b)

if the striking of such name off the register is on

grounds specified in sub-article (2), before striking the name of

such person off the Ancillary Insurance Intermediaries List,

forthwith, give the person concerned notice in writing setting

out the reasons for so doing and the provisions of article 17(2)

and (3) shall mutatis mutandis apply to a notice given under this

article.

(4)

Without prejudice to any action which the competent

authority may deem appropriate under this Act or any other law, where

the competent authority strikes the name of a person off the Ancillary

Insurance Intermediaries List on the grounds specified in sub-article

(2), the competent authority shall give publicity to the striking of that

name off the Ancillary Insurance Intermediaries List, and

(a)

if the name of that person is registered in the

Ancillary Insurance Intermediaries Company Register of any

other authorised undertaking, the competent authority shall also

forthwith notify in writing that other undertaking and direct it to

strike forthwith the name of that person off the Ancillary

Insurance Intermediaries Company Register of that undertaking

INSURANCE DISTRIBUTION

and give the undertaking the reasons for its direction; and

(b)

the provisions of article 53A shall apply.

(5)

The competent authority shall have power to order that all

expenses incurred by the publication of a notice pursuant to this

article, or such part thereof as it may deem appropriate, shall be paid

by the person concerned; and any sum so due shall be recoverable by

the competent authority in the same manner as an administrative

penalty imposed under this Act.

(6)

Where an authorised undertaking or an enrolled insurance

broker receives in writing an application from a person registered in

the Ancillary Insurance Intermediaries Company Register of the

undertaking or insurance broker requesting such undertaking or

insurance broker to strike the name of that person off the said register,

the undertaking or the insurance broker shall without undue delay

strike the name of that person off the said register and notify in writing

the person concerned and the competent authority specifying the date

on which it elects to strike the name of that person off the register.

(7)

Where, on an application made to an authorised undertaking

or an enrolled insurance broker under sub-article (6), the undertaking

or the insurance broker, as the case may be, refuses, or unduly

prolongs the process, to strike the name of a person off its Ancillary

Insurance Intermediaries Company Register, the person concerned

may refer the matter to the competent authority and the competent

authority shall issue in writing to the undertaking or the insurance

broker concerned those directives it deems necessary to oblige the

undertaking or the insurance broker to hasten the process to strike the

name of that person off its register.

(8)

On notification by the competent authority to an authorised

undertaking or an enrolled insurance broker that the name of a person

registered in the Ancillary Insurance Intermediaries Company Register

of the undertaking or the insurance broker has been struck off the

Ancillary Insurance Intermediaries List, the undertaking or the

insurance broker concerned shall forthwith surrender to the competent

authority the certificate of enrolment relating to that person, and any

official copies thereof.

(1)

Notwithstanding any provision of this Act, the

competent authority may, at any time

(a)

on grounds of unfitness and improperness or of

protection of the public interest

(i)

refuse to enrol a person in the Ancillary

Insurance Intermediaries List;

(ii)

strike the name of a person off the

INSURANCE DISTRIBUTION

Ancillary Insurance Intermediaries List;

(b)

strike the name of a person off the Ancillary

Insurance Intermediaries List, where the ancillary insurance

intermediary

(i)

ceases to fulfil any of the requirements laid

down in articles 43C(1) and 43F, and where applicable,

any Insurance Distribution Rules issued under the said

articles; or

(ii)

fails to comply with conduct of business

requirements set out in Conduct of Business Rules;

(c)

strike the name of a person off the Ancillary

Insurance Intermediaries List, where it comes to the knowledge

of the competent authority that any document or information

provided pursuant to the application for enrolment, or any

information given in connection therewith, is false, incorrect or

misleading in any material particular

Provided that, in each case, the competent

authority shall inform the undertaking or the insurance broker

concerned in writing of the reasons for so doing.

(2)

In each case, the competent authority may take any other

measure as it may deem necessary to safeguard the interests of

insureds, policyholders, creditors or other interested persons.

(1)

Subject to sub-article (2), for the purposes of this Part

of this Act

(a)

"authorised undertaking" shall not include an

authorised reinsurance undertaking, a reinsurance intermediary,

a European insurance undertaking and a European reinsurance

undertaking;

(b)

"insurance broker" shall not include an insurance

intermediary registered under Article 3 of the Insurance

Distribution Directive in a Member State or EEA State other

than Malta.

(2)

In the case of a European insurance undertaking or an

insurance intermediary registered under Article 3 of the Insurance

Distribution Directive in a Member State or EEA State other than

Malta, seeking to appoint a person resident in Malta or having its

registered office or head office in Malta to carry out ancillary

insurance intermediaries activities, that undertaking or intermediary

shall enrol such person with the competent authority as may be

determined by Insurance Distribution Rules made for the purposes of

this article and the said Insurance Distribution Rules shall contain the

particulars, conditions and requirements for enrolment.

INSURANCE DISTRIBUTION

PART VIIIB

PROVISIONS APPLICABLE TO UNDERTAKINGS AUTHORISED

UNDER THE INSURANCE BUSINESS ACT CARRYING OUT

DISTRIBUTION ACTIVITIES

This Part shall apply to an authorised insurance undertaking

and an authorised reinsurance undertaking carrying out insurance

distribution activities and reinsurance distribution activities, as

applicable, unless otherwise specified under this Part.

(1)

Without prejudice to sub-article (2), an authorised

insurance undertaking, an authorised reinsurance undertaking, and

their employees, carrying out insurance distribution activities and

reinsurance distribution activities, as applicable, shall not be required

to be enrolled under this Act.

(2)

Notwithstanding sub-article (1), an authorised insurance

undertaking and an authorised reinsurance undertaking carrying out

insurance distribution activities and reinsurance distribution activities,

as applicable, shall, at least once a year, inform the competent

authority of the names of the individuals within the management of the

authorised insurance and reinsurance undertaking, who are responsible

for the insurance distribution activities or reinsurance distribution

activities of the authorised insurance and reinsurance undertaking, and

the competent authority may by Insurance Distribution Rules made for

the purposes of this article, determine the form, manner and content of

the information to be forwarded to it and the date by which such

information shall be forwarded to it.

(1)

An authorised insurance undertaking, an authorised

reinsurance undertaking, and their employees, carrying out insurance

distribution activities and reinsurance distribution activities, as

applicable, are required to possess appropriate knowledge and ability

in order to complete their tasks and perform their duties adequately, as

may be determined by means of Insurance Distribution Rules issued

under this article.

(2)

An authorised insurance undertaking and an authorised

reinsurance undertaking and their employees, carrying out insurance

distribution activities and reinsurance distribution activities, as

applicable, shall comply with continuing professional training and

development requirements in order to maintain an adequate level of

performance corresponding to the role they perform and the relevant

market, as may be determined by means of Insurance Distribution

Rules and, or Conduct of Business Rules issued under this article.

An authorised insurance undertaking and an authorised

reinsurance undertaking carrying out insurance distribution activities

and reinsurance distribution activities, as applicable, shall submit to

the competent authority any information which is necessary for the

purposes of supervision, as may be specified by means of regulations,

INSURANCE DISTRIBUTION

Insurance Distribution Rules or Conduct of Business Rules, which

may also specify the period within which this information is to be

An authorised insurance undertaking carrying out insurance

distribution activities shall be required to comply with conduct of

business requirements, including requirements relating to insurance-

based investment products, as may be determined by means of

Conduct of Business Rules issued for the purposes of this article.

PART IX

GENERAL PROVISIONS

(1) Every person registered or enrolled under this Act,

shall notify in writing the competent authority of any material

changes in the documentation provided or required to be provided

by or under this Act and any regulations, Insurance Distribution

Rules and Conduct of Business Rules made thereunder, as soon as the

registered or enrolled person becomes aware of such changes.

(2) Without prejudice to article 44A, a person enrolled as a

local company under this Act shall -

(a) before making any addition or alteration to the

memorandum or articles of association or other

instrument constituting the company, submit in writing

to the competent authority particulars of the proposed

addition or alteration for its prior consent; and no such

addition or alteration shall be made or shall be

registered, or shall take effect, whether it is registered

or not, unless and until the competent authority has

signified its consent in writing; and

(b) inform the competent authority of the names of the

persons holding a qualifying shareholding in the

company and the percentage of such holdings; and the

competent authority may, by Insurance Distribution

Rules made for the purposes of this article, determine

the form, manner and content of the information to be

forwarded to it and the date by which such information

shall be forwarded shall also be established by the said

Insurance Distribution Rules.

(3) (3)Without prejudice to the foregoing provisions of this

(a) a person enrolled under Part III shall notify the

competent authority on a continuous basis, without

undue delay, with any change or circumstance which

may give rise to the existence of close links within the

meaning of article 10;

(b) a tied insurance intermediary enrolled under Part VIII

shall notify any authorised undertaking appointing it,

on a continuous basis, without undue delay, with any

change in the information provided in article 37(1A);

(c) an ancillary insurance intermediary enrolled under

INSURANCE DISTRIBUTION

Part VIIIA shall notify any authorised undertaking or

any enrolled insurance broker appointing it, on a

continuous basis, without undue delay, with any

change in the information provided in article 43E(2);

and

(d) an authorised undertaking appointing, registering and

enrolling a tied insurance intermediary or an ancillary

insurance intermediary under Part VIII and Part VIIIA,

respectively, and an enrolled insurance broker

appointing, registering and enrolling an ancillary

insurance intermediary under Part VIIIA, shall notify

the competent authority on a continuous basis, without

undue delay, with any change in the information

provided in articles 37(1A) and 43E(2), respectively,

as notified by the tied insurance intermediary or

ancillary insurance intermediary concerned.

(1) Notwithstanding anything contained in any other law,

the prior written consent of the competent authority shall be

required before any person may lawfully

(a) acquire, directly or indirectly, a qualifying

shareholding in a company enrolled under article 13

(hereinafter referred to in this Act as the "enrolled

company");

(b) increase, directly or indirectly, an existing holding

which is not a qualifying shareholding so as to cause it

to become a qualifying shareholding in an enrolled

company;

(c) further increase, directly or indirectly, a qualifying

shareholding so as to cause it to equal or exceed,

twenty per centum or thirty per centum or fifty per

centum or to cause the enrolled company to become

that person’s subsidiary;

(d) reduce, directly or indirectly, a qualifying

shareholding so as to cause it to fall below fifty per

centum or thirty per centum or twenty per centum or to

cause the enrolled company to cease to be that

person’s subsidiary;

(e) reduce, directly or indirectly, a qualifying

shareholding so as to cause it to cease to be a

qualifying shareholding; or

(f) divest itself, directly or indirectly, of a qualifying

shareholding.

(2) Sub-article (1) shall apply irrespective of whether or not

any of the relevant shares are shares listed on any regulated market.

(3) It shall be the duty of an enrolled company and of the

directors thereof to notify the competent authority forthwith upon

becoming aware that any person intends to take any of the actions

set out in sub-article (1).

(4) Notwithstanding anything contained in any other law, the

written consent of the competent authority shall be required before

INSURANCE DISTRIBUTION

any company enrolled under article 13 may lawfully -

(a) merge with any other company, whether enrolled under

this Act or not;

(b) undergo any reconstruction or division; or

(c) increase or reduce its nominal or issued share capital

or effect any material change in voting rights.

(5) It shall be the duty of all directors and qualifying

shareholders of an enrolled company to notify the competent

authority forthwith upon becoming aware that the company intends

to take any of the actions set out in sub-article (4).

(6) For the purpose of this article, the competent authority may

issue Insurance Distribution Rules determining the form in which

notification in terms of sub-article (1) and sub-article (4) shall take

place and the information required to be furnished with such

notification; and the competent authority shall, upon a notification

by a person intending to take any action set out in sub-article (1)(a)

to (c), determine whether such person is a fit and proper person

before giving its consent.

(7) Within three months of receipt of such notification or

receipt of such information as the competent authority may

lawfully require, whichever be the later, the competent authority

shall issue a notice -

(a) granting unconditional consent to the taking of the

action;

(b) granting consent to the taking of the action subject to

such conditions as the competent authority may deem

appropriate; or

(c) refusing consent to the taking of the action,

and if it refuses to grant consent, it shall inform the person or the

enrolled company concerned in writing of the reason for such

refusal.

(8) If any person or any enrolled company takes or intends to

take any action set out in sub-article (1) or (4) without the prior

written consent of the competent authority, the competent authority

shall, without prejudice to any other penalty which may be imposed

under this Act, have the power to make an order

(a) restraining the person or company from taking, or

continuing with, such action;

(b) declaring such action to be void and of no effect;

(c) requiring the person or company to take such steps as

may be necessary to restore the position existing

immediately before such action was taken;

(d) restraining the person or company from exercising any

rights which such action would, if lawful, have

conferred upon them, including the right to receive any

payment or to exercise any voting rights attaching to

the shares acquired;

(e) restraining the person or company from taking any

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similar action or any other action within the categories

set out in sub-articles (1) and (4).

(9) In the case of a foreign company enrolled under this Act to

carry out insurance distribution activities or reinsurance distribution

activities in or from Malta, the provisions of this article shall apply

only to the extent of requiring such company to give to the

competent authority, not later than thirty days from such change or

occurrence, as the case may be, the information therein referred to.

(10) Without prejudice to any other provision of this Act, where

the influence exercised by any person holding a qualifying

shareholding is, or is likely to, operate against the sound and

prudent management of an enrolled company, the competent

authority may exercise any of its powers under this Act, including

the power to issue directives as it may deem reasonable in the

circumstances.

Without prejudice to the requirements of this Act, every

insurance agent and insurance broker enrolled under this Act shall

utilise the services of intermediaries which are

(a)

enrolled under Parts VIII and VIIIA, as set out in

the said Parts; or

(b)

registered under Article 3 of the Insurance

Distribution Directive or falling under Article 1(3) of the

Insurance Distribution Directive.

(1) The competent authority may exercise the following

powers at the request of or for the purposes of assisting an overseas

regulatory authority -

(a) the power to impose, revoke or vary conditions on the

grant of a registration or enrolment pursuant to the

provisions of article 13(4);

(b) the power to suspend or strike off the name of a

registered person from the Agents Register, Managers

Register or Brokers Register or of an enrolled person

from the Agents List, Managers List or Brokers List

under article 16;

(bb) the power to impose, revoke or vary conditions on the

grant of an enrolment pursuant to the provisions of

articles 37(8) and 43E(9);

(c) the power to strike off the name of a tied insurance

intermediary off the Tied Insurance Intermediaries List

enrolled under article 41;

(cc) the power to strike off the name of an ancillary insurance

intermediary off the Ancillary Insurance Intermediaries

List enrolled under article 43E;

(d) the power to take any action under articles 29, 30, 31

or 31A of the Insurance Business Act, as applicable in

accordance with article 54 of this Act;

(e) the power to communicate to the overseas regulatory

INSURANCE DISTRIBUTION

authority information in its possession, whether such

information is the result of any of the above powers or

otherwise.

(2) The competent authority shall exercise powers by virtue of

this article

(a) where the assistance is requested by the overseas

regulatory authority for the purposes of the exercise of

one or more of its regulatory functions; or

(b) where so required within the terms of Malta’s

international commitments or the obligations arising out

of the Insurance Distribution Directive, as amended from

time to time, and includes any implementing measures

that have been or may be issued thereunder, and in

particular, the competent authority shall, notwithstanding

the provisions of article 46 of this Act and article 59 of

the Insurance Business Act, as applicable, cooperate and

exchange information on insurance and reinsurance

intermediaries, ancillary insurance intermediaries and

insurance and reinsurance undertakings, with overseas

regulatory authorities, for the purpose of ensuring the

proper application of the Insurance Distribution

Directive, pursuant to Article 13 of the said Directive; or

(c) where so required within the terms of undertakings

assumed in bilateral or multilateral agreements for the

exchange of information and other forms of

collaboration with overseas regulatory authorities

including a request under a memorandum of

understanding concluded with the competent authority.

(3) There shall be meetings held between an authorised

undertaking, an insurance intermediary, an approved auditor and

the competent authority on a bilateral or a multilateral basis as

circumstances may warrant. Such meetings may be called by any of

the parties and shall in each case be chaired by the competent

(4) The competent authority shall inform the European

Commission of any general difficulties which persons enrolled under

this Act encounter in establishing themselves or carrying out insurance

distribution activities and reinsurance distribution activities in any

third country.

(1) Nothing in this Act shall authorise the competent

authority to enquire or cause an enquiry to be made in relation to an

enrolled person into the affairs of any individual client of the

enrolled person except for the purpose of ensuring compliance with

any of the provisions of this Act or any other Act.

(2) Information obtained by the competent authority or by its

officers, employees or agents, including former officers, employees

or agents, as well as by inspectors, auditors and experts acting on

behalf of the competent authority for the purposes of, or pursuant to,

any of the provisions of this Act, or of any regulations, Insurance

Distribution Rules or Conduct of Business Rules made thereunder, or

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in the discharge of any functions under any of the said provisions,

shall be treated as confidential and protected by the duty of

professional secrecy, and shall not be disclosed to any other person,

except in the following cases

(a) where the information is disclosed with a view to the

institution of, or otherwise for the purposes of,

criminal proceedings or of any proceedings by the

competent authority before any court under this Act;

(b) where the information is disclosed with a view to

enabling or assisting the competent authority in the

performance or discharge of any of its functions under

this Act;

(c) where the information has been made available to the

public by virtue of being disclosed in any

circumstances in which, or for any purpose for which,

disclosure is not precluded by this article;

(d) where a summary or collection of information is

prepared or supplied in such a way as not to enable the

identity of any person to whom the information relates

to be ascertained, without prejudice to cases covered by

criminal law;

(e) where the information is disclosed to an auditor where

such disclosure would assist the auditor in the exercise

of his functions under article 28;

(f) where the information is provided to the Central Bank

of Malta in the exercise of its functions in terms of law;

(g) where the information is provided to such other local

or overseas regulatory, judicial or enforcement

authorities where such disclosure is required or

requested for the pursuance of serious regulatory

concerns or the detection, prevention or prosecution of

criminal offences;

(h) where the information is disclosed in civil or

commercial proceedings in relation to the bankruptcy

or compulsory winding up of an insurance

intermediary provided such information does not

concern third parties involved in attempts to rescue

such insurance intermediary, and to such overseas

bodies responsible for the liquidation and bankruptcy

of a person holding an authorisation or an equivalent

licence from an overseas regulatory authority.

(3) Subject to the provisions of article 45, information obtained

from an overseas regulatory authority may only be disclosed to

another person, to another overseas regulatory authority or to any

other third party with the prior approval of the authority which had

provided the information.

(4) No person, including past and present officers or agents of

an enrolled person, shall disclose any information relating to the

affairs of an enrolled person or of a client of the enrolled person

concerned which he has acquired in the performance of his duties

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or the exercise of his functions under this Act except -

(a) when authorised to do so under any of the provisions

of this Act;

(b) for the purpose of the performance of his duties or the

exercise of his functions;

(c) when lawfully required to do so by any court or under

a provision of any law.

(5) In this article, the expression "agents", in relation to an

enrolled person, means and includes the bankers and the auditor of

the enrolled person.

(6) When an officer or an employee of an enrolled company, or a

person registered or enrolled, or an officer or an employee of such

person, has reason to believe that an activity or proposed activity could

involve money laundering, he shall act in compliance with the

reporting and other obligations set out in the regulations made under

article 12 of the Prevention of Money Laundering Act and any

procedures and guidance issued thereunder, and such disclosure shall

not constitute a breach of confidentiality.

(7) The competent authority, when processing personal data for

the purposes of the Act and any regulations, Insurance Distribution

Rules and Conduct of Business Rules issued thereunder, shall do so in

accordance with Regulation (EU) 2016/679 of the European

Parliament and of the Council of 27 April 2016 on the protection of

natural persons with regard to the processing of personal data and on

the free movement of such data, and repealing Directive 95/46/EC

(General Data Protection Regulation), as amended from time to time.

(1) The competent authority shall cooperate with EIOPA

for the purposes of the Insurance Distribution Directive, in

accordance with Regulation (EU) No. 1094/2010.

(2) The competent authority shall provide EIOPA with all

information necessary to carry out its duties in accordance with

Regulation (EU) No. 1094/2010.

Any Registers or Lists which are required to be maintained by

the competent authority in terms of this Act shall be accessible to the

public, free of charge, at the offices of the competent authority at

all times during the normal working hours of the competent

authority.

(1) Subject to the following provisions of this article, save

with the written permission of the competent authority, no person

other than -

(a) a person registered in the Agents Register, Managers

Register or Brokers Register under article 13; or

(b) a person enrolled in the Agents List, Managers List or

Brokers List under that article; or

(c) a person enrolled in the Tied Insurance Intermediaries

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List under article 37; or

(cc) a person enrolled in the Ancillary Insurance

Intermediaries List under article 43E; or

(d) an insurance and reinsurance undertaking authorised

under the Insurance Business Act; or

(e) a person who holds insurance qualifications of an

institute of repute recognised for such purpose by the

competent authority; or

(f) an institute of repute which provides instruction in

insurance business studies and is recognised as such

by the competent authority; or

(g) a person prescribed by regulations under this Act,

shall use the word "insurance" as part of his or its description or

title or make any such use on any letter paper, in any notice or

advertisement, or in any other similar manner.

(2) Any foreign company enrolled or any third country

insurance undertaking or third country reinsurance undertaking

authorised as aforesaid may use the name used in its country of

registration, incorporation or constitution save that, where there is

a risk that the use of such name may be misleading, such foreign

company, third country insurance undertaking or third country

reinsurance undertaking shall add such explanatory particulars to

its name as the competent authority shall direct.

(3) The competent authority may, by Insurance Distribution

Rules made for the purpose of this article, determine the

qualifications or experience for carrying out insurance distribution

activities and reinsurance distribution activities which are required of

persons, other than persons referred to in the foregoing sub-articles

of this article, who, on application to the competent authority, may

be permitted under this article to use the word "insurance" as part

of their description or title.

(4) For the purposes of this article, the expression "insurance"

includes reinsurance, assurance and reassurance and any of their

derivatives or other words as may indicate or purport to indicate the

carrying on of business of insurance or the carrying out of insurance

distribution activities or reinsurance distribution activities or the

carrying on of such business or the carrying out of such activities in

any language in the description or title under which a person is

carrying on such business or carrying out such activities.

A notice or other document to be given or served under this

Act and any regulations or Insurance Distribution Rules or Conduct of

Business Rules made thereunder shall be deemed to have been duly

given or served on a person if -

(a) it has been delivered to him; or

(b) it has been left at the address furnished by him to the

competent authority, or at his last known address; or

(c) it has been sent to him by post or by telefax at any of

the aforesaid addresses; or

INSURANCE DISTRIBUTION

(d) in the case of a commercial partnership registered in

Malta, it has been delivered, sent by post or by telefax,

or left at the registered office, or at the last known

registered office, of that commercial partnership; or

(e) in the case of any other body of persons, whether

corporate or unincorporate, it has been given or served

in any of the manners aforesaid to or on a director, an

officer, secretary, a clerk or the representative of that

body.

50.(1)(a) For the purposes of any appeal made to the Tribunal

under this Act, the provisions of the proviso to article

57(1) of the Insurance Business Act shall apply.

(b) For the purposes of any such appeal, the provisions of

article 21 of the Malta Financial Services Authority

Act shall also apply.

(2) Subject to the provisions of this article, an appeal shall lie

to the Financial Services Tribunal with respect to -

(a) any refusal to register or to enrol an applicant under

article 13, 41 or 43I;

(b) any condition imposed on, or subsequent to,

registration and enrolment under article 13, 37 or 43E;

(c) any suspension or striking off of the name of a person

from the Agents Register, Managers Register or

Brokers Register or the name of an enrolled person off

the Agents List, Managers List or Brokers List under

article 16;

(d) any refusal to restore the name of a person to the

Agents Register, Managers Register or Brokers

Register or the name of an enrolled person to the

Agents List, Managers List or Brokers List under

article 18(2);

(e) any one or more measures taken under article 19;

(f) any refusal to register an underwriting agreement

under article 32;

(g) any striking off of the name of a person from the Tied

Insurance Intermediaries List under article 40(3)(b);

(h) any requirement on an authorised undertaking to strike

the name of a person off the Tied Insurance

Intermediaries Company Register under article 41;

(ha) any striking off of the name of a person from the

Ancillary Insurance Intermediaries List under

article 43H(3)(b);

(hb) any requirement on an authorised undertaking or

an enrolled insurance broker to strike the name

of a person off the Ancillary Insurance

Intermediaries Company Register under article

43I;

(i) any notice issued or any order made under article 44A;

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(j)

any directive given under article 31A of the Insurance

Business Act, made applicable by article 54 of this

Act;

(k) any administrative penalty imposed in respect of

infringements as may be prescribed under article 3.

(3) The Financial Services Tribunal shall have exclusive

competence to hear appeals on the matters listed in sub-article (2).

Deleted by Act V.2020.57.

(1) Any person -

(a) who for the purpose of obtaining the registration or

enrolment unde3.3.r this Act or any regulations,

Insurance Distribution Rules or Conduct of Business

Rules made thereunder, furnishes information or

makes a statement or a declaration which the person

knows to be inaccurate, false or misleading in any

material particular, or recklessly furnishes information

or makes a statement or a declaration which is

inaccurate, false or misleading in any material

particular; or

(b) who contravenes or fails to comply with any of the

provisions of this Act as specified in regulations issued

under this article;

(c) who is knowingly a party to the carrying out of

insurance distribution activities or reinsurance

distribution activities, with a fraudulent intent or for a

fraudulent purpose; or

(d) who without any reasonable excuse alters, suppresses,

conceals, destroys or refuses to produce any document

which is lawfully required to be produced by any

person under this Act and any regulations made

thereunder; or

(e) who intentionally obstructs a person exercising rights

conferred by this Act or any regulations, Insurance

Distribution Rules or Conduct of Business Rules made

thereunder,

shall be guilty of an offence.

(2) Any person who is knowingly a party to, or procures or aids

and abets the commission of any offence under sub-article (1) shall

be guilty of an offence and shall be liable to the same penalties as

the principal offender.

(3) The Minister shall make regulations under this article

prescribing penalties for offences against this Act, and such

regulations may prescribe -

(a) penalties which are enforceable by prosecution in the

courts of Malta;

(b) different penalties for contraventions of different

INSURANCE DISTRIBUTION

provisions of this Act;

(c) penalties calculated in accordance with the duration of

the commission of the offence,

unless such penalties are otherwise imposed under article 3.

(1) The penalties prescribed by regulations made under

article 52 –

(a) in the case of imprisonment, shall not provide for a

sentence of imprisonment greater than four years;

(b) in the case of a fine imposed after a prosecution in the

courts of Malta, shall not provide for a fine (multa) of

less than two hundred thirty euro (€230) or greater than

four hundred and sixty-six thousand euro (€466,000);

(bb) may provide for both such fine and imprisonment;

(c) in the case of a continuing offence, shall not provide for

a fine (multa) of less than one hundred and sixteen euro

(€116) or greater than two hundred thirty euro (€230) for

each day during which the offence continues.

(2) No proceedings for an offence under this Act or any

regulations made thereunder other than an infringement to which

article 3(2)(h) applies, shall be commenced without the consent of

the Attorney General.

(3) The provisions of this Act shall not affect any criminal

proceedings that may be competent under any other law.

(1)

The competent authority shall publish on its official

website, without undue delay, any administrative penalty or other

measure which is imposed for breaches of the provisions of this Act

and of any regulations, Insurance Distribution Rules or Conduct of

Business Rules issued thereunder. Such publication shall include

information on the type and nature of the breach and the identity of the

natural or legal person responsible for the breach

Provided that, in cases where an appeal has been filed by the

person on whom such administrative penalty or other measure has

been imposed, the competent authority shall, without undue delay,

publish on its official website such information and any subsequent

information on the status of the appeal and the outcome thereof. The

competent authority shall also publish any decision annulling a

previous decision to impose a sanction or other measure which has

been published

Provided further that where the competent authority has

made a public statement in terms of this sub-article, it shall

simultaneously report that fact to EIOPA.

(2)

Notwithstanding sub-article (1), the competent authority

may decide to defer publication, not to publish, or to publish on an

anonymous basis, any administrative penalty or other measure

imposed, in any of the following circumstances

INSURANCE DISTRIBUTION

(a)

where the publication of the identity of legal

persons, or the identity or personal data of natural persons, is

considered by the competent authority to be disproportionate

following a case-by-case assessment conducted on the

proportionality of the publication of such data;

(b)

where the publication jeopardises the stability of

financial markets or an ongoing investigation.

(3)

The competent authority shall, in terms of Article 36 of the

Insurance Distribution Directive

(a)

inform EIOPA of all administrative penalties and

other measures imposed, but not published in accordance with

sub-article (2), including any appeal in relation thereto and the

outcome thereof;

(b)

annually provide EIOPA with aggregated

information regarding all administrative penalties and other

measures imposed in accordance with the Act and any

regulations, Insurance Distribution Rules and Conduct of

Business Rules issued thereunder, implementing the Insurance

Distribution Directive.

(1) Subject to the provisions of sub-article (2) -

(a) the provisions of articles 29 to 31A of the Insurance

Business Act (hereinafter in this article referred to as

"the Act") shall apply to an enrolled person, as if

reference in such provisions -

(i) to "authorisation" were a reference to

"enrolment in the Agents List, Managers List or

Brokers List";

(ii) to "authorised insurance or reinsurance

undertaking" were a reference to an "enrolled

person";

(iii) to "business of insurance" were a reference to

"insurance distribution activities or reinsurance

distribution activities";

(b) articles 29 to 31A of the Act shall apply to a person

enrolled in the Tied Insurance Intermediaries List or

Ancillary Insurance Intermediaries List, as if reference in

such provisions -

(i) to "authorisation" were a reference to "enrolment

in the Tied Insurance Intermediaries List" or

"enrolment

in

the

Ancillary

Insurance

Intermediaries List", as applicable";

(ii) to "an authorised insurance undertaking" were a

reference to "a reference to "a tied insurance

intermediary" or "an ancillary insurance

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intermediary";

(iii) to "business of insurance" were a reference to

"tied insurance intermediaries activities" or

"ancillary insurance intermediaries activities".

(2) Sub-article (1) shall apply to an enrolled person as if

reference in the relevant provisions of the Act to "the competent

authority" were a reference to "the competent authority" under this

Act, and "references to "Insurance Rules" were references to

"Insurance Distribution Rules".

(1) Every licence issued or other action whatever taken or

commenced under the Insurance Business Act, in so far as

insurance agents and insurance managers are concerned, or under

the Insurance Brokers and Other Intermediaries Act * , shall

continue in force and to be valid as if such licence were issued or as

if such other action were taken or commenced under this Act.

(2) Any person or company licensed under the Insurance

Business Act to act as an insurance agent or as an insurance

manager within the meaning of that Act or licensed under the

Insurance Brokers and Other Intermediaries Act* to act as an

insurance broker or insurance sub-agent within the meaning of that

latter Act shall, not later than the appointed date, conform with the

provisions of this Act or otherwise cease to act as an insurance

intermediary, and shall until the appointed date or until it conforms

with the provisions of this Act, whichever is earlier, continue to be

governed by the provisions of the Insurance Business Act or the

Insurance Brokers and Other Intermediaries Act † , as the case may

be. For the purpose of this sub-article "appointed date" means a day

being six months after the date of the coming into force of this Act.

(3) Where a company ceases to act as an insurance agent,

insurance manager or insurance broker on the grounds that such

company did not, on the appointed date, conform with the

provisions of this Act, that company shall be deemed to have made

an application to the competent authority under article 26 on the

appointed date to cease to carry on insurance intermediaries

activities on that date and to have been given permission by the

competent authority under that article on the appointed date to

cease to carry on such business on that date and to run-off that

business as from that date. The competent authority may impose

such conditions with regard to the run-off of that business as it may

deem proper.

(4) Where a person concerned ceases to act as a registered

insurance broker on the grounds that such person did not, on the

appointed date, conform with the provisions of this Act -

(a) that person shall be deemed to have made a request to

the competent authority under article 16(e) on the

appointed date requesting the competent authority to

strike his name off the said register on that date;

(b) the competent authority shall be deemed to have struck

*Repealed by this Act.

†Repealed by this Act.

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the name of that person off the Brokers Register on

that date, and, also on that date, notified that person

that his name has been struck off the Brokers Register;

and the person, following the appointed date, shall

forthwith surrender to the competent authority the

certificate of registration, and any official copies

thereof.

(5) Where a person ceases to act as an insurance sub-agent on

the grounds that such person did not, on the appointed date,

conform with the provisions of this Act -

(a) that person shall be deemed to have made an

application to the authorised company, in whose Tied

Insurance Intermediaries Company Register of the

company his name is registered, under article 39(b), on

the appointed date, requesting the company to strike

his name off the said register on that date;

(b) the authorised company concerned shall be deemed to

have struck the name of that person off the Tied

Insurance Intermediaries Register of the company on

that date, and, also on that date, notified that person

and the competent authority accordingly, under article

40(6);

(c) the competent authority shall be deemed to have struck

the name of that person off the Tied Insurance

Intermediaries List on that date, and, also on that date,

notified the company concerned accordingly, under

article 40(3)(a); and the authorised company

concerned shall forthwith, following the appointed

date, surrender to the competent authority the

certificate of enrolment relating to that person and any

official copies thereof.

(6) Without prejudice to the provisions of article 12 of the

Interpretation Act -

(a) all regulations, insurance directives, insurance

intermediaries directives, orders and other instruments

which were kept into force by, or made under, the

Insurance Business Act, in so far as insurance agents

and insurance managers are concerned, and the

Insurance Brokers and Other Intermediaries Act * ; and

(b) any agreements and arrangements which were made in

virtue of the Insurance Business Act, in so far as

insurance agents and insurance managers are

concerned, and the Insurance Brokers and Other

Intermediaries Act*, or made in virtue of any

regulation,

insurance

directive,

insurance

intermediaries directive, order and other instrument,

shall, if and as in force immediately before the commencement of

this article, be deemed to have been made under or in virtue of this

Act and shall continue in force and may be amended, altered,

*Repealed by this Act.

INSURANCE DISTRIBUTION

repealed or otherwise dealt with accordingly.

(7) All references in any enactment and in any instrument or

other document issued pursuant to the Insurance Business Act, in

so far as insurance agents and insurance managers are concerned,

or to the Insurance Brokers and Other Intermediaries Act*, or to

any provision thereof, shall, in so far as applicable, be read and

construed as a reference to this Act or to the corresponding

provision thereof.

(8) Any reference to an insurance intermediaries directive

issued by the competent authority in virtue of article 4(3) of the

Insurance Brokers and Other Intermediaries Act* in any licence,

notice, decision or other act made or taken by the competent

authority before the coming into force of the provisions of this Act,

and any reference in any law to an insurance intermediaries

directive shall be deemed to be a reference to Insurance

Distribution Rules.

(8A) Any reference to Insurance Distribution Rules issued by the

competent authority in virtue of article 4(4) of the Insurance

Intermediaries Act, in any licence, notice, decision or other act made

or taken by the competent authority under the Insurance

Intermediaries Act, and any reference in any law to Insurance

Distribution Rules shall be deemed to be a reference to Insurance

Distribution Rules.

(9) For the purpose of this article, "licence" includes authority

or authorisation, permit, approval, registration, enrolment and

appointment, and the word "licensed" shall be construed

accordingly.

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