195 tal-1994

L .N. I~ of I~

PRt: VENTION O~' MONEY LAUNDERING ACT. 1994

(ACf No. XIX OF 1994)

Preven tton of Monry Launderinz Rtlulations. 1994

IN ecrm5e of the powru confrrrrd by stelion 9 of the

Prrvc:ntion of Mollq' Laundrring Act. 1994, the Minister of Finance

has made the: following regulatio ns

These regulations may be cited as the Prevention of Cn.lionond

Money Laundering Regulations, 1994.

....,.,"" ......... 1.

(2) The5e regulations shall come into force on the 30 day of

-

December 1994.

19'N dwar ;I-K umm .. -rt Banhrju, I-A ll la' 1-1994

.Iwar ISliluujonijiC1 Fi nall7jarji j<-"W I_All la' 1- 1994

dwar S..,rvi".z; la' InvCSlim~n1 ;

(0.1) ir- R~i:isl nllur IIIS-S'-'tj~I ftj icl li jklln jagixxi skond

193 la ' I-OrdillaD7.1 dwar ~jclljicl

I -~rljko lu

KUllllllcrtjali ;

KOmJ1'Cl ~nti skond

(e) I· AWloril.

I·An dwar I- Impri:l:i

Ift' I·Assigurlz.l'joni

(f) spc1lur

mlll lur skond l·ar1ikol u 15 la ' I·AI1 dWlr

il-Kummcrt Bankarj u

U:) persun l mlll lun skond I·lrlikolu 15 jcw I.artikolu

1610' I-An 10'1· 1994 dwor il- Kummcrt Blnkarju ;

(h) pers un a mKlllllra skulHJ l-arlik"l u 14 jcw I-.n iko lu

I' 11' I-A n la' 1-1994 dWlr Istil uoJODiji cI

l'inlDzJllji;

(i) persu na mfth lUra lalll 1.8rtikolll 13 jcw I·artikolu 14

la' I_A n 1.'1. 1994 dWIr SCf'YizJ;i 11' IDvCllli mcnt;

(j) uditllf, fil - kun~~lIl " ' I' Mlik olu 14 1 Ift ' l-OrdinallzM

Kumm~"1"tj. l i,

dW" f Sotjc' Hjicl

m"IIIUr min n

kump~nnij. li Imcxxi k\lmm~rt linanzjuju rilcvanli

"

(k ) il -B"Oa IH ' Moll. rd.lti~HI11Cnl ghal pcl'Sun. li

jk"lIb. litentj. ~.I;d. I.' , .. ,,,dhroJrcr 1.111 I-All

dw., ;1-11,,,,," la' ~h l l.,

"KH) I" (Deg",;"' i) llisser kull h I' fej n in -IIcgot;al; JSIIlI .... j ll

il -pulij;,,:1 hil-ghHn li rigi O"urn"". f" llujull i kIImOlcrcj.li

hc;n;clllom

hl1 kill' ("j ll. ghMf-Il gwud IH'

"K.)2'

(su.' pclti) llisse l

kw.llInkw" IfHII"".7i"";, pc!"" na li Ikon 'l~'" ' ;'ralla 1- 1 1."~.t/i"'"

Iklln 1.1' ;~'W ,k"l1ho ~II S l'cll Ii l_appl ik MlIl ghll l kllmm~'I<"

ik un "~'" jaghmd """": .. /H"",lering, jew li 1_I" "_'Mni,,"i Ik '''' 'le ....

i"i, Ch. I PC!"''''' " hfll li Iklln "ed I.gh md """'.:. /~,,,,J'YIII.f!'-

"Ka) I" (lfl",~.ni"n . kh i •• sing" IM ) Ilis.<e. kldl b )

I;"i ll.

gh. , -n gwMnl 10 ' ~w , ll1 l1k we 1I",,""o j" III , i ~\ln ;rid is;, hl a, mu",

j~w lill -"ppiik""1 gh( kU'III'h:rt IH' I '~nlm"nl IM ' I.m 5,tMIU (ham,.",

dd 1110 I\bllij.) .,'W ' ij e~'

.'jn.

(s"rj ~ I. Iran'''aHj"" ij l,'1 ~I'arl Ili.<ser 11111 kM )

"Ko) 4"

I! h.,. t; gwanl I. )cwg l,allsaH i""iii..:' j, ..... allM I _

.1,,,, iHlhe. ",ill-I' ,<l1I lil 1"''''''"0 li Ik,," 'I ~d lilralla

(0)

~ I Ir. ,,,.ol"lI1ii'" IlIi

.,-lraIlS"Hi."III,,·1 .k" ",, 'I,~I ,situ ",;II-isl,·"

,.)

pc"S"" " 11 ik ll1". la· l,isle's., ~,,"". "

<iil

tota li,

gh r-rigward

IKI-

I-a mmool

koll ba. li j kun irid jilhal1n

IransavjoolJ ICI

minD jew lill-applikaol gbal kumm<:r~ iku n lR'

Lm5,OOO (II.oleSI clef li rft Mall ij_) jew Ikllr

jl"W

(b) f;ti stadj u aktat tard ikun jid b~'f lit d ik il-p..nuDI

1; d-d ispolluJonijict l.s-subpal1lglll li (I) (i) u (ii) 11'

hawn fuq iku DII saru

"ku11lmcrt fiUlnlJarju ril'::unli" 11i.l.s<'f -

kllll k"mmelt hank-rju imm~'XX i minn persuna j ~ .....

(a)

li fdak It-tll1;CO lkun ."" lori n"ll,

iSli lUl.7j ooi

jcw mchli cga li Ikuo lwtOriU .. I., skond id-

disp,,;>iaj"nijid lR' I-An dwar il- Ku mmcrt

I IRn k~rju ;

(to) kull Rllivilft ' imm crxij a mlnn I'c'rsu DH Jew

iSlilu ujoni li f'dak iz-tmicl1 Ikun aWI"riU~IM , jcw

Ii

mcklieg.

Iku1l

sk"nd id-

ftWlurj't Jlla.

disl'M:iujn nijicl 1 ~' I-An la' 1_1994 dw" r

1~li l u7 .... jnnij id FinanJ'jarji;

i mpri ~. I~ '

.s~igllrR7""Ju ", fuq il-hajjR im mcxx ijR

minn "..,rsll n~j~"W iSlilllnjoni 11 r o.lak i).-~mi~'n Ikun

RWlUrinall, Jew mdu ictl:a li Ikun RWlOril:lKIM, sknoo.l

id-d i~ p"Jinj"n ij icl la' 1·l\n dWlr

I-I mpri ,-" 11' K_r .><Jr!,

I_A ... igu rLQj"ni ;

(d) kumnwrt la ' invcslimcnl I mm~"llx i minn p :rsUOII

j ~'W ;slil uoj"ni hil -litL'tI7ja, jL'W mcll1i cga Ii j k"l1ha

lit ~'tI7j .,

id-di >JX'~ 7.7joll;jk" I.' I-An la'

lalll

1, 1994 dwar :'kl"i7.7.i la' In"csli""'nl;

s k ~lI1~

,. ' ;n \"\;:"li m~nl kollclli ,' bi l·liCcn7j., j~'W

(c)

mchl iq;:M

jkollh

litc07jl,

sk" nd

Ii

itl _tli ' p ,~iuJ,, ",jid I"

1-1\11

I. ' 1- 1994 t1wu

SCI" iz~i la' Ill ~cslimcnl ;

ani~il~ ' i1l1111cxxija minn pCl"S un a h;s-!<lIlIlI a la'

(I) kull

l i ~clI/Ja v~l ;da I~ ' _~{(lCkh",h.,

mahruga 11111

K~I'

id-tl isp ,);uju nij id la' I-All dwar il -Bor):a I.' Malll;

'*l kull . lI ivi lR· Ii jk<>lIha x'laqSlln' ma ' kunllll c .... 1i

ja'IH ' IlIhl il-pII l'llgrafi (a) sa ( f) la' qabd dan ;

" moth. y blllnJ~"T;"Jf

Ifiss.:r l·ghcmil la' xi all li j ikk,' slilwixx i rea l

LahL I-Ail I. ' 1_1994 kunlrM

MODey L/luDderiDg, jL"W. IiI-kaJ. I, ' MIL

mlghmul xon 'ohr. milli rMllla, ikun jikioslilwiui dak ir-r~all i

kellu jsir n..iahl;

"rclluJooi kummereja li" llisscr kull amngamenl bejn 1.cv.'g

pcr!iuni jcw i1jed, li ghlll-inqas wiehl:d min nhom ik:un qed jagixxi

fil-kon t. ' k:umrn cre finanlj.rj u ril cv.nti , mel. ·

(I) I-iskop

jcw

cITeu 1.1 ' 1_lmotamenl iku n li

j ifTa61ill kon la' trallftli"i la' spissjcw ftbitwR!i bej n

il-p<:rsuni k"n~crnAli ; u

(b) I-Immonl 1011li I. ' xi

pag.m~1I 1 j<. ' . W plg.men li li

jkun se jsir rnon" xi p~rsun. lil xi persn'l.

ohra

fil . kors la ' <lak I-urlngamenl m. jkllnx

mlghrur jcw ma j1cunx j isll' jiti Ittcnll fi:!:·i:mi <. ' . 1I

li lih isir I-Imnglmenl;

"rcllnjo n; kumnlcr~j Bh slahhilil," Ilissc r rdu7joni kummcrtjlli

itfurmall minn p<..'fS un, li lkun qed UIgiXl i fil-kon

1.1 '

k:ummert finln.-j.rju ri le".n li rejn dik il-pl."fSu na Ikun Ikkwislll,

labl oI-protl:d llri minnha .dOIl _I ; sknn<.1 ;d -di sp,,~i ujonij i ~1

tar- regnl.rnen l S IR ' dAwn ir·regnllmcmi ,

prov,

sndi sfiKcnli

la' I·identill 111-pl.'f'Su n. li, rel.n ivlm~'t1t I!: h.U·form .... .7joni 11'

d ik ir-rclu7jon i 1cumfllCl'(j .li, kienel I-I pplika nl ghl kummcrt;

H,~ke'lIM

k"l1cuiv", "p.rleti p.nli" u " uni6~

la' in"",sl imenl

ghlndhnm 1 .i.~I""" lirsi. kif "'''gbli lil dlwn 1-(:Sl'n,:s.'<jonij icl

ri Spl:Ui"'lmcnl I1 _Au I. ' 1_1 994 dw.r Servil7j 11 ' In"'!>'Ilimcnl;

"lr. n~Rz;o;joni"

klll1 I.ansulinni ( inklu~ il-liuh ' a' konl u

II,-",,-'T

r.6lil.l ' 11' ~'lIrc eu,;f(idy) Mm mi nn lrln," "llj"ni IIllghmu l.

lil-k"rs 11 ' rdu7joni kummc,~jl l j slah hilil. ifli"m~la m;nn

pcTSunl li tkun '1W IKgixx i fil_k" ,.,. IM ' kummcr~ finBnljuju

li1cvAnlL

12 '

,d'",en~ ...

gha l "1. AII d w~ r

Vdlwn ir·rcgul.m"nl i kllll

il-Kurnm~rt U~ lIhrju" gh~lIdh" lif'lihclll hh.l_ r" ro:r~II~~ ghll -All

la' 1-19\14 dWMr il·Kummcre Hanhrju u ghMIf _AII dWlr il- Kummcr~

Ibnhrju, Kip. 215 sk"m.l id-d isp"~inj,,niii,,' 1a.,_sllharlik"lu IJ)

18' I" nik"lu )7 11' I-All 11' 1_1994 dw., il -Kurnmcrt IIKnkMj u

I"'",u na rnl lisl. ', til_koTS I~ ' kumm~r~

(I)

I:hd.

J,

mmcUI n"nnha, hfli,ml~ rd~z.rj"ni

finKnlj. rju

ri teva nli

kumrn ~rt.i Kli

laghmcl xi l,an~Knj"ni mM'

jcw

pI.~unl

"hr~ hli cfj ckk oJ i. il- pl."fSun~

(I ) Iftd"ll. I-pmtwu ri ~ IKhhilili '''''HUiv~ m~ 1I1 ghat <lMk

il-kummert kif gej

protcduri IB' idcnlifiklajoni skond id-

{il

d ispoliujon ij iCI IIr-rcgollDlenli Su 7 11' dawn

ir-rcgoIKm~'tl1i

(ii l

la

'.amml 11' nv:onJs ~tond

prot~-du ri

id-dispotiujonijcl IIr_ r<'go l~mCIII

9 1I

dawn i T-r~go IKmenli : U

prot~-duri

tiiil

la

rap po rii

inkT1li

skood

id-dispotizzjollijid lar-Tcgtl lal1lc'nl 10 I. dawn

iT _T~g,,1a nl~I' IL

(10) lichu l-miluT' llicrq~ mi nn ~m;~n gha l lmi ~n sa l>i~~

I - impj~gal i j kull u kooxj i IR'

i l-p n~ ~-duri

(i)

skont! id.-disptl?;i7.7jO Di las-su l>-

plrllgT.fu (Il I ~ ' din il-pll1lgn fu. u tull policy

rile"lnl; "bill IdOUI. minnbl: \l

id.-di5pt>t iuju"ij ic1 I. I-A lii a' 1_1994 kUnlr.

(ii )

"'onc,)' L~umkring, u IR ' dlwn iT- T~g" IRmeDli

"

miDI1 <i'mic'n g hallmi~D

li ppnwdi

lill -impj"g.l;

1" la IlT;g

l-i mmRl1igga r

la'

lI-ghuti ~11

ITallsRajo niji~1 lI1" ghmul. lI1il1l1, jew gb~l , xi

p~rs llna Ii lkull, jew li lidl.er li ltUlI, '-l<-d

Iftg hmd

m.IDLY fllI/mlc-rillg,

I'~rsu n~

liks~T

I~ '

li

i<l _dispt,) ;aj"nijic1

d. " iT-

rcg" tftm~n( 1kull hatjK 11 ' real 11 (~hd , mel" linsal>

halj . , mullH

iij~-.J

I.m20,OOO

liT.

nll nn

(gt"'xr'"

df

M. II'j. ) j,:w prigullerijR ghl ' micll !. ' mloux i}"je-d minn SCDlej n,

j~'W dik il-mllll. u prign nerij. flimkkn.

S.l>i~x jigi SI.hl>il;1 jetk !"--'fSuna Iku ru ha"",' " i w.hd.

mill-hligij icl IR1-pRllI gTllfu (I) IR ' d~ •• ir-n:golank:nl. il -qmli liSI.-

I~'

gw ida rile".nli m~hruga , appnWR IR JC"W

linji

~d,,"a'~

minn ~w'''ri l " ' la ' sorvcljRn/-t, I; Ikun

lal'plih ghHI <lik il -pt:r.<un": 11

n") r~jn eh<la gwida li laqa' laht d -displltil.lj"nij i ~ 1

(h)

'RS-S llhpUlI llfRrn (I) I~ ' dan il-l'a ragl1l fu ma Ikun

'R l'pl ih, kull gwidR rile"anli ob l1l mahrugR minn

kll Tp li j im:g"IK, j~'W li j i rra pprc;i'.cIl1~, xi ,<engha,

p,..re'S.~j"u i. kumm~ Tt jc'W impieg imm eui minn dik

il-pt:IliU I1I.

I'i prot~'di m ~nl i t onll.11. ~i persunll. g hal rea' t Olllr& dan

(r-f.-gnl_ment, d ik il. persuna lis'.' liddefcndi nlhh. billi turi I;

Ilcun hadel it- mi;l;uri ragoncvoli t oll1l8 u wcUqcl kun di1iJ!:cnu

xicrqa bic)l rnl IlIaHix d lk iT-rei l isir.

"impje,.l;" lfisser

(5)

I" dao ir-rcgolH mcll l,

il-kclml

impjcgati li d-dmirijict lagbbom j inktudu

I-i nlmaniggar

la'

kummcrt fi naD7jarj u rilc\laDli.

Met. real kOIl[rl d-di spot.i7.ljo nij icl ,ar_rego larm."111 J

In thesr rrgulations-

"applicant for business" means III individual. whether Ict ing IS

principal or agent . who secb to form a business relationship. or

carry out • transaction with a pnson who is acting in the: course of

relevant fi nancial business;

"business relationship" meaJU any arrangement between two or more

persons. at least one of wh ich is acti ng in the: course of relevant

financial business, where-

(a)

the purpose or effect of the arrangement is to

facilita te a frequent or habitual course of dealings

between the persons co ncerned; and

the tolal amount of lily payment or payments 10 be

(b)

made by any person to any olher in the: course oflh.at

arrangement is nol known or capable of being

ascenained at the: lime the: arrangement ill made

' Case I" (negotiations) nleanS any case where negotiations take

place between the panics with a view to the formation of a business

relationship between them

' Case 2" (suspicions) means any case where, in respect of any

transaction, any person handling the transaction knows or suspects

that the applicant for business is engaged in money lau ndering, or

tltat the transaction is carried out on beltalf of another person

engaged in money laundering;

' Case 3" (single large tranuction) means any case where, in respecl

of any tlllnSaction, payment is 10 be made by or to the applican t fur

business of Ihe amount of Lm5,OOO (five thousand Maltese !iri ) or

more;

"Case 4" (large leries of tlllnsaclions) means any ca5e where, In

respect of twO Of" more tlllnsactions+

(a)

il appears at the OUlset to a person dealing with any

of the IllInsactions that,

(i)

the transactions are carried OUI by lhe same

person and are ofa similar characler, and

(ii) IIIe lotal amou nt, ill respect of all of the

trallsactions, which is payable by or to the

applicant for business is Lm5,OOO (five thousand

Maltese tiri) or more: or

(b)

.t any later stlgc it appears to such a person that the

provisions of sub-paragraphs (a) (i) and (ii) above arc

satisfied ,

"collective investment scheme" , "participants" and ' unit s" have tile

same meani ngs as are Issigned tu these terms respeclivdy in the

Investment Services Act, 1994;

"criminal activity" has the same meaning as is assigned to the term in

the PfC\Iention o fMom:y Laundering Act, [994

"established business relaTionship' means a business rc l~lionship

formed by • person acting in the course of relevant financial bu si ness

where that penon has obtained. under procedures maintairlCd by him

in accordance with the provisions of regulation 5 of tllese

regulations, $ltisfllCtory evidence of the identity of the per.sons who,

in relation to the formation of that business relationshi p. was the

applicant for busiTlCss

"money laundering" means the doing of any act which constitutes an

offence under the Mo ney laundering Act, ]994, or in the case of an

act C()mmil1ed otherwise than in Malta. would constitute such an

offence ifdone in Malt l ;

"relevant financial bu$ineu" means-

(a)

any business of banking carried on by a person or

institution who is for the time being aut horised. or

n:quired to be auth.ori!iCd, under the provisions of the

Banking Act ;

(b)

any activity carried on by a person or institution who

is for the time being authorised, or requ ired to be

authori!iCd. under the pro~;sions of the Financi al

Institut ions Act. ]994;

li fe usurancc business carried on by a perwn or

(c)

institution who is for the time being authori sed. or

req uired to be authorised. under the provisions of the CQP.)9(j

Insu rance BusillCSs Act;

investment business camed on by a person or

(d)

institution licensed, or required to be licensed, ullder

the provisions ort he Investment Services Act, ]994;

(e)

a collective investment scherne licensed, or required

to be licensed, ullder the provisions ofthe Investment

Services Act, ]994

any activity carried on by a per5!ln pursuant to a vali d

(t)

stockbroker's licence issued under the provisions of C.34'.

the Malta Stock Exchange Act ,

(g)

any activity whi ch is associated with a business falling

wi thin paragraphs (a) to (t) alxwe;

' supervisory authority· means-

(a)

the Central Bank of Malta;

(b)

the Malta Financial Services Centre;

(c)

the Competent Authority nominated under the

Banki ng Act , 1994, the Financial Insti tutions Act,

1994 or the Investment Servic~ Act , 1994;

t~ Registrar of Panner$hips actin8 under $eClion 193

(d)

ort~ Commercial Panner$hips Ordinance;

t~

(e)

Competent

Authority

under

the

IlISUrante

Business Act ,

(f)

an inspector appointed under $eClion I S of the

Banking Act ,

B person appointed under st::tion 20 or sect ion 22 of

tile Banking Act, 1994,

(h)

a person appointed under section 14 or section IS of

tile Financial Institutions Act , 1994;

(i)

a person appointed under section 13 or section 14 of

the Investment Services Act. 1994,

(j)

an auditor. wi thi n the meani ng of section 141 of the

Commercial Partnerships Ordinance, appointed by 3

company carrying on relevant financial business, and

(k)

the Malta Stock ""change in relation to a person who

holds. valid stockbroker's licence under lhe Malta

Stock fuchaoge Act ,

"transaction" means any transaction (including the opening of an

account and a safe custody facility) Olher than a transaction carried

oot in t he course of an ClStablished business relationship formed by a

person acting in lhe course of relevant Iinancilol business

(2) In these regulations any reference 10 'the Banking Act' shall

refer to the Banking Act, 1994 and the Banking ACt . Cap 21S as

provided fOf under sub$eClion (3) of section ]7 of t~ Banking Act.

(I) No person shall, in the coorse of relevanllinancial

business carried 011 by him. form a business relationship Of carry 001

"""'")" Ioundcnna· any lransaction wilh anolher unless Ihal person

(a)

maintains Ihe fo llowing procedures e<;tablished

tn

relal ion 10 Ihal business

(i)

identification procedures in accordance with the

provisions of regulations 5 and 1 of these

regulations

(ii) record-keeping procedures in accordance wit h

the proVISions of regulation 9 of these

regulations: and

(iii) internal reponing procedures in accordance wi th

thoe provisions of regulation 10 of these

regulations

(b)

takes appropriate measures from time 10 lime for Ihe

purposes of making employees aware of

(i)

the procedures under the provision of

sub-paragraph (a) of this sub-paragraph. and any

O!h~ relc\''llm policies that are maintained by

him. arid

{iil the pro" isions of the Prevention of Money

Laundering Act. 1994. and of these regulations

'"'

(c)

provides employecs from time to time wilh training in

the recognition and hand ling of transact ions carried

OUt hy. or on behalf of. any person who is. or appears

to be. I!11gaged in money 1311ndering.

(2) Any person who comravenes the provisions of this

regulation shall be guilly of an offence and shall. on conviction. be

liable to a fine (mull") not exceeding Lm20.000 (twl!11ty thousand

Maltese liri) ()f" to imprisonment for a tenn not c~ceeding two years.

or to both such fine and imprisonment

(l) In determining whether a person Jvo..s complied with any of

the requirements (If paragraph ( I) of this regulation. a coun may

take account of

any relevant guidance issued, approved or adopted by

(a)

a supervisory authority. which applies to that person

,,'

(h)

in a case where no guidance fa!ling within the

provisions of suh-paragraph (a) of this paragraph

applies. any other relevant guidance issued by a body

which regulates, Of is repre5eflla!i ~ of, any trade,

profession. bU5i ness or employment carried on by lhal

perMIn .

(4)

In proceedings against any person for an offence against

this regulation, it shall be • defen<:e for that person 10 show that he

.n

took

reasonable 51eps and exm:i$ed all due diligence to avoid the

commission orthe offence.

(S)

In this regulation, the term "employees· means employees

whose duties include the handling ofreleVMI financial business.

Where an offence against the provisiollS of regulation J of

these regulations is comrnilled by a body or other association of

persons, be it corporate or unincorporate, evcl)' person who al the

lime of the commission of the offence wa5 • director, manager,

5e(;retary or other similar officer of such body or associ ation. or was

purponing to act in any such capacity, shall be guilty orlhll offena

unless he proves that the o ffence was commiUed without his

knowledge and that he ex~rcised all due diligence to prevent the

commis.sion of the orr~ncc_

!dalhr __ "",~

(I) Subject 10 the provisions of regulations 6 and 8 of

these regulations. identification procedures maintained by a person

shall be deemed to be in accordance with the provisions of this

regulation if in Cases I to 4 they require. as soon as it is reasonably

practicable after contact is fir~t made between that person and an

applicant for business concerning any pal tK;u lar business relationship

or transaction-

the production by lhe appl icant for busi ness of

(a)

satisfa(;tory evidence of hi s identitv; or

the tak ing of such measures specified in the

(b)

procedures as will produce such evi dence or idenTiTy

and where thaT evidence is not obtained. the

procedures shall require thaT the business in question

shall not proceed or shall proceed only in accordance

wilh any direction made by a Police o ffia:r not below

the rank of InspecTor

HoweYCl'", where to refrain in Mich manner i~

impossible or is likely TO fru STrate effons of

investigaT ing a suspected money laundering operat ion.

that business shall proceed on condition that. repon

is immediately lodged with . Police officer !lOt below

the rank of Inspector in acrordance with regulation

II of these regulations_

For the purposes of these regulations. evidellCe of identity

(2)

shall be deemed to be satisfactory if~

it is reasonably capable of establishing that the

(a)

applicant is the person he cl aims to be: and

(b)

the person who obtains the eviden<:e is satisfied, in

KCOrdancc with the established internal procedures

and policies of the business concerned, that it doe$

establish that fact

(3) In determining for the purposes of these regulations what is

reasonably practicable in relation to any panicular business

relationship or transaction. all the circumstances shall be taken into

account inc luding, in panicular'

tile nature of the business rdationship or transaction

(a)

concerned

whether it is possible (0 obtain the evidenu before

(b)

commi tments are entered into between tile panies or

before moroey is t:l(changed , and

(c)

in relation to Case J (single large transaction) or Case

4 (large series of transactions), the earliest stage at

which there arc reasonable grounds for presuming

that the total amount payable by an applicant for

business is Lm5.000 (five thousand Maltese liri) or

more.

IdalUr _ _

(I) Where an applicant would. apan from this

sub-regulation. be required under identification procedures in pi)"""'" b)'

Bcawdance with tile provisions of regulation 5 of these regui.!IIions.

-~

to prOOLlce evidence of his ident ity. but-

(3)

the circumslances arc such that a payment is to be

made by the appl icant for business: and

(b)

it is reasonable in al l the circumstances-

for the payment IQ be senl by post or by any

(i)

elet:tronic means which is effective 10 ITanJfer

funds; or

(ii) for the details of the payment 10 be sem by post,

to be given on the telephone or 10 be given by

any other electronic means;

then, s.ubjec\ to the provisions of pantgraph (3) of ,h'$ regulation, the

fact that the payment is debi ted from an accoonl held in the

a'

applicant's name

a bank within the meaning of 5Ubseclion ( I) of

section 2 of Ihe Banking Act, shall be Cllpable of cOlIStituting the

required evidence ofidenlity

(2) ~-or the purposes of sub-paragraph (b) of parasraph (I) of

th.is regulation, it shall be immaterial whether the payment or its

details are senior given to a person who is bound by the provisions

of paragraph (I) of regulation 5 of these regulations or to some

other person acling on his b!:ha.lf

(3) The provisions of paragraph (I) of this rcgulation shall not

ha~e effecllo Ihe extent that

Case 2 (suspicion ) applics to the circumstftnc~ of 100

(a)

payment; or

(b)

the payment is made by any person in the course of

openinll an account with a bank within Ihe mean;nll of

subsection (I) of section (2) of tile Bankinll Act

(I) Subject (0 the exemptions pro~ided in regulatio n 8 of

these regulat ions. the provisions of thi s rCllulation apply in relatiOf! to

a person who is bound by the provisions of pafllijraph (I) of

reijulation 3 of these rc!!-ulations where an applicant for busillt::<5 i5 or

appears to be actinij otherwise than as principal

(2) In III identification procedures maintained by a person il

shall be deemed to be in accord ance with this rCllulation if. in a case

to which the provisions of paragraph (I) orlhis regulation apply·

(a)

they require reasonable mcasures 10 be taken for the

purpose of establishing the identity (If any person on

whose behalf the applicant for business is acting in

addition tu identification of the applicant for business.

""'

they require that, where $Ych measures cannot be

(b)

taken, the businen relationship or transaetion shall

only proceed as provided for under paragraph (I) of

regulation 5 oflhese regulations.

(3) In determining, for the purposes of paragnph (2) of this

regulation. wkat consl iwtes measures in any particular cue. regard

shall be had to best practice which.. for the time being. is followed in

the relevant field of business and is applicable to the circumstances of

(4) For the purposes of paragraph (2) of this regulation. it shall

be reasonable for 11 person bound by the provisions of paragraph (I)

of regulation J of these regulations to obtain from the applicant for

business a written declaration in which he discloses satisfactory

identification of his principal

Provided Ihal-

(i)

where the principal is a body corporate,

satisfactory identificatio n shall also be disclosed

of all directors of the principal

(ii) Ihe appl icant for busillCSS is duly authorised lA

writing by the principal: and

(iiil this puagraph shall not apply ""here the

applicant for business is a ~n acting within

the terms of paragraph (5) of this regulation.

(5) Where Ihe applicant for business is an advocate, notary.

ccnified public accountant. cen ified public accountant and auditor or

nominee company established and practising in Malta, who is not

a.::ting on his own bellalf. it 5hal1 be reasonable for a ~n bound by

Ihe provisions of parlgraph (1) of regulation J of these: regul ations

10 obtain a declarat ion in wri ling from the applicant for business to

I he effect thal

(a)

the applicant for business is acting in the professional

capacity of advocale, notary, certified public

accountant , ceni fi ed public accou ntant and auditor or

oominee company on behalf of an undi sclosed

principal and has maintained a professional

relationship with the principal for the three months

immediately preceding the appli cat ion for business or

has obtained satisfactory references from .1 least IWO

persons who have maintained a professional

relationship with Ihe principlIl for the said three

months;

(b)

the powers of the applicant for business have not

been conferred principally for the sole purpose of

dealing with ptl"$(lns bound by the provisions of !<ID-

paragraph (I) of regulation 3 of lhe$e regul ations and

that the applicant knows 01'" will know the nature of

the underlying transactions for the purpose of which

he will be dealing with persons bound by the said

provisions of paragraph (I) of regulation 3;

(c)

Ihe applicant for business illS obtained satisfactory

evidence of the identity of the principal within the

meaning of paragraph (2) of regulation 5 of these

regulations aOO maintains. record of such identity or

identities in IICCOTdance with regulation 9 of the$e

~gulllions;

the applicant fOf business is nOI aware orany fact that

(d)

indicates that. or causes him to suspect thaI, the

assets or transactions involved 8re or will be derived

from criminal activity;

(e)

the applicant for bu5ines.s will inform the peuon

bound by the provisions of paragraph (I) of

regulation J of these provision$ if the powers of the

applicam for busi"css are revoked or otherwise

tenninated, or if any Statement in the wrillen

declaration should cease to be truc

(6) An appl icant for business who m~kes a false declaration for

the purposes of this regulation sllall be: guilty of an offence and shall

be: liable. on conviction. to a fine (mu/lo) not e~ceeding Lm20,OOO

(twenty thou$llnd Mallesc liri) or to imprisonment for" term not

ClIceeding twO years or to both such fine and imprisorunent

(I) Subject to the provisions of paragraph (2) of this

regulation. identification procedures under the provisions of

rcgulation55 and 7 of these regulations shall not re<juire any steps to

be: taken to obtain evidence of any person's idemity-

(a)

where there Brc reasonable grounds for belie-.ing that

the applicant for business is a person who is bound by

the provisions of paragraph (1) of regulat ion 3 of

these regulations;

(b)

where any transaction is carried out 1'o;lh a third pan)'

pursuant 10 an introduction effected by a person ;n

respect of whom there are reuonable groooos for

believing lhat he is bound by the provisions of

paragraph Cl) of regula lion 3 orlllese regulat ions. and

who provides the name orlhe third pan)' and gives an

assunmce IlIat he has obtained evidence as to the

identity of lhe third plny'

in re lation 10 life in~rance business in respect of

(c)

which a periodic premium is payable in one instalment

of an amount nol exC«ding Lm 1.000 (one thousand

Mall c~ liri); and

(d)

in rdation to life insurance business in respect of

which 11 periodic premium is plyable and wtlere the

10lal payable in rcspct:t of any calendar year does not

cxce~'() I.m500 (fIve hundred Malt ese liri),

(2) Nothing in this regulation contained shall apply in

CIrcumstanCes falling within Case 2 (suspicion)

( I) Record- ~ccping procedures maintained by a person ke«lrd-keep"'I

shall be deemed to be in accordance with t~ provisions of this prD<C<loKa.

regulation if they make provision for Ihe kccping. for the prescribed

period. of lhe follo,,·ing records-

(a)

in any case wllefe evidence of a person's identity is

obta ined under procedures maintained in accordallCe

with the provisions of regulations 5 or 7 of these

fC'Sulations. a record that indicates the nature of the

evidence and -

(i)

comprises a copy of tile evidence ofidenri ly; Of

(ii) provides such information authenticated by the

ftpplicam for business as would enable a copy o f

the evidence ofidcmity 10 be obtained: or

(i;;) in a ease where it is 1'101 reasonably practicable to

comply with items (i) or (ii) of this

sub-paragraph., provides sufficient information 10

enable t~ details as \0 • person's identity

contained in the relevant evidence 10 be

re.obtained, and

(b)

a record containing details relating to all oosiness

transacted (including any business transacted in the

course of a business relationship).

(2) For the purposes of paragraph (1) orlhis regulation, the

prescribed period shall be the period of a1 leaSI live years

commencing with-

(a)

in relllion 10 such records as are described in

paragraph (a), the dale on which the relevant business

was completed: and

(b)

in relation to such records as Irc described il'l

paragraph (b). the dale on whi<:h all dealings taking

place in the course of lhe business in question were

completed.

(3) For the purposes of sub-paragraph (a) of paragraph (2) of

this regulation the dale on which relevant business is completed shall,

as the case amy be, be deemed to be tile date of.

in circumstances falling within Case 1 (negotiations).

the ending of tile business rda\ionship in respec;t of

whose formation the ft=ord under this regulation WIS

compiled,

in circumst ances falling within Case 2 (suspicion) 01'

(b)

Case 3 (single large transaction). the ClIrrying out of

the transaction in respt(:t of which the rCOOfd under

this regulation was CQtTIpiled; and

(c)

in circumstances falling wi thin Case 4 (large series of

transactions). the carrying out of the last transaction

in respect of which the record under this regulation

was compiled ,

and where the formalities necessary 10 end a busint:ss

relationship have not bei:n observed. bul B period of fIve

years has elapsed since the date on which the las\

Iran$8ction was carried out in the course of t h~1

relationship, then tke date of that transaction shall be

treated as Ihe date on which the relevant business was

completed

(I) Internal reporting procedures maintained by a person, hllmo.al fCPO<I,nf

herein.fter rd'erred to IS the 'Subjffi Person", shall be deemed 10 be procedures.

in accordance wilh the provisions of this regulation if the)' provide

a reponing officer employed by the Subject Per$(m 10

whom a repon is to be made of any information OT

other man er which gives rise to a knowledge or

suspicion that another person is engaged in money

laundering,

(h)

consideration of such report by the reponing officer

or by Kflolher designat ed emp loyee of the Subject

Person, in the light of all ot her relevant information.

for the purpose of determming whether or not tile

information or O!her maller comained in lhe repon

does give rise 10 3 kr\Owledge or suspicion that

another person ii engaged in money laundCTing.

(c)

reasonahle access for the reponing officer or other

designated emplo}·cc 10 any information held by the

Subjecl Person which may be of assiSlar>ee for lhe

IJUrposes of considering Ihe report. n,d

(d)

a procedure" herd)\' an)' knowledge or suspidon that

another person is engaged in money laundering

del enll1ned by Ihe reporting oftieer or other

designated ~ployCC" i~ repon ed in accordance with

regulation II ofthe5e regulations

A SU~!"\ISOry authorilY shall maintain int ernal repo n ing

pTt" ... ·<·dure~ "I accordance "ith the prm1sions of paragraph (1) of this

rcgulalinl1 Ttw failure of a iupcr\"isory alllhorily 10 maintai n such

pro.:<'durc:' ill accNdance with the provisions oflhis rel!"~lalion sha ll

1101 COII='tltulc all otlCI1CC bm Ina\" be the subject of diSl:iplinarv

procecdings agRIII=,1 the otlkial~ or employces COnCC"fned

1.11 "n~· (,tlicial or cmployee of a Subjecl Person or a

.'''PCrI'!'''!"")· aUlhorit~· "ho di!ICloses 10 the person concerned or 10 J

third pUt\" tlm an ,",·cst'gauon i~ being carried O\.It tlllTSU3nt to Ihe

provisi oJl.'i orlhis regulat ion, or that information has been transmilled

to a Police officer pursuant 10 Ihis regulation or regulation L I, shall

be guilty of an offence and liable on conviction to a fine (mu/la) not

e~ceeding

Lm20,OOO (twenty thousand Maltese liri) or to

impriwnment for a term not exc«:ding two years or to bolh such

fine and imprisonment

It

Where a supervi$Ol'}' authority or any person bound by that

Kepot1...,.oI'.vul<noc

provisions of paragraph (I) of regulation 1 of these regulation s

refen-td to as the ·Subject Person" under regulation 10 of tllese

regulations-

Ca)

obtains any informatio n, and

is of tile opinioo Ihal the information indicates that

(b)

any person has or may have been ellgaged in money

laundering

that supervisory authority or person shall, as soon as is reasonably

practicable, disclose th.at information 10 a Police officer I\Ot below

tile rank of Inspector.

M ~l M IWl",i l. ' la' $tlrv~ ljRn7.11 j~w kull persun~ ohra R· pp"~·U ,,'

""'rll" 18 hi d-d is1",;ti17j"nij icl I. I.pR n gnru ( I) lar-rcgol.mcnl J IH' . ,'j,ku.o '"' I/W"'Y

d.wn ir-regolamenli nt<cjj h. bll. l. s- Subj~'C, !'l!'fIJ<m lahl 1'10"'*';"""

ir- regtllHtnel11 10 I.' dOll ir-reJllolllllC111 -

liks~h xi in rormau juni. u

(R)

(11) Ikll1l la l· fdllna Ii d ik l· infomlR7 ... j"n; Ikllll lind ikl li

xi pcrsl100 kie ncl j~'W s.:Igllel ki cnd q ~'tl IRghm d

",on<y I~,,"(k";ng,

dik l-awI" ril.· la' ... , .... ·clj.nl. j~'W persun. glla ndha, mill -.klHr lis

li jku n llIg0"~""llllCnll'nll ihhhli, lihcf dik l-illfurmanju ni lil

"nit i.1 lll _I'u li lij. li ml j kulIJI 'I hl il·grid 11' Spen ur,

Uta .. ' iofo"""'.1j ....

Any information disclosed under these regulations shall be

used only in conne<:tion with investigations of money laundering

aetivities

ff<lllllh<

Any bone, fld.! eommuniQtion or disclosure made in

accordance with paragraph (5) of regulation 7, regulation 10 or

regulation 11 of these regulations shall not be trt!atoo 15 a breach o f

the duty of professional sec;recy or any other restriction (whether

imposed by StaUlte or otherwise) upon the disclosure of information

r. ..... lory "'".".,."

Nothing in these legulations con tained shall require a

person who is bound by the provisions of paragraph (1) of regulation

J of these regulations to maintain procedures in accordance with

regulations 5 and 7 ofthcse regulations whi ch rCIluire evidem;e 10 be

obtained, in respect of any busint"$s relationship formed by him

before the dale on which these regulations eome inlO force, as to the

identity of the person with whom that relationship has been formed.

and any such relationship shall be l~aled as if it were an established

busi!M!ss relationship

-<-

_.,"" 0.,.._ .. ",,,,,,"

Il'p"'.M ... m.M);po" .... '" .. ·1-(.1 ...... i "" -r..,,iIjo

P,;"w. "" 0...""""", ~ ".. ..

W'bosII R·I""-,,io ,01-0..:...