Regulations, 2004

L.N. 228 of 2004

BANKING ACT

(CAP. 371)

Credit Institutions (Reorganisation and Winding Up)

Regulations, 2004

IN exercise of the powers conferred by article 29A of the Banking

Act, the Prime Minister and Minister of Finance, after consultation

with the Malta Financial Services Authority, as the competent authority

appointed for the purposes of that Act, has made the following

regulations>-

(1)

These regulations may be cited as the Credit Citation and

commencement.

Institutions (Reorganisation and Winding Up) Regulations, 2004.

These regulations shall come into force on the 1 st May,

(2)

2004.

(a) in Austria, undertakings recognised as housing associations in the public

interest and the “÷sterreichische Kontrollbank AG”<

(b) in Belgium, the “Institut de RÈescompte et de Garantie⁄Herdiscontering-

en Waarborginstituut”<

(c) in Denmark, the “Dansk Eksportfinansieringsfond”, the “Danmarks

Skibskreditfond”, and “Dansk Landbrugs Realkreditfond”<

(d) in Finland, the “Teollisen yhteistyön rahasto Oy⁄Fonden för industriellt

samarbete AB”, and the “Kera Oy⁄Kera Ab”<

(e)

in France, the“Caisse des dépôts et consignations”<

(f) in Germany, the “Kreditanstalt für Wiederaufbau”, undertakings which

are recognised under the “Wohnungsgemeinnützigkeitsgesetz” as bodies of State

housing policy and are not mainly engaged in banking transactions, and

undertakings recognised under that law as non-profit housing undertakings<

(g) in Greece the “ Ελληνικη Τραπεζα Βιοµηχανικης Αναπτυξεως”

(Ellinki Trapeza Viomichanikis Anaptyxeos), the“Ταµειο Παρακαταϑηκων

και ∆ανειων” (Tamio Parakatathikon kai Danion) and the “Ταχυδροµικο

Ταµιευτηριο” ( Tachidromiko Tamieftirio)<

(h) In Ireland, credit unions and the friendly societies<

(i) in Italy, the “Cassa depositi e prestiti”<

(j) in Portugal, “Caixas Económicas” existing on 1 January 1986 with the

exception of those incorporated as limited companies and of the “Caixa Económica

Montepio Geral”<

(k) in Spain, the “Instituto de Crèdito Oficial”<

(l) in Sweden, the “Svenska Skeppshypotekskassan”< and

(m) in the Netherlands, the “Netherlandse Investeringsbank voor

Ontwikkelingslanden NV”, the “NV Noordelijke Ontwikkelingsmaatschappij”, the

“NV Industriebank Limburgs Instituut voor Ontwikkeling en Financiering” and

the “Overijsselse Ontwikkelingsmaatschappij NV”.

Mitbug[ fl-Istamperija tal-Gvern — Printed at the Government Printing Press

(1) These regulations apply to Maltese credit institutions and Scope.

to branches present in Malta of European credit institutions.

(2)

The provisions of these regulations do not apply to

post office giro institutions or to the Central Bank of Malta or to any

central bank of any other Member State or EEA State.

(3)

The institutions listed in the Schedule shall not be

considered European credit institutions for the purposes of these

regulations, and the provisions of these regulations do not apply to

them.

(4) The provisions of these regulations relating specifically

to the branches of a credit institution not having a head office withibn

a Member State or an EEA State apply only where such institution has

branches in at least two States being either a Member State or and EEA

State.

PRELIMINARY

(1)

In these regulations, unless the context otherwise requires -

“the Act” means the Banking Act<

“administrator” means a special controller appointed under

the Companies Act< or a Controller appointed under the Controlled

Companies (Procedure for Liquidation) Act< or a competent person

appointed under article 29 1 (d) of the Act< or any other person or

body appointed by the competent authority or the foreign judicial

or administrative authority for the purpose of administering

reorganisation measures<

“branch” has the meaning as defined in point (3) of Article 1,

of Directive 2000⁄12⁄EC and shall mean a place of business which

forms a legally dependent part of a credit institution and which

carries out directly all or some of the transactions inherent in the

business of credit institutions, provided that any number of places

of business set up in the same Member State or EEA State by a

credit institution with headquarters in another Member State or

EEA State is regarded as a single branch<

“competent authority” means the Malta Financial Services

Authority as the national authority empowered to supervise credit

institutions by article 3(1) of the Act<

“the Court” means either the Civil Court in its contentious

jurisdiction in its role as the judicial authority competent for the

purposes of reorganisation measures or winding-up proceedings

in terms of Parts V and VI of the Companies Act or the Appeals

Board provided for by article 7 of the Controlled Companies

(Procedure for Liquidation) Act<

“creditor” shall include a depositor as defined in the Depositor

Compensation Scheme Regulations, 2003<

“credit institution” has the meaning as defined in point (1) of

Article 1 of Directive 2000⁄12⁄EC, that is an undertaking whose

business is to receive deposits or other repayable funds from the

public and to grant credits for its own account, including any private

or public undertaking which corresponds to this definition and

which has been authorised in a State not being either a Member

State or an EEA State<

“EEA State” means a State which is a contracting party to the

agreement on the European Economic Area signed at Oporto on

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

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

“European credit institution” means a credit institution having

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

“foreign administrative or judicial authorities” means the

administrative or judicial authorities competent for reorganisation

measures or winding-up proceedings in accordance with the legislation

or procedures of any Member State or EEA State other than Malta<

“foreign authority” means the body or bodies empowered to

supervise credit institutions by any Member State or EEA State other

than Malta<

“head office” means the office that serves as the administrative

centre of a credit institution responsible for the activities of overall

management of the credit institution including its branches<

“home State” means the Member State or EEA State in which

the head office of the credit institution is situated and in which the

credit institution has been authorised in accordance with Articles 4 to

11 of Directive 2000⁄12⁄EC<

“host State” means the Member State or EEA State other than

the home State in which a credit institution has a branch<

“Instruments” means all the instruments referred to in Section B

of the Annex to Directive 93⁄22⁄EEC<

“known creditors” means creditors where the administrator or

liquidator is aware of, or should reasonably be aware of >

(i) the creditor’s identity<

(ii) the creditor’s claim or potential claim, and

(iii) a recent address where the creditor is likely to receive a

communication<

“liquidator” means –

(a) in Malta, an individual liquidator or liquidation

committee appointed under the provisions of the Companies Act Cap.386.

to administer the winding up of a Maltese credit institution or its

branches and includes the official receiver as defined in the

Companies Act when acting in the capacity of liquidator and the

Controller as defined in the Controlled Companies (Procedure Cap.383.

for Liquidation) Act when acting in the capacity of liquidator<

and

(b) in another Member State or EEA State, any person or

body duly appointed in accordance with the legislation and

procedures of that State, for the purposes of administering

winding up proceedings of a European Credit institution or

its branches<

“ theMinister” shall mean the Minister responsible for

financial regulation<

“Maltese credit institution” means a credit institution whose

home State is Malta<

“Member State” means a member of the European

Communities<

“the Registrar” means the person appointed to act as the

Registrar of Companies by the Minister responsible for the registration

of commercial partnerships pursuant to article 400 of the Companies

Act<

“regulated market” shall have the same meaning as in point

(13) of Article 1 of Directive 93⁄22⁄EEC<

“reorganisation measures” means measures which in the case

of credit institutions involve the intervention of the Court under

Part VI of the Companies Act or of the foreign or judicial authorities

and which are intended to preserve or restore the financial situation

of a credit institution and which could affect third parties’ pre-

existing rights, including measures involving the possibility of a

suspension of payments, suspension of enforcement measures and

where provided for by law the reduction of claims<

“winding-up proceedings” means collective proceedings

opened upon application by a duly interested party and monitored

by the Court or by the foreign administrative or judicial authorities

of any State competent for winding-up proceedings in accordance

with the legislation or procedures of such state where the aim of

such proceedings is of realising assets under the supervision of

those authorities, including where the proceedings are terminated

by a composition or other, similar measure<

(2) Words and expressions which are also used in the

Act have the same meanings as in the Act.

PART I – REORGANISATION MEASURES

(1) The Court shall, upon receipt of an application made Adoption of

in terms of the Companies Act, or the Controlled Companies (Procedure reorganisation

measures in Malta.

for Liquidation) Act, and the Act, decide on the implementation of

reorganisation measures with respect to a Maltese credit institution

including its branches established in host States.

(2) Reorganisation measures adopted by the Court in respect

of a Maltese credit institution including its branches in any other host

State shall, unless expressly provided otherwise in these regulations,

be applied in terms of the Companies Act, the Controlled Companies Cap. 386.

(Procedure for Liquidation) Act and the Act as appropriate.

(3) Upon reorganisation measures taken pursuant to these

regulations becoming effective in Malta they shall be immediately fully

effective in any other Member State or EEA State without any further

formalities, including formalities as against third parties in any Member

State or EEA States, even if the legislation of such host State applicable

to such third parties, does not provide for such reorganisation measures,

or alternatively makes their implementation subject to conditions which

are not fulfilled.

(4) Nothing in these regulations shall prejudice the powers

of the competent authority in relation to reorganisation measures with

respect to a Maltese credit institution including its branches established

in host States, where provided for in article 29 of the Act.

(1) The Court shall, upon receipt of an application for Information for the

any reorganisation measure, inform the competent authority regarding competent

and the foreign

this request in order to obtain its views on the adoption of such measure authority of the host

State.

and the practical effects which it may have. Provided that where the

reorganisation measure involves a company recovery order in terms of

the Companies Act, the provisions of article 329B (3) (d) of the

Companies Act shall apply.

(2) Where the court makes a decision, order or appointment

of any of the following kinds> -

(a) any compromise or arrangement in terms of article 327 of

the Companies Act< or

(b) a company recovery order and appoints a special

controller in accordance with† article 329B of the Companies Act,

it must immediately inform the competent authority, or cause

the competent authority to be informed without delay, of the

decision, order or appointment which has been made.

(3) Where the competent authority is informed of a decision,

order or appointment in accordance with this regulation it shall, in turn

without delay and by any means available, inform the foreign authority,

if any, of the decision to adopt reorganisation measures including the

possible practical effects of such measures.

(4) The duties provided for in this regulation are

supplemental to and without prejudice to the duties of the Registrar of

Courts in article 329B (13) (a) – (c) of the Companies Act.

(1) Where, upon receipt of an application, the Court deems

it necessary to implement one or more re-organisation measures on a

branch present in Malta of a European credit institution, the Court shall

inform the competent authority regarding this request in order to obtain

its views on the adoption of such measure and the practical effects which

it may have> Provided that where the reorganisation measure involves

a company recovery order in terms of the Companies Act, the provisions

of article 329B (3) (d) of the Companies Act shall apply.

(2) Where the Court makes a decision, order or appointment

of any of the following kinds> -

(a) any compromise or arrangement in terms of article 327

of the Companies Act< or

(b) a company recovery order and appoints a special

controller in accordance with article 329B of the Companies Act,

it must immediately inform the competent authority, or cause

the competent authority to be informed without delay, of the decision,

order or appointment which has been made.

(3) Where the competent authority is informed of a

decision, order or appointment in accordance with this regulation it

shall, in turn without delay and by any means available, inform the

foreign authority of the decision to adopt reorganisation measures

including the possible practical effects of such measures.

(4) The duties provided for in sub-regulations (1) and (2)

above of this regulation are supplemental to and without prejudice to

the duties of the Registrar of Courts in article 329B (13) (a) – (c) of the

Companies Act.

(1) Where a decision on reorganisation measures adopted Publication

decision on

by the Court is subject to a right of redress and its implementation is reorganisation

likely to affect the rights of third parties, upon the Court’s taking such measures

interests of third

decision, the administrator or any other person appointed by the Court parties right of

in relation to such measure, shall at the earliest opportunity publish an redress.Cap. 386.

extract from the Court’s decision in>-

(a) the Malta Government Gazette<

(b) any two Maltese newspapers, provided that one extract is

published in the English language and the other is published in the

Maltese language<

(c) the Official Journal of the European Communities,

provided that third party rights in any host State are capable of

being affected by the reorganisation measures< and

(d) two national newspapers in each host State, provided that

third party rights in the host State are capable of being affected by

the reorganisation measures.

(2) The publication made pursuant to regulation 7 (1) shall at

least specify -

(a) the purpose and legal basis of the Court’s decision taken<

(b) the time limits for lodging requests for redress to the Court<

(c) a clearly understandable indication of the date of expiry

of the time limit for lodging requests for redress to the Court< and

(d) the details of Court and that it is competent to hear the

grievances of persons stipulated under the Companies Act or any

other applicable law.

(3)

The information set out in regulation 7 (1) shall be

published in English or in both English and Maltese as well as, where

applicable, in an official language of the host State in which the

information is published.

(4)

The reorganisation measures apply regardless of the

provisions concerning publication set out in regulation 7 (1) and (2)

hereof and are fully effective against creditors, unless otherwise provided

by law or by the administrative or judicial authorities.

(5) The obligation of publication provided for in this

regulation is without prejudice to the duties of the special controller as

stipulated in article 329B (7) (c) of the Companies Act.

(1) Where the Companies Act provides that creditors are

to be informed of their rights to lodge a claim or to submit observations

at a creditors meeting the administrator shall without delay inform in

writing all known creditors, including creditors who have their normal

place of residence, domicile or head office in another Member State or

EEA State, about any Court decision, order or appointment in terms of

Articles 327 or 329B of the Companies Act regarding the

commencement of reorganisation procedures as well as details regarding

the information requested in this regulation.

(2) The information given to creditors shall include at least

the following>-

(i) that re-organisation measures have commenced in

relation to a Maltese credit institution<

(ii) the applicable time limits for the re-organisation

measures, if any<

(iii) the penalties laid down in regards to any time

limits, if any<

(iv) the body or authority empowered to accept claims

or observations in relation to the measures< and

(v) as to whether creditors whose claims are

preferential or secured in rem need lodge their claims.

(3) In the case of company recovery proceedings the

information provided for above shall be supplemental to and without

prejudice to the duties of the special controller in 329 B (7) of the

Companies Act. Where the special controller is obliged to advise

creditors as to the date and venue of any creditors’ meeting to which

they may be entitled to attend sufficient notice shall be given in terms

of article 329 B (7) (b) of the Companies Act.

(4) The information set out in regulation 8 (2) (i) to (v) shall

be issued in English or in both English and Maltese.

(5) A form shall also be used bearing, in all the official

languages of the European Union, the heading “Invitation to lodge a

claim. Time limits to be observed.”

(6) (a) Creditors who have their normal place of residence,

domicile or head office in another Member State or EEA State shall

have the same right to lodge claims or submit observations in terms of

Part VI of the Companies Act as creditors with their normal place of

residence, domicile or head office in the home State in accordance with

the procedures laid down in regulation 18.

(b) A creditor shall send copies of supporting documents, if

any, and shall indicate –

(i) the nature of the claim<

(ii) the date on which it arose<

(iii) the amount of the claim<

(iv) whether the creditor alleges any preference, security

in rem or reservation of title in respect of the claim< and

(v) the assets that are covered by the creditor’s security.

(1) Where, upon receipt of an application to adopt a decision Branches of third-

on a reorganisation measure in relation to a branch present in Malta of country

institutions -

a credit institution having its head office outside a Member State or information foreign

EEA State, the Court shall inform the competent authority regarding authority

host States.

this request in order to obtain its views on the adoption of such measure

and the practical effects which it may have> Provided that where the

reorganisation measure involves a company recovery order in terms of

the Companies Act, the provisions of article 329B (3) (d) of the

Companies Act shall apply.

(2) Where the Court makes a decision, order or appointment

of any of the following kinds> -

(a)

any compromise or arrangement in terms of article Cap. 386.

327 of the Companies Act< or

(b) a company recovery order and appoints a special

controller in accordance with article 329B of the Companies Act<

it must immediately inform the competent authority, or cause

the competent authority to be informed without delay, of the

decision, order or appointment which has been made.

(3) Where the competent authority is informed of a decision,

order or appointment in accordance with this regulation, it shall, in turn

without delay and by any means available communicate the information

outlined above to the foreign authorities of any other host State in which

the credit institution has set up branches which are included on the list

referred to in Article 11 of Directive 2000⁄12⁄EC and published each

year in the Official Journal of the European Communities.

(4)

The administrative or judicial authorities referred to

in this regulation shall endeavour to coordinate their actions.

(5) The duties provided for in this regulation are supplemental

to and without prejudice to the duties of the Registrar of Courts as

stipulated in article 329B (13) (a) – (c) of the Companies Act.

PART II– WINDING-UP PROCEEDINGS

(1) The Court shall, upon receipt of an application in terms

of the Companies Act or the Controlled Companies (Procedure for

Liquidation) Act and the Act, decide on opening of winding-up

proceedings in respect of a Maltese credit institution, including its

branches established in any Member State or EEA State.

(2) The Court’s decision concerning the dissolution and

winding up of a Maltese credit institution including its branches in any

host State shall be recognised within the territory of any other Member

State or EEA State without any further formalities and shall be effective

there as soon as the Court’s decision is effective in Malta.

(3) (a) The Court shall, upon receipt of an application for

any winding up proceedings, inform the competent authority regarding

this request in order to obtain its views on the adoption of such measures

and the practical effects which they may have.

(b) Where the court makes a decision, order or appointment

of any of the following kinds-

(i)

a winding up order under article 219 of the

Companies Act< or

(ii)

the appointment of a provisional administrator

under article 228 of the Companies Act <

it must immediately inform the competent authority, or

cause the competent authority to be informed without delay

of the decision, order or appointment which has been made.

(4) Where the competent authority is informed of a decision,

order or appointment in accordance with this regulation, the competent

authority shall in turn, without delay and by any means available inform

the foreign authority in all Member States or EEA States that the

decision, order or appointment has been made and the possible effects

that of a decision, order or appointment of that kind may have.

(5)

Where an arrangement has been concluded pursuant

to article 291 of the Companies Act, any person appointed by the Maltese

credit institution or creditors shall inform the competent authority of

the arrangement which has been approved.

(6)

Where a liquidator is appointed as mentioned in article

230 of the Companies Act the liquidator must inform the competent

authority of his appointment.

(7) In the case of a member’s voluntary winding up, the

liquidator shall in article 272 of the Companies Act inform the competent

authority if he is of the opinion that the Maltese credit institution will

not be able to pay its debts within the period stated in the declaration of

solvency.

(8)

The duties provided for in this regulation are

supplemental to and without prejudice to the duties of the Registrar of

Courts in articles 224 and 264 of the Companies Act.

(9)

Nothing in these regulations shall prejudice the duties

and powers of the competent authority in relation to winding up

proceedings with respect to a Maltese credit institution including its

branches established in host States, where provided for in the Act or in

the Controlled Companies (Procedure for Liquidation) Act.

. 11. (1) Subject to the exceptions expressly provided for in Applicable law in

the winding up of a

these regulations, the decision to dissolve and wind up a Maltese credit Maltese credit

institution as well as its method of winding up and dissolution, shall be institution.

made in accordance with the general provisions of Part V of the Cap. 386.

Companies Act and in particular with article 29 of the Act and the Cap. 383

provisions of the Controlled Companies (Procedures for Liquidation)

Act.

(2)

In relation to a Maltese credit institution, the law of

Malta shall be the applicable law and shall determine in particular>-

(a)

the assets subject to administration and the treatment

of assets acquired by the credit institution after the opening of

winding-up proceedings<

(b) the respective powers of the Maltese credit institution

and the liquidator<

(c)

the conditions under which set-off may be invoked<

(d)

the effects of the winding up proceedings on current

contracts to which the Maltese credit institution is party<

(e)

the effects of the winding up proceedings brought by

individual creditors, with the exception of lawsuits pending as

provided for in these regulations<

(f)

the claims which are to be lodged against the Maltese

credit institution and the treatment of claims arising after the

opening of winding-up proceedings<

(g)

the rules governing the lodging, verification and

admission of claims<

(h)

the rules governing the distribution of proceeds from

the realisation of assets, the ranking of claims, the rights of creditors

who have obtained partial satisfaction after the opening of the

winding up order by virtue of a right in rem or through set-off<

(i)

the conditions for and the effects of the closure of

winding up proceedings, in particular by composition<

(j)

the rights of creditors after the closure of the winding

up proceedings<

(k)

who is to bear the cost and expenses incurred in the

winding up proceedings< and

(l)

the rules relating to the voidness, violability or

unenforceability of legal acts detrimental to all the creditors.

(1) Minbarra fil-ka] ta’ l-eççezzjonijiet previsti

espliçitament f’dawn ir-regolamenti, id-deçi]joni tax-xoljiment u l-

istralç ta’ istituzzjoni ta’ kreditu Maltija kif ukoll il-metodu ta’ kif

isir ix-xoljiment u l-istralç tag[ha, g[andha tittie[ed skond id-

disposizzjonijiet ;enerali tat-Taqsima V ta’ l-Att dwar il-Kumpanniji

u b’mod partikulari skond l-artikolu 29 ta’ l-Att u d-disposizzjonijiet

ta’ l-Att dwar Kumpanniji Kontrollati (Proçeduri ta’ Stralç).

(2) Fir-rigward ta’ istituzzjoni ta’ kreditu Maltija, il-li;i

ta’ Malta g[andha tkun il-li;i applikabbli u g[andha tiddetermina

ukoll, b’mod partikolari>-

(a) il-beni li huma so;;etti g[all-amministrazzjoni u l-

mod kif ji;u ttrattati l-beni li jkunu ;ew miksuba mill-

istituzzjoni ta’ kreditu wara li jkunu nfet[u l-proçeduri ta’ l-

istralç<

(b) is-setg[at rispettivi ta’ l-istituzzjoni ta’ kreditu

Maltija u l-istralçjarju<

(c)

il-kondizzjonijiet li ta[thom tista’ ti;i invokata

tpaçija<

(d) l-effetti tal-proçeduri ta’ stralç fuq kuntratti kurrenti

li tag[hom l-istituzzjoni ta’ kreditu Maltija hija parti kontraenti<

(e) l-effetti tal-proçeduri ta’ stralç mi;juba minn kredituri

individwali, bl-eççezzjoni ta’ kaw]i pendenti, kif previst f’dawn

ir-regolamenti<

(f) it-talbiet li g[andhom ji;u depo]itati kontra l-

istituzzjoni ta’ kreditu Maltija u t-trattament tat-talbiet li

jirri]ultaw mill-ftu[ ta’ proçeduri ta’ stralç<

(g) ir-regoli li jirregolaw id-depo]itu, verifika u

ammissjoni ta’ talbiet<

(h) ir-regoli li jirregolaw it-tqassim tad-d[ul mill-bejg[

ta’ l-assi, klassifika tat-talbiet, drittijiet tal-kredituri li [adu

sodisfazzjon parzjali wara l-ftu[ ta’ l-ordni ta’ stralç permezz

ta’ dritt in rem jew permezz ta’ tpaçija<

(i) il-kondizzjonijiet g[al, u l-effetti ta’, l-g[eluq ta’

proçeduri ta’ stralç, b’mod partikulari meta l-g[eluq isir permezz

ta’ kompo]izzjoni<

(j) id-drittijiet tal-kredituri wara l-g[eluq tal-proçeduri

ta’ stralç<

(k)

min g[andu j[allas l-ispejje] tal-proçeduri ta’ stralç<

(l) ir-regoli dwar l-ine]istenta, in-nullità jew in-nuqqas

ta’ inforzabbilità ta’ atti legali detrimentali g[all-kredituri

kollha.

(1) Before any voluntary winding-up decision is taken by

the board of directors or other governing bodies of a credit institution

these said governing bodies shall consult the competent authority in the

most appropriate form.

(2) The commencement of the voluntary winding up of a credit

institution shall not preclude the adoption of reorganisation measures

or the opening of winding up proceedings by the Court.

(1) Where the Court decides upon the opening of winding-up

proceedings either in the absence of reorganisation measures or in terms

of article 329 B (12) of the Companies Act following the failure of

reorganisation measures, the authorisation of the credit institution shall

be withdrawn by the competent authority in terms of the provisions of

article 9 of the Act.

(2) In the event of the withdrawal of authorisation the

competent authority shall, in terms of article 9 (7) of the Act inform the

foreign authority of the host State so as to enable it to take appropriate

measures to prevent the credit institution concerned from initiating

further transactions within its territory and to safeguard the interests of

depositors.

(3) The withdrawal of authorisation provided for in this

regulation shall not prevent the person or persons entrusted with the

winding-up from carrying on some of the credit institution’s activities

insofar as that is necessary or appropriate for the purposes of winding

up> Provided that, such activities shall be carried under the supervision

of the competent authority.

(1) The liquidator or any other person appointed for this Publication of

decision to open

purpose by the Court shall at the earliest opportunity make their decision winding up

to open winding-up proceedings public by publishing an extract from procedures by

Liquidator or Court.

the decision ordering the winding up proceedings in>-

(a) the Malta Government Gazette<

(b) any two Maltese newspapers, provided that one extract is

published in the English language and the other is published in the

Maltese language<

(c) the Official Journal of the European Communities,

provided that third party rights in any host State are capable of

being affected by the winding up proceedings< and

(d) two national newspapers in each host State, provided that

third party rights in the host State are capable of being affected by

the winding up proceedings.

(2) The publication made pursuant to regulation 14 (1) (a) to

(d), shall at least specify>-

(a) that winding-up proceedings have commenced in relation

to a Maltese credit institution<

(b) the applicable time limits for the winding up proceedings,

if any<

(c) the penalties laid down in regards to any time limits, if

any<

(d) the full address of the body or authority empowered to

accept claims or observations relating to claims and the other

measures laid down< and

(e) as to whether creditors whose claims are preferential or

secured in rem need lodge their claims.

(3) The information set out in regulation 14 (1) shall be

published in English or in both English and Maltese.

(4) A form shall also be used bearing, in all the official

languages of the European Union, the heading “Invitation to lodge a

claim. Time limits to be observed.”

(5) The duties provided for in this regulation are without

prejudice to the duties of the Registrar of Courts in article 401 of the

Companies Act and to the duties of the Controller in article 4 of the

Controlled Companies (Procedure for Liquidation) Act.

(1)

When winding-up proceedings have commenced, the

liquidator shall without delay individually inform all known creditors

wheresoever resident or domiciled, in writing>-

(a) that winding-up proceedings have commenced in relation

to a Maltese credit institution<

(b) of the applicable time limits for the winding up

proceedings, if any<

(c) of the penalties laid down in regards to any time limits, if

any<

(d) of the body or authority empowered to accept claims or

observations relating to claims and the other measures laid down<

and

(e) as to whether creditors whose claims are preferential or

secured in rem need lodge their claims.

(2) Where the liquidator shall in terms of the Companies Act

advise creditors as to inter alia the date and venue of any creditors

meeting to which the addressee may be entitled to attend such notice in

sub-regulation (1) of this regulation shall be given without prejudice

the provisions of article 296 of the Companies Act.

(3) The information set out in sub-regulation (1) of this

regulation shall be issued in English or in both English and Maltese.

(4) A form shall also be used bearing, in all the official

languages of the European Union, the heading “Invitation to lodge a

claim. Time limits to be observed.”

(5) The provisions of this regulation are without prejudice to

the duties of the Controller in article 4 of the Controlled Companies

(Procedure for Liquidation) Act.

.

(1) A liquidator shall send a written report setting out the Reports to creditors.

position in particular as regards the progress of the winding up once

every 12 months, beginning from the date when the liquidator’s

appointment has effect, to every known creditor whosesoever resident

or domiciled.

(2) Where the official receiver is acting as a liquidator the

first such report to creditors is to contain the information required in

terms of article 227 of the Companies Act.

(3) The requirement in sub-regulation (1) of this regulation

does not apply where a liquidator is required by order of the Court to

send reports to creditors at intervals which are more frequent than those

required by this regulation.

(4) The duties provided for in this regulation are without

prejudice to article 234 of the Companies Act and where applicable are

supplemental to the duties of the Controller under the Controlled

Companies (Procedure for Liquidation) Act.

(1) Where an obligation has been honoured for the benefit Honouring of

of a credit institution which is not a legal person and which is the subject obligations.

of winding up proceedings opened in another Member State or EEA

State when it should have been honoured for the benefit of the liquidator

in those proceedings, the person honouring the obligation shall be

deemed to have discharged it if he was unaware of the opening of

proceedings.

(2)

Where such an obligation is honoured before the

publication provided for in regulation 14 has been effected, the person

honouring the obligation shall be presumed, in the absence of proof to

the contrary, to have been unaware of the opening of winding up

proceedings.

(3)

Where the obligation is honoured after the publication

provided for in regulation 14 has been effected, the person honouring

the obligation shall be presumed, in the absence of proof to the contrary,

to have been aware of the opening of proceedings.

(1) Any creditor, including the public authorities of a Member

State or a EEA State, being domiciled in or having a normal place of

residence or head-office in a Member State or EEA State other than

Malta, shall have all the rights provided to creditors in Part V of the

Companies Act to lodge claims or to submit written observations relating

to claims in relation to a Maltese credit institution being wound up.

(2)

The claims of any creditor who is domiciled in or

having a normal place of residence or head offices in any Member State

or EEA States other than Malta, shall be treated in the same way as any

creditor resident or domiciled or having a head offices in Malta and

accorded the same ranking as claims of an equivalent nature which

may be lodged by creditors having their domiciles, normal places of

residence, or head offices in Malta

.(3)

When lodging a claim a creditor shall send copies of

supporting documents, if any, and shall indicate>-

(a) the nature of the claim<

(b) the date on which it arose and its amount<

(c) whether the creditor alleges preference<

(d) security in rem or reservation of title in respect of the

claim< and

(e) what assets are covered by the creditor’s security.

(4) Any creditor who is domiciled or having a normal place

of residence or head office in a Member State or EEA State other than

Malta, may lodge claims or submit observations relating to such claim

in the official language or one of the official languages of that other

Member State or EEA State. In that event, the lodgement of the creditor’s

claim or the submission of observations on such claim shall bear the

heading “Lodgement of claim” or “Submission of observations relating

to claims” in English or Maltese. In addition, the creditor may be required

to provide a translation into English or Maltese of the lodgement of

claim or submission of observations relating to claims or of any of the

documentation and, or information required in regulation 18 (3).

(5) The provisions of this regulation are without prejudice to

the provisions of article 232 of the Companies Act.

(1) Where, upon receipt of an application to adopt a decision Branches

country credit

or order to commence winding-up procedures of a branch present in institutions.

Malta of a credit institution having its head office situated outside a

Member State or EEA State, the Court shall inform the competent

authority regarding this request in order to obtain its views on the

adoption of such measure and the practical effects which it may have.

(2)

Where the Court makes a decision, order or

appointment of any of the following kinds-

(a)

a winding up order under article 219 of the Companies

Act< or

(b)

the appointment of a provisional administrator under

article 228 of the Companies Act<

it must immediately inform the competent authority, or cause

the competent authority to be informed without delay of the

decision, order or appointment which has been made.

(3) Where the competent authority is informed of a decision,

order or appointment in accordance with this regulation, the competent

authority shall in turn, without delay and by any means available

communicate such information to the foreign authorities of any other

host State in which the credit institution has set up branches which are

included on the list referred to in Article 11 of Directive 2000⁄12⁄EC

and published each year in the Official Journal of the European

Communities, and shall inform the foreign authority of the decision to

open winding-up procedures and the practical effects of such. The

competent authority shall also advise the Foreign Authority of any other

host States that the authorisation of the branch has been withdrawn.

PART III – PROVISIONS COMMON TO

REORGANISATION AND WINDING-UP PROCEEDINGS

The effects of a reorganisation measure or winding-up Employment

contracts and

proceedings of a credit institution on employment contracts and relationships.

employment relationships are determined in accordance with the laws

of the Member State or EEA State to which that contract or relationship

is subject.

The effects of a reorganisation measure or winding up

proceedings of a credit institution on a contract conferring the right to

make use of or acquire immovable property situated within the territory

of a Member State or EEA State are to be governed in accordance with

the law of that Member State or EEA State.

Rights of a credit institution in respect of immovable

property, a ship or an aircraft subject to registration in a public register

shall be governed solely by the law of the Member State or EEA State

under the authority of which the register is kept.

(1) The adoption of reorganisation measures or the

opening of winding-up proceedings of a Maltese credit institution shall

not affect the rights in rem of creditors or third parties in respect of

tangible or intangible, movable or immovable assets including both

specific assets and collections of indefinite assets as a whole which

change from time to time belonging to the credit institution concerned

which are situated within the territory of a Member State or EEA State

at the time of the opening of such measures or proceedings.

(2)

The rights in rem referred to in sub-regulation (1) of

this regulation shall in particular mean –

(a)

the right to transfer assets or have them transferred

and to obtain satisfaction from the proceeds of or the income from

those assets, in particular by virtue of a lien, mortgage or hypothec<

(b)

the exclusive right to have a claim met, in particular a

right guaranteed by a lien in respect of the claim or by assignment

of the claim by way of a guarantee<

(c)

the right to demand the assets from, and, or to require

restitution, by anyone having possession or use of them contrary

to the wishes of the party so entitled<

(d) a right in rem to the beneficial use of assets.

(3)

A right, recorded in a public register and enforceable

against third parties, under which a right in rem within the meaning of

regulation 23 (1), may be obtained, is also to be treated as a right in rem

for the purposes of this regulation.

(4) Regulation 23 (1) does not preclude actions for voidness,

voidability or unenforceability of legal acts detrimental to creditors

referred to in regulation 11 (2) (l).

(1) The commencement of reorganisation measures Reservation of title

or winding-up proceedings in relation to a Maltese credit institution agreement.

purchasing an asset shall not affect the seller’s rights based on a

reservation of title where at the time of the commencement of such

measures or proceedings the asset is situated within the territory of

another Member State or EEA State.

(2)

The commencement of reorganisation or winding-up

proceedings against a Maltese credit institution selling an asset, after

delivery of the asset, shall not constitute grounds for rescinding or

terminating the sale and shall not prevent the purchaser from acquiring

title where at the time of the opening of such measure or proceedings

the asset sold is situated within the territory of a Member State or EEA

State in which such measures or proceedings were commenced.

(3)

Sub-regulations (1) and (2) of this regulation do not

preclude actions for voidness, voidability or unenforceability of legal

acts detrimental to creditors referred to in regulation 11 (2) (l).

(1) The adoption of reorganisation measures or the Creditor’srights

set off.

opening of winding up proceedings shall not affect the rights of creditors

to demand the set-off of their claims against the claims of the Maltese

credit institution where such a set-off is permitted by the law of the

Member State or EEA State which is applicable to the claim of the

Maltese credit institution.

(2)

This regulation does not preclude actions for voidness,

voidability or unenforceability of legal acts detrimental to creditors

referred to in regulation 11 (2) (l), above.

The enforcement of proprietary rights in instruments or other Lex rei sitae.

rights in such instruments the existence or transfer of which presupposes

their recording in a register, an account or a centralised deposit system

held or located in a Member State or EEA State shall be governed by

the law of the Member State or EEA State where the register, account,

or centralised deposit system in which those rights are recorded is held

or located.

Pursuant to the provisions of the Set-Off and Netting on Netting agreements.

Insolvency Act, netting agreements shall be governed by the law of the Cap. 459.

contract which governs such agreements.

Without prejudice to regulation 26, above, repurchase

agreements shall be governed solely by the law of the contract which

governs such agreements.

Without prejudice to regulation 26, transactions carried out

in the context of a regulated market are to be governed solely in

accordance with the law of the contract which governs such transactions.

(1) The administrator or liquidator’s appointment shall be

Proof of liquidators’

evidenced by a certified copy of the original decision appointing him or

her or by any other certificate issued by the administrative or judicial

authority of the home State attesting to the due appointment of the

administrator or liquidator.

(2) A translation into the official language or one of the official

languages of the Member State or EEA State within the territory of

which the administrator or liquidator wishes to act may be required.

No legislation or other similar formality shall be required.

(3) Administrators and liquidators shall be entitled to exercise

within the territory of any Member State or EEA State all the powers

which they are entitled to exercise within the territory of the home State.

They may also appoint persons to assist or, where appropriate, represent

them in the course of the reorganisation measure or winding up

proceedings, in particular in host States and, specifically in order to

help overcome any difficulties encountered by creditors in the host State.

(4) In exercising their powers, administrators and liquidators

shall comply with the law of the Member State or EEA State within the

territory of which they wish to take action, in particular with regard to

procedures for the realisation of assets and the provision of information

to employees. Those powers may not include the use of force or the

right to rule on legal proceedings or disputes.

(1) Regulation 11, shall not apply as regards the rules relating

to the voidness, voidability or unenforceability of legal acts detrimental

to the creditors as a whole, where the beneficiary of these acts provides

proof that >-

(a) the act detrimental to the creditors as a whole is subject to

the law of a Member State or EEA State other than the home State,

and

(b) that law does not allow any means of challenging that act

in the case in point.

(2) Where a reorganisation measure decided on by a judicial

authority provides for rules relating to the voidness, voidability or

unenforceability of legal acts detrimental to the creditors as a whole

performed before adoption of the measure, regulation 4(2) shall not

apply in the cases provided for in this regulation.

Where, by an act concluded after the adoption of a Protection

party purchasers.

reorganisation measure or the opening of winding-up proceedings, a

credit institution disposes, for consideration of>-

(a)

an immovable asset situated within the territory of a

Member State or EEA State<

(b)

a ship or an aircraft subject to registration in a public

register kept under the authority of a Member State or EEA State<

or

(c)

instruments or rights in such instruments the existence

or transfer of which presupposes their being recorded in a register,

an account or a centralised deposit system held or located in a

Member State or EEA State,

the validity of that act shall be governed by the law of the

Member State or EEA State within whose territory the immovable

asset is situated or under whose authority the register, account or

system is kept, as the case may be.

The effects of reorganisation measures or winding-up Pending lawsuits.

proceedings on a pending lawsuit concerning an asset or a right of which

the Maltese credit institution has been divested shall be governed solely

in accordance with the law of the Member State or EEA State in which

the lawsuit is pending.

(1)

In order to secure the rights of interested third parties, Registration in a

an administrator or liquidator may request that a reorganisation measure public register.

or the decision to open winding-up proceedings be registered in the

registry of companies and any other public register by whatever name

kept in Malta or any other Member State or EEA State.

(2) The costs of registration are to be regarded as costs and

expenses incurred in the winding up proceedings or reorganisation

measure.

All persons required to receive or divulge information in Professional

connection with the information or consultation procedures laid down secrecy.

in these regulations shall be bound by professional secrecy, in accordance

with the rules and conditions laid down in Article 30 of Directive

2000⁄12⁄EC, with the exception of any judicial authorities to which

existing national provisions apply.

PART IV - REORGANISATION MEASURES AND

WINDING UP PROCEEDINGS IN RESPECT OF EUROPEAN

CREDIT INSTITUTIONS EFFECTIVE IN MALTA

(1)

The commencement of a reorganisation measure or

winding-up proceedings of a European credit institution has effect in

Malta as if it were part of the Companies Act, when such is in relation

to> –

(a) a branch of a European credit institution<

(b) any property or other assets of the European credit

institution< or

(c) any debt or liability of such European credit institution.

(2)

Subject to sub-regulation (4) of this regulation, the

administrator or liquidator or persons appointed to assist, or where

appropriate, represent the administrators and liquidators may exercise

in Malta, in relation to a European credit institution which is subject to

a reorganisation measure or winding-up proceedings, any function

which, pursuant to that measure or order, he is entitled to exercise in

relation to a European credit institution.

(3)

The appointment of the administrator and liquidator

shall be evidenced-

(a)

by a certified copy of the order or decision by a judicial

or administrative authority competent in the home State for

reorganisation or winding-up proceedings by or under which the

administrator or liquidator was appointed< or

(b)

by any other certificate issued by the judicial or

administrative authority which has jurisdiction in relation to a

reorganisation measure or winding-up proceedings,

and, where necessary accompanied by a certified translation

of that order, decision or certificate, as the case may be.

(4)

In exercising the functions of the kind mentioned in

sub-regulation (2) of this regulation, the administrator or the liquidator-

(a) may not take any action which would constitute an

unlawful use of force in Malta<

(b) may not rule on any dispute arising from a matter falling

within Parts I, II and III of these regulations< and

(c)

notwithstanding the way in which functions may be

exercised in the home State of the European credit institution, shall

act in accordance with the laws or rules as to procedure which are

effective in Malta.

(1) Il-ftu[ ta’ mi]ura ta’ riorganizzazzjoni jew proçeduri

ta’ stralç ta’ istituzzjoni ta’ kreditu Ewropea g[andhom effett f’Malta

riorganizzazzjoni u

proçeduri ta’ stralç

b[al li kieku kienu parti mill-Att dwar il-Kumpanniji, meta dawn

ikunu dwar>-

(a)

ferg[a ta’ istituzzjoni ta’ kreditu Ewropea<

(b) xi proprjetà jew beni o[ra ta’ l-istituzzjoni ta’ kreditu

Ewropea< jew

(c) xi dejn jew passiv ta’ din l-istituzzjoni ta’ kreditu

Ewropea.

(2) Bla [sara g[as-subregolament (4) ta’ dan ir-

regolament, l-amministratur jew stralçjarju jew persuni ma[tura biex

jassistu, jew, fejn ikun xieraq, jirrappre]entaw l-amministraturi u l-

stralçjarji, jistg[u je]erçitaw f’Malta, fir-rigward ta’ istituzzjoni ta’

kreditu Ewropea li tkun so;;etta g[al mi]ura ta’ riorganizzazzjoni

jew proçeduri ta’ stalç, kull funzjoni li, skond dik il-mi]ura jew

ordni, huwa jkun awtorizzat li je]erçita fir-rigward ta’ istituzzjoni

ta’ kreditu Ewropea.

(3) Il-[atra ta’ l-amministratur u l-stralçjarju g[andha ssir

prova dwarha>-

(a) permezz ta’ kopja çertifikata ta’ l-ordni jew deçi]joni

minn awtorità ;udizzjarja jew amministrattiva li tkun

kompetenti fl-Istat domestiku fir-rigward ta’ proçeduri ta’

riorganizzazzjoni jew stralç li permezz tag[hom l-amministratur

jew stralçjarju kien ma[tur< jew

(b) permezz ta’ kull çertifikat ie[or ma[ru; mill-awtorità

;udizzjarja jew amministrattiva li jkollha ;urisdizzjoni fuq

mi]ura ta’ riorganizzazzjoni jew proçeduri ta’ stralç, u dawn

g[andhom jkollhom mag[hom traduzzjoni çertifikata ta’ dik l-

ordni, deçi]joni jew çertifikat, skond kif ikun il-ka].

(4) Fl-e]erçizzju tal-funzjonijiet tieg[u ta[t is-

subregolament (2) ta’ dan ir-regolament, l-amministratur jew l-

istralçjarju-

(a) ma jistax jie[u azzjoni li tkun tammonta g[al u]u illegali

tal-forza f’Malta<

(b) ma jistax jie[u deçi]joni fuq tilwima li tirri]ulta minn

kwistjoni li taqa’ ta[t it-Taqsimiet I, II, u III ta’ dawn ir-

regolamenti< u

Istituzzjonijiet ta’

(c) minkejja l-mod kif il-funzjonijiet tieg[u jistg[u jkunu kreditu Ewropej

e]erçitati fl-Istat domestiku ta’ l-istituzzjoni ta’ kreditu b’ferg[at f’Malta.

Ewropea, g[andu ja;ixxi skond il-li;ijiet jew regoli ta’

proçedura li japplikaw f’Malta.

(1) From the date of coming into force of these European credit

institutions with

regulations, the Court may not, in relation to a European credit institution branches in Malta.

or any branch of a European credit institution –

(a)

make a winding up order pursuant to article 224 of

the Companies Act< or

(b) adopt reorganisation measures or perform any act

ancillary to the adoption of such measures in terms of Part VI of

the Companies Act.

(2)

Paragraph (a) of sub-regulation (1) of this regulation

does not prevent>-

(a)

the Court from making a winding up order after the

relevant date in relation to a European credit institution if-

(i)

a provisional administrator was appointed in

relation to the European credit institution before the relevant

date, and

(ii)

the appointment continues in force until

immediately before that winding up order is made<

(b)

the winding up of a European credit institution after

the relevant date pursuant to a winding up order which was made,

and has not been discharged, before that date.

(3)

Paragraph (b) of sub-regulation (1) of this regulation

does not prevent a provisional administrator of a European credit

institution appointed before the relevant date from acting in relation to

such institution after that date.

(4)

Nothing in these regulations shall affect any

proceedings commenced in any Court concerning the reorganisation or

winding-up of a credit institution where such proceedings were

commenced before the 1 st May, 2004.

(5)

In this regulation, the expression “relevant date”

st

means the 1 May, 2004.

PART V – INTERPRETATION

(1) The purpose of these regulations is to implement the

provisions of Directive 2001⁄24⁄EC of the European Parliament and of

the Council of 4 th April, 2001 on the reorganisation and winding-up of

credit institutions, and shall be interpreted and applied accordingly.

(2)

In the event that there is a conflict between any of

these regulations and the provisions of the Directive mentioned in sub-

regulation (1) hereof, the provisions of the Directive shall prevail.

PART VI – TRANSITIONAL PROVISIONS

These regulations shall only apply to reorganisation

measures or winding up proceedings adopted immediately after the date

of coming into force of these regulations.