Regulations, 2004

L.N. 491 of 2004

FINANCIAL MARKETS ACT

(CAP. 345)

Recognised Investment Exchange (Transparency)

Regulations, 2004

IN exercise of the powers conferred by article 3 of the Financial

Markets Act, the Prime Minister and Minister of Finance, acting on the

advice of the Malta Financial Services Authority as the competent

authority for the purposes of the Act, has made the following regulations

(1) The title of these regulations is the Recognised

Investment Exchange (Transparency) Regulations, 2004.

(2) These regulations shall come into force on the 30 th

November, 2004.

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

relevant provisions of the Council Directive 93#22#EEC of the 10 th May,

1993 on investment services in the securities field as currently in force

and as may be amended from time to time, and such regulations shall

be interpreted and applied accordingly.

(1)

In these regulations, unless the context otherwise

requires

“the Act” means the Financial Markets Act;

“illiquid security” means a security without an active

secondary market, where trading in such security is characterized

by low volume or a low frequency of trades, or both;

“instrument” shall have the same meaning as that provided

in article 2 of the Investment Services Act;

“recognised investment exchange” means a person in respect

of whom the competent authority has issued a recognition order in

terms of article 4 of the Act;

“weighted average price” means the value of the trades in an

instrument divided by the volume of trades in such instrument over

a defined period.

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

shall have the same meaning as in the Act.

These regulations set out the minimum transparency Scope.

requirements which must be satisfied on a continuing and on-going

basis by recognised investment exchanges in accordance with indent

(i) of sub-paragraph (3) of paragraph 5 of the Schedule to the Recognised

Investment Exchange (Recognition Requirements) Regulations, 2003, L.N. 3 of 2003.

and they shall be read and interpreted in conjunction with the said

regulations.

The following requirements shall be satisfied on a continuing Minimum

transparency

and on-going basis by recognised investment exchanges

requirements.

(a) at the start of each day’s trading on the market, a

recognised investment exchange shall, for each instrument traded

on the recognised investment exchange, publish on its internet

website and at least in one local newspaper which is widely

distributed in Malta

(i)

the weighted average price;

(ii) the highest and the lowest prices; and

(iii)

the volume dealt in on the market,

for the whole of the preceding day’s trading;

(b) where a recognised investment exchange operates a

continuous order driven or quote driven market, in addition to the

above, the recognised investment exchange shall also publish on

its internet website

(i) at the end of each hour’s trading on the market,

the weighted average price and volume dealt in on the market

in question for a six hour trading period ending so as to leave

two hours’ trading on the market before publication; and

(ii) every twenty minutes, the weighted average price

and the highest and lowest prices on the regulated market in

question for a two-hour trading period ending so as to leave

one hour’s trading on the market before publication

Provided that the competent authority may authorise the delay

or suspension of the publication of the information required in this

regulation, where exceptional market conditions exist or where it deems

it necessary in order to preserve the anonymity of firms and investors;

Provided further that in case of exceptional transactions that

are very large in scale compared with average transactions in the

instrument concerned and in the case of a highly illiquid security, upon

a request by a recognised investment exchange, the competent authority

may exempt the recognised investment exchange from all or some of

the requirements in paragraphs (a) and (b) of this regulation, and may

apply special provisions.

Where a recognised investment exchange provides investors

with prior access to information on the prices and quantities for which

transactions may be undertaken, the recognised investment exchange

shall ensure that

(a) such information is available at all times during market

trading hours; and

(b) the terms announced for a given price and quantity are

the terms on which it is possible for an investor to carry out such a

transaction.

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