Infringements) Regulations, 2007

Suppliment tal-Gazzetta tal-Gvern ta’ Malta, Nru. 18,082, 29 ta’ Mejju, 2007

L.N. 143 of 2007

INSURANCE INTERMEDIARIES ACT

(CAP. 487)

Insurance Intermediaries (Penalties for Offences and

Infringements) Regulations, 2007

IN exercise of the powers conferred by articles 3 and 53 of the

Insurance Intermediaries Act, the Prime Minister and the Minister of

Finance, after consultation with the Malta Financial Services Authority,

has made the following regulations>-

(1) The title of these regulations is the Insurance Citation and

Intermediaries (Penalties for Offences and Infringements) Regulations, Commencement.

2007. (2) These regulations shall come into force on the 1st June,

2007. In these regulations, unless the context otherwise requires -

(Regulation 3)

Penalties which are enforceable by prosecution in the courts of Malta

First Column

Second Column

Third Column

Level

Fine (multa)

Imprisonment

not less than Lm100 but

not more than three months

not more than Lm5,000

not less than Lm1,000 but

not less than one month but

not more than Lm10,000

not more than six months

not less than Lm5,000 but

not less than six months but

not more than Lm50,000

not more than two years.

Interpretation.

“the Act” means the Insurance Intermediaries Act<

“administrative penalty” means a penalty which may be

imposed and is recoverable by the Authority without recourse to a

court hearing<

“the Authority” means the Malta Financial Services Authority

established by article 3 of the Malta Financial Services Authority Cap. 330.

Act and appointed under article 3 of the Insurance Business Act to

be the competent authority for the purposes of that Act and, by

virtue of article 3(1) of the Act, for the purposes of the Act<

“court penalty” means a penalty which is enforceable by

prosecution in the courts of Malta<

“Financial Services Tribunal” shall be construed in accordance

with article 50 of the Act<

“insurance intermediaries rule” has the same meaning as is assigned

to it by article 2 of the Insurance Intermediaries Act<

“Schedule” means a schedule to these regulations,

and the words and expressions which are also used in the Act have the

same meanings as in the Act.

(Regulation3)

Administrative penalties which may be imposed by the Authority without recourse to a

court hearing

First Column

Second Column

Third Column

Level

Penalty

Daily penalty

not less than Lm50 but

not less than Lm5 but

not more than Lm250

not more than Lm15

not less than Lm100 but

not less than Lm10 but

not more than Lm1,000

not more than Lm30

not less than Lm1,000 but

not less than Lm20 but

not more than Lm40,000

not more than Lm50.

(1) For the purposes of these regulations, penalties are

divided into court penalties which are enforceable by prosecution in

the courts of Malta and administrative penalties, and -

“court penalties” shall be construed in accordance with the

provisions of the First Schedule, and

“administrative penalties” shall be construed in accordance

with the provisions of the Second Schedule.

(2) With respect to a penalty of any level specified in the

first column of the First Schedule which is a court penalty, the penalty

shall be either the corresponding fine (multa) specified in the second

column thereof or the corresponding period of imprisonment specified

in the third column thereof.

(3) With respect to an administrative penalty of any level

specified in the first column of the Second Schedule the penalty shall

be the corresponding amount specified in the second column thereof

and the corresponding amount for each day during which the

infringement continues specified in the third column thereof.

(Regulation 4)

Court Penalties

Second Column

Offence

Acting as an insurance intermediary and carrying on

insurance intermediaries activities in or from Malta

without registration or enrolment

Carrying out insurance intermediaries activities, or

setting up or acquiring a subsidiary in a country

outside Malta without the written consent of the

Authority

Disclosing of information relating to the affairs of an

enrolled person or a client of an enrolled person other

than in specified circumstances

Failure to comply with any lawful order or

requirement of the Authority

Failure to comply with any lawful order or

requirement of any other person made under the Act

or any regulations made thereunder

Altering, suppressing, concealing, destroying or

refusing to produce any document which is lawfully

required to be produced by any person under the Act

or any regulations made thereunder

Knowingly being a party to, or procuring or aiding

and abetting, any contravention of any provision of

the Act or any regulations made thereunder or any

insurance intermediaries rules.

Any other offence arising under any provision of the Act not specifically

provided for in this Schedule

(1) Any person found guilty of an offence for having

contravened a provision of the Act mentioned in the first column of the

Third Schedule, with a corresponding general description of the offence

set out in the second column thereof, shall be liable to the corresponding

penalty of the level specified in the third column of the said Schedule.

(2) For any failure by any person to comply with any

provision of the Act mentioned in the first column of the Fourth

Schedule, consisting in the corresponding act or omission described in

the second column thereof, the Authority may by notice in writing

impose by way of an administrative penalty on the person concerned

the corresponding penalty specified in the third column of the said

schedule.

(3) Any description in the second column of the Third and

Fourth Schedules of any offence and failure as respectively referred to

in subregulations (1) and (2) shall not be relied on in interpreting the

provision to which the offence or failure corresponds.

(Regulation 4)

In this Schedule, “Administrative Penalties” are those made and for the purpose of article

3(2)(h) of the Act.

Administrative Penalties

Second Column

Infringement

Failure of enrolled person to have in its favour at all

times a professional indemnity insurance or other

comparable guarantee satisfying the requirements of

article 10(1)(v)

Opening a branch or setting up or acquiring a

subsidiary in Malta without making an application in

that regard to the Authority

Carrying out of insurance intermediaries activities

from a branch in Malta under the management of a

person other than a person who is a registered person

under the Act

Failure of person or company to comply with any

condition of registration or enrolment

Failure of displaying at the place of business in a part

accessible to public certificate of registration or

enrolment

Failure of person having his name struck off the

Agents Register, Managers Register or Brokers

Register or company having its name struck off the

Agents List, Managers List or Brokers List to

surrender to the Authority certificate of registration or

enrolment or any official copies thereof.

Failure of enrolled person to keep in a separate

account monies held in a fiduciary capacity in

accordance with requirements as may be determined

by an insurance intermediaries rule made for the

purpose of article 20

Second Column

Infringement

Failure of enrolled person to effect and hold a fidelity

bond as respects its insurance intermediaries activities

in accordance with requirements as may be

determined by an insurance intermediaries rule made

for the purpose of article 21

Failure of enrolled company to notify the Authority in

writing, within a specified period, the name and the

other particulars of the company’s directors and

employees who are registered in the Agents Register,

Managers Register or Brokers Register; or to notify

the Authority in writing, within a specified period, any

changes occurring among such directors and

employees.

Failure of enrolled company to forward annually to

the Authority a copy of the company’s financial

statements or failure of enrolled person to forward

annually to the Authority a copy of the income

statements; or to forward such statements within a

specified period or a period as may be authorised by

the Authority; or to forward a copy of such statements

drawn up in accordance with the provisions of article

Failure of enrolled persons to forward annually to the

Authority a statement in respect of insurance

intermediaries activities carried out by such person; or

to forward such statement in the form, content and

manner as may be determined by an insurance

intermediaries rule made for the purpose of article 25

Failure of enrolled person to notify the Authority in

writing of ceasing to carry out insurance

intermediaries activities or to comply with any

condition made by the Authority in the permit to cease

the business

Failure of enrolled company to inform the Authority

in writing of altering its financial year

Failure of enrolled company to appoint approved

auditor

Second Column

Infringement

Failure of auditor to give notice in writing to the

Authority if he resigns, does not seek re-appointment,

qualifies the audit report or failure to specify reasons

in the case of resignation

Failure of enrolled company to give notice in writing

to the Authority if it receives notice of a resolution to

appoint as auditor a person other than the retiring

auditor or not to re-appoint the retiring auditor

Failure of enrolled company to notify the Authority in

writing, or to notify the Authority in writing within a

specified period, the reasons for terminating the

appointment of the company’s auditor

Failure of enrolled company to change auditor if so

required by the Authority

Failure of auditor to inform the Authority of any of the

matters, facts and decisions provided by article 28(12)

or (14)

Negotiating, arranging or procuring with an

unauthorised company a contract of insurance relating

to a risk situated in Malta or a commitment where

Malta is the country of the commitment unless

otherwise approved

Failure of enrolled person to register with the

Authority an underwriting agreement made or entered

into by the person

Accepting of business of insurance under an

underwriting agreement by an enrolled person, unless

such underwriting agreement is duly registered by the

enrolled person with the Authority

Acting as a tied insurance intermediary and carrying

out tied insurance intermediaries activities without

registration in any Tied Insurance Intermediaries

Company Register of a company and enrolment in the

Tied Insurance Intermediaries List

Second Column

Infringement

Failure of authorised company appointing persons to

act as tied insurance intermediaries and to carry out

tied insurance intermediaries activities on its behalf

without establishing and maintaining the Tied

Insurance Intermediaries Company Register of the

company; or to establish and maintain the Tied

Insurance Intermediaries Company Register of the

company in accordance with requirements as may be

determined by an insurance intermediaries rule made

for the purpose of article 34

Failure of authorised company to enrol in the Tied

Insurance Intermediaries List a person registered by

the company as a tied insurance intermediary in the

Tied Insurance Intermediaries Company Register of

the company

Failure of authorised company to furnish a person in

whose name a certificate of enrolment is issued with

that certificate or an official copy thereof

Failure of person enrolled in the Tied Insurance

Intermediaries List of displaying at the place of

business in a part accessible to the public the

certificate of enrolment or an official copy thereof

Failure of company enrolled in the Tied Insurance

Intermediaries List carrying out tied insurance

intermediaries activities from more than one place of

business to carry out those activities from each place

of business by a person who is a fit and proper person

to carry out such activities

Seeking appointment and registration in the Tied

Insurance Intermediaries Company Register of more

than one company authorised to carry on long term

business in respect of any one class of long term

business

Seeking appointment and registration in the Tied

Insurance Intermediaries Company Register Sub-

agents Company Register of more than one company

authorised to carry on general business in respect of

any one class, or any one group of classes, of general

business

Second Column

Infringement

Failure of person or company to comply with any

condition of enrolment

Failure of the tied insurance intermediary to keep in a

separate account monies held in a fiduciary capacity in

accordance with requirements as may be determined

by an insurance intermediaries rule made for the

purpose of article 38

Failure of authorised company striking the name of a

person off the Tied Insurance Intermediaries Company

Register of the company to notify the Authority in

writing of that striking off or of the date of effect of

that striking off

Failure of authorised company to strike the name of a

person off the Tied Insurance Intermediaries Company

Register of the company on grounds of unfitness and

improperness or because the person concerned has

acted fraudulently, or dishonestly, or in such manner

as to cease to be trustworthy

Failure of authorised company to notify the Authority

in writing the reasons for striking off that name when

the company strikes the name of a person off the Tied

Insurance Intermediaries Company Register of the

company on specified grounds

Failure of authorised company to strike the name of a

person off the Tied Insurance Intermediaries Company

Register of the company if so required by the

Authority

Failure of authorised company to comply with a

directive of the Authority to hasten the process as

striking the name of a person off the Tied Insurance

Intermediaries Company Register of the company if so

required by the person concerned

Failure of authorised company to surrender to the

Authority the certificate of enrolment, or any official

copies thereof, issued in the name of a person whose

name has been struck off the Tied Insurance

Intermediaries Company Register of the company

Second Column

Infringement

Failure of a person to comply with any measure taken

by the Authority for the purpose of article 41

Failure of a person acting as a tied insurance

intermediary and carrying out tied insurance

intermediaries activities on behalf of a European

insurance undertaking without enrolment in the Tied

Insurance Intermediaries List

Failure of registered or enrolled person to notify the

Authority in writing of any material change in

documentation provided, or required to be provided,

by or under any provision of the Act

Failure of enrolled company to submit in writing to

the Authority for the Authority’s approval particulars

of any proposed addition or alteration to the

company’s memorandum or articles of association or

other instrument constituting the company

Failure of the enrolled company to inform the

Authority of the names of the persons holding a

qualifying shareholding in the company and the

percentage of such holding in the form, manner and

content within such date as determined by an

insurance intermediaries rule made for the purpose of

article 44(2)(b)

Failure of authorised companies to open for public

inspection the Tied Insurance Intermediaries

Company Register of the company; or to open the

Register for inspection free of charge

Failure of person to use the word “insurance” as part

of his description or title or to make any such use on

any letter paper, in any notice or advertisement, or in

any other similar manner without the written

permission of the Authority

Failure of enrolled company to add any explanatory

particulars to the company’s name as directed by the

Authority

Second Column

Infringement

Failure of person to satisfy any requirement of, or

obligation determined by, any provision of any

insurance intermediaries rule made for the purpose of

any article of the Act other than an article mentioned

in this Schedule and the Third Schedule to the

regulations.

Any other infringement against any other provisions of the Act or any

regulations made thereunder or any insurance intermediaries rule not

specifically provided for in this Schedule.

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

The penalties specified in the Third Schedule to the Insurance Application

certain penalties

Business (Penalties for Offences and Infringements) Regulations, prescribed by the

prescribed by virtue of Insurance Business Act, with reference to articles Insurance

(Penalties for

29, 30, 31A or 38 of the said Act shall apply with respect to a person Offences and

found guilty of the offences against the said articles of the said Act as Infringements)

Regulations, 2000.

made applicable to him by virtue of articles 52(1)(b) and 54 of the Act. L.N. 100 of 2000.

In accordance with the provisions of article 50 of the Act any Appeal to the

person upon whom the Authority has imposed an administrative penalty Financial

Tribunal.

in accordance with the provisions of regulation 4(2) may appeal in

writing to the Financial Services Tribunal against the decision of the

Authority.

(1) Where a notice imposing an administrative penalty is Recovery of

administrative

served on a person and -

penalties.

(a) such person fails to appeal within such time as an appeal

may be entered, and fails to pay the penalty so imposed< or

(b) appeals within such time to the Financial Services

Tribunal and the appeal is withdrawn or the Tribunal confirms the

penalty in the amount fixed by the Authority or in an amount

reduced by it, and the penalty is not paid within fifteen days from

the date of the withdrawal of the appeal or the date when the

Tribunal confirms the penalty as aforesaid,

then, in every case, the Authority shall be entitled to take civil action to

recover the amount due to it.

(1) Saving the provisions of this regulation, the Insurance Repeals and

Savings.

Intermediaries (Penalties for Offences and Infringements) Regulations,

2000 are hereby repealed without prejudice to anything done or omitted L.N. 101 of 2000.

to be done thereunder.

(2) Any person who on the date of coming into force of the

Act was authorised to act as an insurance agent or insurance manager

under the Insurance Business Act, shall, in respect of any outstanding Cap. 403.

penalties due to the Authority by such person under the Insurance

Business (Penalties for Offences and Infringements) Regulations, 2000 L.N. 100 of 2000.

up to that date, continue to be governed by such regulations.