Regulations, 2011

Suppliment tal-Gazzetta tal-Gvern ta’ Malta Nru. 18,769, 28 ta’ Ġunju, 2011

Taqsima

L.N. 243 of 2011

INVESTMENT SERVICES ACT

(CAP. 370)

Investment Services Act (UCITS Management Company Passport)

Regulations, 2011

IN exercise of the powers conferred by article 12 of the

Investment Services Act, the Minister of Finance, the Economy and

Investment, acting on the advice of the Malta Financial Services

Authority, has made the following regulations:-

PRELIMINARY

(1)

The title of these regulations is the Investment Citation,

Services Act (UCITS Management Company Passport) Regulations, commencement

and scope.

2011. (2) These regulations shall come into force on 1st July, 2011.

(3) These regulations shall apply to Maltese management

companies and to European management companies providing

services in Malta through the establishment of a branch or under the

freedom to provide services.

(4) These regulations transpose and implement, in part, the

provisions of articles 1(3), 2(1)(c) to (e) and (g), 17 to 21 and 109(1)

to (3) of the UCITS Directive and they shall be interpreted and

applied accordingly.

(1)

In these regulations, unless the context otherwise Interpretation

requires

"the Act" means the Investment Services Act;

"branch" means a place of business which is part of the

management company, which has no legal personality and which

provides the services for which the management company has been

authorised;

"ESMA" means the European Securities and Markets Authority

established by Regulation (EU) No. 1095/2010 of the European

Parliament and of the Council of the 24 November 2010;

"European management company" means a management

company authorised by a European regulatory authority in a Member

State or EEA State other than Malta and the regular business of which

is the management of UCITS;

"European management company home Member State or EEA

State" means the Member State or EEA State in which the European

management company has its registered office;

"European management company host Member State or EEA

State" means the Member State or EEA State, other than the home

Member State or EEA State within the territory of which a European

management company has a branch or provides services;

"European UCITS" means a UCITS authorised by a European

regulatory authority in a Member State or EEA State other than

Malta;

"home Member State or EEA State" means the Member State or

EEA State in which the registered office and head office of the

management company is situated;

"host Member State or EEA State" means the Member State or

EEA State, other than the home Member State or EEA State, within

the territory of which a management company has a branch or

provides services;

"key investor information" shall have the same meaning

assigned to it in the Investment Services Rules;

"Maltese management company" means a management

company licensed by the competent authority with its head office and

registered office situated in Malta and the regular business of which is

the management of UCITS;

"Maltese UCITS" means -

(a)

an investment company, a partnership en

commandite or a limited partnership with its registered office

and head office situated in Malta and licensed in terms of the

Act;

(b)

where the UCITS is constituted as a common fund,

a UCITS domiciled in Malta in terms of the Investment Services

Act (Contractual Funds) Regulations, and licensed in terms of

the Act;

(c)

where the UCITS is established as a unit trust, a

unit trust whose proper law is the law of Malta;

"Tribunal" means the Financial Services Tribunal established in

terms of the Malta Financial Services Authority Act;

"UCITS" means undertakings for collective investment in

transferable securities in terms of regulation 3 of the Investment

Services Act (Marketing of UCITS) Regulations, 2011;

"UCITS Directive" means Directive 2009/65/EC of the

European Parliament and of the Council of 13 July 2009 on the

coordination of laws, regulations and administrative provisions

relating to undertakings for collective investment in transferable

securities (UCITS) (recast);

"UCITS home Member State or EEA State" means the Member

State or EEA State in which a UCITS is authorised pursuant to Article

5 of the UCITS Directive.

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

have the same meaning as in the Act.

(3) In the event that any of these regulations conflict with the

provisions of the UCITS Directive, the latter shall prevail.

FREEDOM OF ESTABLISHMENT AND FREEDOM TO

PROVIDE SERVICES BY MALTESE MANAGEMENT

COMPANIES

(1)

Where a Maltese management company decides to Freedom of

establish a branch in a Member State or EEA State other than Malta, establishment

Maltese

it shall notify the competent authority accordingly.

management

companies -

branch.

(2) A notification in terms of sub-regulation (1) shall be

accompanied by the following information and documentation

(a)

the Member State or EEA State within the territory

of which the Maltese management company plans to establish a

branch;

(b)

a programme of operations setting out the activities

and services as prescribed in the applicable Investment Services

Rules which shall be carried out by such branch;

(c)

the proposed organisational structure of the branch,

including a description of the risk management process in place

and a description of the procedures and arrangements

implemented to ensure a suitable investor complaints procedure

in terms of the Investment Services Rules;

(d)

the address of the proposed branch in the host

Member State or EEA State from where documents may be

obtained; and

(e)

the names of the persons responsible for the

management of the branch.

(3) The competent authority shall communicate the

information in sub-regulation (2) and details of the Maltese investor

compensation scheme to the European regulatory authority of the

Member State or EEA State where the Maltese management company

intends to establish a branch within two months of receiving such

information. The competent authority shall also inform the Maltese

management company of such communication accordingly.

(4) Where the branch of the Maltese management company

will carry out the activity of collective portfolio management

pursuant to the Investment Services Rules, the notification made in

accordance with sub-regulations (1) and (2) shall also include an

attestation that the Maltese management company has been licensed

to pursue such activity in terms of the UCITS Directive, a description

of the scope of the Maltese management company’s licence and

details of any restriction on the types of UCITS that the Maltese

management company is licensed to manage.

(5) Where the competent authority has sufficient reason to

doubt the adequacy of the administrative structure or the financial

situation of a Maltese management company, taking into account the

activities for which it has been licensed, it may refuse to make the

communication referred to in sub-regulation (3) and shall, within two

months from the date of receipt of the notice referred to in sub-

regulation (1), give the Maltese management company reasons for

such refusal.

(6) A Maltese management company which pursues activities

through a branch within the territory of another Member State or EEA

State shall comply with the applicable provisions on conduct of

business in force in that Member State or EEA State.

(7) A branch of a Maltese management company shall not

commence business unless

(a)

the European regulatory authority in the Member

State or EEA State in which the Maltese management company

proposes to establish a branch has notified the Maltese

management company of the receipt of the communication

referred to in sub-regulation (3) from the competent authority;

or

(b)

two months have elapsed from the date on which

the competent authority has transmitted the communication

referred to in sub-regulation (3) and the Maltese management

company has not received any communication from such

European regulatory authority.

(8) Where the Maltese management company plans a change

in any of the particulars communicated in accordance with sub-

regulation (2)(b) to (e), written notice of such change shall be given

to the competent authority and to the European regulatory authority

of the Member State or EEA State in which the branch is established

not less than one month prior to the implementation of such change,

and the provisions of sub-regulations (3), (4), (5) and (7) shall apply.

(9) In the event of a change in the particulars communicated in

accordance with sub-regulations (2) and (3), the competent authority

shall inform the European regulatory authority accordingly. The

competent authority shall update the attestation referred to sub-

regulation (4) and shall, without delay, inform the European

regulatory authority of the Member State or EEA state in which the

branch is established whenever there is a change in the scope of a

Maltese management company’s authorisation or in the details of any

restriction on the types of UCITS that a Maltese management

company is licensed to manage.

(1)

A Maltese management company wishing to Freedom of

exercise the right to provide services in a Member State or EEA State establishment

Maltese

other than Malta for the first time shall submit to the competent management

companies -

authority a notice containing the following information

services.

(a)

the Member State or EEA State within the territory

of which the Maltese management company intends to operate;

(b)

a programme of operations stating the activities

and services in terms of the Investment Services Rules which

the Maltese management company intends to carry out,

including a description of the risk management process

implemented by the Maltese management company and a

description of the procedures and arrangements implemented in

accordance with the Investment Services Rules.

(2) The competent authority shall, within one month of

receiving the information referred to in sub-regulation (1), forward it

to the European regulatory authority of the Member State or EEA

State where the Maltese management company intends to provide

services. The competent authority shall also communicate to such

European regulatory authority the details of any applicable

compensation scheme intended to protect investors.

(3) Where a Maltese management company intends to carry

out the activity of collective portfolio management pursuant to the

applicable Investment Services Rules, the competent authority shall,

together with the information prescribed in sub-regulations (1) and

(2), also provide the European regulatory authority of the Member

State or EEA State where the Maltese management company intends

to provide services with an attestation that the Maltese management

company has been licensed pursuant to the provisions of the UCITS

Directive, a description of the scope of the Maltese management

company’s authorisation and the details of any restriction on the types

of UCITS that the Maltese management company is licensed to

manage.

(4) Notwithstanding the provisions of regulation 6 of these

regulations and regulation 4 of the Investment Services Act

(Marketing of UCITS) Regulations, 2011, upon expiration of the

period prescribed in sub-regulation (2), the Maltese management

company may commence to provide the service or services in

question in the European host Member State or EEA State.

(5) A Maltese management company which pursues activities

under the freedom to provide services shall comply with the

provisions of the Act, any applicable regulations made thereunder and

the Investment Services Rules.

(6) Where the content of the information communicated in

accordance with sub-regulation (1)(b) is amended, a Maltese

management company shall give prior written notice of such

amendment to the competent authority and to the European regulatory

authority of the Member State or EEA State where the Maltese

management company is providing services.

(7) The competent authority shall update the information

contained in the attestation referred to in sub-regulation (3) and shall

inform the European regulatory authority of the Member State or

EEA State where the Maltese management company is providing

services whenever there is a change in the scope of the Maltese

management company’s licence or in the details of any restriction on

the types of UCITS that the Maltese management company is

licensed to manage.

(1)

A Maltese management company which pursues Activity of

the activity of collective portfolio management on a cross-border collective

portfolio

basis by establishing a branch or under the freedom to provide management

a cross-border

services shall comply with the provisions of the Act, any applicable basis by Maltese

regulations made thereunder and the Investment Services Rules and management

companies.

the requirements prescribed thereunder shall not be any stricter than

those applicable to Maltese management companies conducting their

activities only within the territory of Malta.

(2) The competent authority shall be responsible for

supervising the compliance of a Maltese management company with

the regulatory requirements referred to in sub-regulation (1).

(3) In addition to the requirements of sub-regulation (1), a

Maltese management company which pursues the activity of

collective portfolio management of a European UCITS on a cross-

border basis by establishing a branch in another Member State or

EEA State or in accordance with the freedom to provide services shall

also comply with the applicable provisions in force in the UCITS

home Member State or EEA State implementing the provisions of the

UCITS Directive on the constitution and functioning of UCITS, and

in particular it shall comply with the requirements applicable to

(a)

the setting up and authorisation of the UCITS;

(b)

the issuance and redemption of units and shares;

(c)

investment policies and

limits,

including

calculation of total exposure and leverage;

(d)

restrictions on borrowing, lending and uncovered

sales;

(e)

the valuation of assets and the accounting of the

UCITS;

(f)

the calculation of the issue price and, or

redemption price and rules regarding errors in the calculation of

the net asset value and related investor compensation;

(g)

the distribution or reinvestment of the income;

(h)

the disclosure and reporting requirements of the

UCITS, including the prospectus, the key investor information

and periodic reports;

(i)

the arrangements made for marketing;

(j)

the relationship with unit-holders;

(k)

the merging and restructuring of UCITS;

(l)

the winding up and liquidation of the UCITS;

(m)

where applicable, the content of the unit-holder

register;

(n)

the licencing and supervision fees regarding the

UCITS; and

(o)

the exercise of unit-holders’ voting rights and other

unit-holders’ rights in relation to paragraphs (a) to (m).

(4) A Maltese management company shall comply with the

obligations set out in the prospectus and in the instruments of

incorporation of the European UCITS which it manages and such

documents shall be consistent with the requirements of the applicable

law as referred to in sub-regulations (1) and (3).

(5) A Maltese management company shall adopt and

implement all arrangements and organisational decisions necessary to

ensure compliance with the applicable provisions relating to the

constitution and functioning of the European UCITS. The Maltese

management company shall also be responsible for compliance with

the obligations set out in the prospectus and in the instruments of

incorporation of the European UCITS.

(6) The competent authority shall supervise the adequacy of

the arrangements and organisation of a Maltese management

company in order to ensure that such Maltese management company

is in a position to comply with the obligations and rules applicable to

the constitution and functioning of all the European UCITS it

manages.

(1)

A Maltese management company which intends to

manage a European UCITS shall apply to the European regulatory

authority of the UCITS home Member State or EEA State and shall

provide the said European regulatory authority with the following

documentation

(a)

the written agreement with the custodian pursuant

to the applicable Investment Services Rules; and

(b)

information on delegation arrangements regarding

functions of investment management and administration

referred to in the Investment Services Rules

Provided that, where the Maltese management company already

manages UCITS of the same type in the same European Member

State or EEA State, reference to the documentation already provided

shall be sufficient.

(2) A Maltese management company shall notify any

subsequent material modifications of the documentation referred to in

sub-regulation (1) to the European regulatory authority of the UCITS

home Member State or EEA State.

(3) In so far as necessary to enable the European regulatory

authority of the UCITS home Member State or EEA State to ensure

compliance with the rules for which it is responsible, the competent

authority shall, upon specific request by that European regulatory

authority, provide clarifications and information within ten working

days of the initial request with regards to the following

(a)

the documentation referred to in sub-regulation (1);

and

(b)

on the basis of the attestation provided by the

competent authority pursuant to regulations 3 and 4,

information as to whether the type of UCITS for which

authorisation is requested falls within the scope of a Maltese

management company’s licence.

(4) Following prior consultation with the competent authority,

the European regulatory authority of the UCITS home Member State

or EEA State may refuse the application of a Maltese management

company to manage that UCITS only if

(a)

the Maltese management company does not

comply with the fund rules applicable in the UCITS home

Member State or EEA State and for which the European

regulatory authority in the UCITS home Member State or EEA

State is responsible to ensure compliance;

(b)

the Maltese management company is not licensed

by the competent authority to manage the type of UCITS for

which authorisation is requested in terms of sub-regulation (1);

(c)

the Maltese management company has failed to

provide the European regulatory authority in the UCITS home

Member State or EEA State with the documentation referred to

in sub-regulation (1).

Where a Maltese management company duly licensed

proposes, without establishing a branch, only to market the units of

Maltese or European UCITS it manages in a Member State or EEA

State different from the UCITS home Member State or EEA State,

such marketing shall be subject only to the requirements prescribed in

the Investment Services Act (Marketing of UCITS of UCITS)

Regulations, 2011.

(1)

Where a Maltese management company which has

a branch or provides services within the territory of another Member

State or EEA State is in breach of the rules in force in that Member

State or EEA State, the European regulatory authority of that Member

State or EEA State shall require the Maltese management company to

put an end to such breach. The European regulatory authority shall

also notify the competent authority in writing detailing such breach.

(2) Where a Maltese management company refuses to provide

the European regulatory authority of the Member State or EEA State

in which it has established a branch in terms of regulation 3 or in

which it provides services in terms of regulation 4, with information

requested by and falling within the remit of that European regulatory

authority or fails to take the necessary steps to put an end to a breach

reported pursuant to sub-regulation (1), the European regulatory

authority of the said Member State or EEA State shall notify the

competent authority in writing. The competent authority shall, as

soon as possible, take all appropriate measures to ensure that the

Maltese management company provides the information requested by

the European regulatory authority or remedies the breach reported by

the said European regulatory authority.

(3) The competent authority shall communicate the nature of

any measures taken against the Maltese management company in

terms of sub-regulation (2) to the European regulatory authority

concerned.

(4) Where a Maltese management company continues to

refuse to provide the information requested by the European

regulatory authority in the host Member State or EEA State or persists

in its breaches of legal or regulatory rules despite the measures taken

by the competent authority or due to the inadequacy or unavailability

of such measures in Malta, the competent authority shall be notified

of any measures taken by the European regulatory authority of the

host Member State or EEA State against the Maltese management

company.

(5) The competent authority shall consult the European

regulatory authority of the host Member State or EEA State before

withdrawing the licence of the Maltese management company in

accordance with the provisions of this regulation.

FREEDOM OF ESTABLISHMENT AND FREEDOM TO

PROVIDE SERVICES BY EUROPEAN MANAGEMENT

COMPANIES

(1)

Where a European management company wishes to Freedom of

establish a branch in Malta, the following conditions shall be establishment

European

complied with

management

companies -

branch.

(a)

the European management company has provided

the European regulatory authority in its home Member State or

EEA State with the following documentation

(i) a notification of its intention to establish a

branch in Malta;

(ii) a programme of operations identifying the

activities and services which the European management

company seeks to carry on through the branch in Malta and

the proposed organisational structure of the branch,

including a description of the risk management process

implemented by the European management company and a

description of the procedures and arrangements

implemented to ensure a suitable investor complaints

procedure in terms of Article 15 of the UCITS Directive;

(iii) the address of the proposed branch in the

territory of Malta from where documents may be obtained;

(iv) the names of those responsible for the

management of the branch;

(b)

the competent authority has received from the

European regulatory authority of the home Member State or

EEA State of the European management company

(i)

the information in paragraph (a);

(ii) details of any compensation scheme of which

the European management company is a member and

which is intended to protect investors;

(iii) where the European management company

wishes to pursue the activity of collective portfolio

management in terms of Annex II of the UCITS Directive,

an attestation that the European management company has

been so authorised pursuant to the provisions of the UCITS

Directive, a description of the scope of the authorisation of

the European management company and details of any

restriction on the types of UCITS that the European

management company is authorised to manage.

(2) A European management company pursuing activities

through a branch within the territory of Malta shall comply with the

provisions of the Investment Services Rules on conduct of business,

and the competent authority shall be responsible for supervising

compliance thereof.

(3) A branch of a European management company shall not

commence business in Malta unless

(a)

it has been informed by the competent authority of

the applicable provisions in force in accordance with sub-

regulation (1) and that it may establish the branch in Malta; or

(b)

two months have elapsed from the date of receipt

by the competent authority of the information and the

documents referred to in sub-regulation (2) by the European

authority in the home Member State or EEA State of the

European management company.

(4) Where the European management company plans a change

in any of the particulars referred to in sub-regulation (1)(a)(ii) to (iv),

it shall give written notice of that change to the competent authority

not less than one month prior to the implementation of such change,

and the provisions of sub-regulation (3) shall apply.

(5) In the event of a change to any of the particulars notified to

the competent authority in accordance with sub-regulation (1)(a) and

(b)(ii), the competent authority shall receive notification thereof from

the European regulatory authority of the home Member State or EEA

State of the European management company.

(6) The competent authority shall be notified by the European

regulatory authority of the European management company home

Member State or EEA State whenever there is a change in the scope

of the authorisation of the European management company or in the

details of any restriction on the types of UCITS that a European

management company is authorised to manage.

(1)

Where a European management company wishes to

exercise the right to provide services in Malta for the first time, the

following service conditions shall be complied with

(a)

the European management company has provided

the European regulatory authority of its home Member State or

EEA State with the following documentation

(i) a notification of its intention to provide

services in Malta;

(ii) a programme of operations stating the

activities and services envisaged, including a description

of the risk management process implemented by the

European management company and a description of the

procedures and arrangements implemented pursuant to

Article 15 of the UCITS Directive;

(b)

the competent authority has received from the

European regulatory authority of the home Member State or

EEA State of the European management company

(i)

the information in paragraph (a); and

(ii) details of any applicable compensation

scheme intended to protect investors.

(2) Where a European management company wishes to pursue

the activity of collective portfolio management as referred to in

Annex II of the UCITS Directive, the European regulatory authority

of the home Member State or EEA State of the European management

company shall enclose with the documentation and information

notified to the competent authority in accordance with sub-regulation

(1) an attestation that the European management company has been

authorised, a description of the scope of the authorisation of the

European management company and details of any restriction on the

types of UCITS that such company is authorised to manage.

(3) The European management company may commence to

provide the service or services in respect of which it wishes to

exercise the right to provide services in Malta upon receipt by the

competent authority of all the documentation required in terms of

sub-regulation (1).

(4) Where the content of the information communicated in

accordance with sub-regulation (1)(a)(ii) is amended, a European

management company shall give prior written notice of such

amendment to the competent authority.

(5) The competent authority shall be informed by the

European regulatory authority of the home Member State or EEA

State of the European management company whenever there is a

change in the scope of the authorisation of a European management

company or in the details of any restriction on the types of UCITS

that a European management company is authorised to manage.

(1)

A European management company which pursues

the activity of collective portfolio management of a Maltese UCITS

on a cross-border basis by establishing a branch in Malta or in

exercise of the freedom to provide services shall comply with the Act,

any applicable regulations and the Investment Services Rules, and in

particular such European management company shall comply with

the requirements applicable to

(a)

the setting up and licencing of the UCITS;

(b)

the issuance and redemption of units and shares;

(c)

investment policies and

limits,

including

calculation of total exposure and leverage;

(d)

restrictions on borrowing, lending and uncovered

sales;

(e)

the valuation of assets and the accounting of the

UCITS;

(f)

the calculation of the issue or redemption price and

rules regarding errors in the calculation of the net asset value

and the related investor compensation;

(g)

the distribution or reinvestment of income;

(h)

the disclosure and reporting requirements of the

UCITS, including the prospectus, the key investor information

and periodic reports;

(i)

the arrangements made for marketing;

(j)

the relationship with unit-holders;

(k)

the merging and restructuring of UCITS;

(l)

the winding up and liquidation of the UCITS;

(m)

where applicable, the content of the unit-holder

register;

(n)

the licencing and supervision fees regarding the

UCITS; and

(o)

the exercise of unit-holders’ voting rights and other

unit-holders’ rights in relation to paragraphs (a) to (m).

(2) A European management company shall comply with the

obligations set out in the prospectus and in the instruments of

incorporation of the Maltese UCITS which it wishes to manage. Such

documents shall be consistent with the requirements referred to in

sub-regulation (1).

(3) The competent authority shall be responsible for

supervising compliance of the European management company with

the requirements of sub-regulations (1) and (2).

(4) A European management company shall adopt and

implement all the arrangements and organisational decisions

necessary to ensure compliance with the applicable provisions

relating to the constitution and functioning of the Maltese UCITS.

The European management company shall also be responsible for

compliance with the obligations set out in the prospectus and in the

instruments of incorporation of the Maltese UCITS.

(5) A European management company duly authorised in its

home Member State or EEA State in terms of the UCITS Directive

shall not be subject to any additional requirements applicable in

Malta in respect of the subject matter of the UCITS Directive, except

in the cases expressly specified by the UCITS Directive.

(1)

A European management company which intends Management of

to manage a Maltese UCITS shall provide the competent authority Maltese

by European

with the following documentation

management

companies.

(a)

the written agreement with the custodian in

accordance with the applicable Investment Services Rules; and

(b)

information on the delegation arrangements

regarding the functions of investment management and

administration in accordance with the applicable Investment

Services Rules

Provided that, where a European management company already

manages other Maltese UCITS of the same type, reference to the

documentation already provided to the competent authority shall be

sufficient.

(2) The European management company shall notify any

subsequent material modifications of the documentation referred to in

sub-regulation (1) to the competent authority.

(3) In so far as necessary to ensure compliance with the rules

for which it is responsible, the competent authority may ask the

European regulatory authority of the home Member State or EEA

State of the European management company for clarifications and

information with regards to the following

(a)

the documentation referred to in sub-regulation (1);

and

(b)

on the basis of the attestation provided by the

European regulatory authority of the European management

company home Member State or EEA State pursuant to

regulations 9 and 10, information as to whether the type of

UCITS for which authorisation for management is requested

falls within the scope of the authorisation of the European

management company.

(4) The competent authority may refuse the application of a

European management company to manage a Maltese UCITS only if

(a)

the European management company does not

comply with the provisions of regulation 11;

(b)

the European management company is not

authorised by the European regulatory authority of its home

Member State or EEA State to manage the type of UCITS for

which the authorisation is being requested; or

(c)

the European management company has failed to

provide the competent authority with the documentation

referred to in sub-regulation (1).

(5) The competent authority shall consult with the European

regulatory authority of the European management company home

Member State or EEA State prior to refusing an application.

(1)

The competent authority may, for statistical

purposes, require a European management company which has

established a branch in Malta in terms of these regulations, to report

periodically on its activities in Malta.

(2) The competent authority may require a European

management company pursuing business in Malta through the

establishment of a branch or under the freedom to provide services, to

provide the information necessary for the monitoring of its

compliance with the applicable provisions for which it is responsible

in terms of the Act, any applicable regulations issued thereunder and

the Investment Services Rules.

(3) The requirements prescribed in sub-regulation (2) shall not

be more stringent than those which the competent authority would

impose on Maltese management companies for the monitoring of

their compliance with the same standards.

(4) A European management company which provides

collective portfolio management on a cross-border basis to a Maltese

UCITS pursuant to the provisions of these regulations shall ensure

that the procedures and arrangements implemented by the said

European management company pursuant to the applicable

provisions of the Investment Services Rules on investor complaints

shall be such as to enable the competent authority to obtain, directly

from the European management company, the information referred to

in this regulation.

(1)

Where a European management company which Breaches by

has a branch or provides services in Malta is in breach or is likely to European

management

breach the provisions of the Act or of any regulations or Investment companies.

Services Rules made thereunder, the competent authority shall

require, in writing, the European management company concerned to

put an end to the breach and shall inform the European regulatory

authority of the European management company home Member State

or EEA State of such request.

(2) Where the European management company concerned

refuses to provide the competent authority with the information

falling under its responsibility or fails to take the necessary steps to

put an end to the breach referred to in sub-regulation (1), the

competent authority shall inform the European regulatory authority of

the European management company home Member State or EEA

State accordingly.

(3) Where a European management company continues in its

refusal to provide information requested by the competent authority

in terms of regulation 13 or persists in its breach of legal or regulatory

requirements despite the measures taken by the European regulatory

authority of the European management company home Member State

or EEA State or due to the inadequacy or unavailability of such

measures in the said Member State or EEA State, the competent

authority may take either of the following actions

(a)

after informing the European regulatory authority

of the European management company home Member State or

EEA State, take appropriate measures, including measures

under articles 13 to 16B of the Act in order to prevent or

penalize further irregularities and, in so far as necessary, to

prevent that European management company from initiating

any further transactions in Malta; or

(b)

where it considers that the European regulatory

authority of the European management company home Member

State or EEA State has not acted adequately, refer the matter to

ESMA.

(4) The competent authority shall ensure that it is possible to

serve the legal documents necessary in order to enforce the

aforementioned measures.

(5) Where the service provided within the territory of Malta is

the management of a Maltese UCITS, the competent authority may

require the European management company to cease managing that

Maltese UCITS.

(6) The competent authority shall inform the European

regulatory authority of the European management company home

Member State or EEA State of any measures taken pursuant to sub-

regulation (3) and which involve measures and penalties or

restrictions on the activities of the European management company

concerned.

(7) Any action taken pursuant to sub-regulations (2), (3) and

(5) involving measures or penalties shall be properly justified and

communicated to the European management company concerned.

(8) In cases where following the procedure outlined in this

regulation would result in delays that could prejudice the interests of

investors and others for whom services are provided, the competent

authority may, prior to initiating such procedure, take any

precautionary measures it may deem necessary

Provided that, ESMA, the European Commission and the

European regulatory authorities of all other Member States or EEA

States concerned shall be informed of such measures as soon as

possible.

(9) The competent authority shall take all appropriate

measures to safeguard the interests of investors. Such measures may

include decisions preventing a European management company from

initiating any further transactions within the territory of Malta.

(10) A European management company shall have a right to

appeal to the Financial Services Tribunal in terms of the Act from a

decision of the competent authority to take measures in accordance

with sub-regulation (3).

The competent authority shall inform ESMA and the Notification by

European Commission of the number and type of cases of refusal in the

authority.

terms of regulations 3 and 12 and of any measures taken in

accordance with regulation 14(3) and (4).

CO-OPERATION WITH EUROPEAN REGULATORY

AUTHORITIES IN OTHER EUROPEAN MEMBER STATES

OR EEA STATES

(1)

The competent authority shall provide the Co-operation

European regulatory authorities of other Member States or EEA with

regulatory

States with all information concerning the management and authorities.

ownership of a Maltese management company which is likely to

facilitate its supervision as well as any other information which is

likely to facilitate the monitoring of such Maltese management

company. Further, the competent authority shall also cooperate with

the European regulatory authorities in other Member States or EEA

States in order to ensure that such European regulatory authorities

collect the information required in terms of regulation 13(2) to (4).

(2) The competent authority shall notify the European

regulatory authority of a UCITS home Member State or EEA State

without delay of any problems identified in a Maltese management

company which may materially affect the ability of such Maltese

management company to perform its duties properly with respect to

that UCITS or of any breach of the requirements prescribed under

these regulations.

B

€0.90