Regulations, 2014

Suppliment tal-Gazzetta tal-Gvern ta’ Malta, Nru. 19,245, 2 ta’ Mejju, 2014 B 1177

L.N. 145 of 2014

BANKING ACT

(CAP. 371)

Banking Act (Access to Emissions Allowance Auction)

Regulations, 2014

IN exercise of the powers conferred by article 3(2) of the

Banking Act, the Minister for Finance, acting on the advice of the

Malta Financial Services Authority, has made the following

regulations:-

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

scope.

(Access to Emissions Allowance Auction) Regulations, 2014.

(2) The purpose of these regulations is to implement Articles

18(1)(c), 18(3) and 59 of the Auctioning Regulation.

(1)

In these regulations, unless the context otherwise Interpretation.

requires -

"the Act" means the Banking Act;

"Auctioning Regulation" means Commission Regulation (EU)

No 1031/2010 of 12 November 2010 on the timing, administration

and other aspects of auctioning of greenhouse gas emission

allowances pursuant to Directive 2003/87/EC of the European

Parliament and of the Council establishing a scheme for greenhouse

gas emission allowances trading within the Community, as may be

amended from time to time;

"auctions" means the auctioning of emission allowances held in

accordance with the Auctioning Regulation;

"credit institution" shall have the same meaning as is assigned to

it under the Act and shall only include an institution which is not a

holder of an Investment Services Licence issued under the Investment Cap. 370.

Services Act;

"financial instruments" means the instruments listed in the

Second Schedule to the Investment Services Act.

(2) Words and expressions used in the Act shall, in these

regulations, have the same meaning as that assigned to them in the

Act.

The Malta Financial Services Authority established by the

Malta Financial Services Authority Act shall be the designated

competent authority in Malta for the purposes of implementing the

relevant provisions of the Auctioning Regulation, and any reference

in these regulations to the competent authority shall be read and

construed accordingly.

(1) The competent authority shall exercise all the

functions, obligations and powers and shall satisfy all the

requirements imposed on competent authorities by the Auctioning

Regulation.

(2) Without prejudice to sub-regulation (1), the competent

authority may, for the better implementation of the Auctioning

Regulation, exercise any of the powers assigned to it under the Act in

relation to persons engaged in bidding in emission allowance

auctions.

For the better carrying out of the provisions of the

Auctioning Regulation and of these regulations, the competent

authority may, from time to time, issue and publish Rules which shall

be binding on all credit institutions which are engaged in bidding in

auctions. Such rules may lay down additional requirements and

conditions, and any other matters as the competent authority may

consider appropriate including

(a)

the operation of the Auctioning Regulation or of

these regulations;

(b) any matter relating to the functions, obligations and

powers of the competent authority under the Auctioning

Regulation; and

(c)

any other matter arising in connection with the

Auctioning Regulation or these regulations.

A credit institution shall be eligible to apply for admission

to bid directly in emission allowance auctions on behalf of its clients

when such bidding is for products that are not financial instruments,

on the condition that it is authorised by the competent authority in

terms of these regulations.

An application for authorisation in terms of regulation 6

shall be made to the competent authority in writing and shall be

accompanied by such documents as the competent authority may

specify.

(1)

The

competent

authority

shall

not

grant

authorisation in terms of these regulations unless the applicant

(a)

is of sufficient good repute and sufficiently

experienced as to ensure proper respect of the conduct rules

provided for in the Rules issued by the competent authority for

this purpose;

(b) has in place the necessary processes and checks to

manage conflicts of interest and serve the best interests of its

clients;

(c)

complies with the requirements of the Prevention of S.L. 373.01

Money Laundering and Funding of Terrorism Regulations, and

any regulations and guidance notes issued thereunder; and

(d) complies with any other measures deemed necessary

having regard to the nature of the bidding services being offered

and the level of sophistication of the clients in terms of its

investor or trading profile as well as any risk-based assessment

of the likelihood of money laundering, terrorist financing or

criminal activity.

The competent authority may withdraw an authorisation Withdrawal of

authorisation.

granted in terms of these regulations where

(a)

the holder thereof no longer fulfils the conditions of

authorisation or has contravened any of the conditions of

authorisation;

(b) the holder thereof, or a person acting on its behalf,

has furnished the competent authority with information which is

false, inaccurate or misleading;

(c)

authorisation has been obtained through false

statements or by other irregular means; or

(d) the holder thereof has seriously and systematically

infringed any Rules issued in terms of regulation 5.

Where a person contravenes any of the provisions of these Administrative

regulations, the competent authority may, by notice in writing and penalties.

without recourse to a court hearing, impose on such person an

administrative penalty not exceeding one hundred and fifty thousand

euro (€150,000).

A right of appeal to the Financial Services Tribunal shall Appeals.

lie from a decision of the competent authority to

(a)

reject an application for authorisation made in terms

of these regulations;

(b)

withdraw an authorisation in terms of regulation 9;

or

(c)

impose a penalty in terms of regulation 10.

€0.18