Credit Institutions (Reorganisation and Winding-Up)

L.N. 298 of 2015

BANKING ACT

(CAP. 371)

Credit Institutions (Reorganisation and Winding-Up)

(Amendment) Regulations, 2015

IN exercise of the powers conferred by article 3(1) of the

Banking Act, the Minister for Finance, after consultation with the

Malta Financial Services Authority, has made the following

regulations:-

The title of these regulations is the Credit Institutions Citation.

(Reorganisation and Winding-Up) (Amendment) Regulations, 2015

and these regulations shall be read and construed as one with the

Credit Institutions (Reorganisation and Winding-Up) Regulations, S.L. 371.12

hereinafter referred to as "the principal regulations".

Regulation 2 of the principal regulations shall be amended Amends

regulation 2 of

as follows

the principal

regulations.

(a) sub-regulation (1) thereof shall be substituted by the

following

"(1) These regulations apply to Maltese credit

institutions and their branches located in other Member

States or EEA States and Part IV of these regulations

applies to branches present in Malta of credit institutions

authorised in another Member State. These regulations

shall not apply to those branches of credit institutions that

are situated in a Member State or an EEA State in which

they have their head offices.";

(b) sub-regulations (2), (3) and (4) thereof shall be

renumbered as sub-regulations (3), (4) and (5) respectively;

(c)

immediately after sub-regulation (1) thereof there

shall be added the following new sub-regulation

"(2) In the event of application of the resolution

tools and exercise of the resolution powers provided for in

the Act and any relevant regulations made thereunder

transposing the BRRD, these regulations shall also apply

to the financial institutions, firms and parent undertakings

falling within the scope of the BRRD in the event of

application of the resolution tools and exercise of the

resolution powers provided for in the said Directive."; and

(d) immediately after sub-regulation (5) thereof, as re-

numbered, there shall be added the following new sub-

regulation

"(6) These regulations shall only apply to

reorganisation measures or winding-up proceedings

adopted immediately after the date of coming into force of

these regulations.".

Regulation 3 of the principal regulations shall be amended

as follows

(a) immediately after the definition "the Act" there shall

be added the following new definition

" "administrative or judicial authorities" means

such administrative or judicial authorities in Malta that are

competent for the purposes of reorganisation measures or

winding-up proceedings;";

(b) for the definition "branch" there shall be substituted

the following

" "branch" means 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, as defined in point

(17) of Article 4(1) of the CRR;";

(c) immediately after the definition "branch" there shall

be added the following new definition

" "the BRRD" means Directive 2014/59/EU of the

European Parliament and of the Council of 15 May 2014

establishing a framework for the recovery and resolution

of credit institutions and investment firms and amending

Council Directive 82/891/EEC, and Directives 2001/24/

EC, 2002/47/EC, 2004/25/EC, 2005/56/EC, 2007/36/EC,

2011/35/EU, 2012/30/EU and 2013/36/EU, and

Regulations (EU) No 1093/2010 and (EU) No 648/2012, of

the European Parliament and of the Council, as amended

from time to time, and includes any implementing

measures implementing technical standards, regulatory

technical standards, guidelines and similar measures that

have been or may be issued thereunder;";

(d)

for the definition "competent authority" there shall

be substituted the following

" "competent authority" means the Malta

Financial Services Authority established by the

Malta Financial Services Authority Act, or, as

the case may be, the Resolution Committee

established by the Malta Financial Services

Authority Act with respect to reorganisation

measures taken pursuant to the BRRD and to the

said Act;";

(e)

for the definition "credit institution" there shall be

substituted the following

" "credit institution" means an undertaking the

business of which is to take deposits or other repayable

funds from the public and to grant credits for its own

account, as defined in point (1) of Article 4(1) of the

CRR;";

(f)

immediately after the definition "credit institution"

there shall be added the following new definitions

" "the CRD" means Directive 2013/36/EU of the

European Parliament and of the Council of 26 June 2013

on the access to the activity of credit institutions and the

prudential supervision of credit institutions and investment

firms, amending Directive 2002/87/EC and repealing

Directives 2006/48/EC and 2006/49/EC, as amended from

time to time, and includes any implementing measures that

have been or may be issued thereunder;

''the CRR'' means Regulation (EU) No 575/2013 of

the European Parliament and of the Council of 26 June

2013 on prudential requirements for credit institutions and

investment firms and amending Regulation (EU) No 648/

2012, as amended from time to time, and includes any

implementing measures that have been or may be issued

thereunder.";

(g) immediately after the definition "European Credit

Institution" there shall be added the following new definition

" "financial institution" shall have the same

meaning as that assigned to it in point (26) of Article 4(1)

of the CRR;";

(h) for the definition "home state" there shall be

substituted the following

" "home Member State" shall mean the Member

State or EEA State in which the credit institution has been

granted a licence, as defined in point (43) of Article 4(1) of

the CRR;";

(i)

for the definition "host state" there shall be

substituted the following

" "host Member State" shall mean the Member

State or EEA State other than the home State in which a

credit institution has a branch or in which it provides

services, as defined in point (44) of Article 4(1) of the

CRR;";

(j)

for the definition "instruments" there shall be

substituted the following

" "instrument" means any instrument,

contract or right falling within the Second

Schedule to the Investment Services Act and

whether or not issued in Malta;";

(k) for the definition "Member State" there shall be

substituted the following

" "Member State" means a member of the European

Union;";

(l)

immediately after the definition "Member State"

there shall be added the following new definition

" "parent undertaking" shall have the same

meaning as that assigned to it in point (15) of Article 4(1)

of the CRR;";

(m) for the definition "regulated market" there shall be

substituted the following

" "regulated market" shall have the same

meaning as that assigned to it in article 2(1) of

the Financial Markets Act ;";

(n) for the definition "reorganisation measures" there

shall be substituted the following

" "reorganisation measures” means measures 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 or reduction of claims; those

measures include the application of the resolution tools

and the exercise of resolution powers provided for in the

BRRD;"; and

(o) for the definition "winding-up proceedings" there

shall be substituted the following

" "winding-up proceedings" means collective

proceedings opened and monitored by the administrative

or judicial authorities of Malta with the aim of realising

assets under the supervision of those authorities, including

where the proceedings are terminated by a composition or

other similar measure;".

In sub-regulation (3) of regulation 5 of the principal Amends

regulations, for the words "including the possible practical effects of regulation

the principal

such measures.", there shall be substituted the words "including the regulations.

possible practical effects which such a measure may have, before it is

adopted or otherwise immediately thereafter:", and immediately

thereafter there shall be added the following new proviso

"Provided that this sub-regulation shall not

apply where regulation 83 of the Recovery and

L.N. xxxx of

2015. Resolution Regulations, 2015 applies, and

accordingly the foreign authority shall be

informed by the Resolution Committee in terms

of such regulations.".

In sub-regulation (1) of regulation 6 of the principal Amends

regulations, for the words "reorganisation measures on a branch regulation

the principal

present in Malta of a European credit institution,", there shall be regulations.

substituted the words "reorganisation measures on a branch of a

Maltese credit institution situated in another Member State or an EEA

State,".

In sub-regulation (1) of regulation 8 of the principal Amends

regulations, for the words "as well as details regarding the regulation

the principal

information requested in this regulation.", there shall be substituted regulations.

the words, "as well as details regarding the information requested in

this regulation:", and immediately thereafter there shall be added the

following new proviso

"Provided that this sub-regulation shall not

apply where regulation 83 of the Recovery and

L.N. xxxx of

2015. Resolution Regulations, 2015 applies.".

In sub-regulation (3) of regulation 9 of the principal

regulations, for the words "Article 11 of Directive 200012EC and

published each year in the Official Journal of the European

Communities", there shall be substituted the words "Article 20 of the

CRD and published each year in the Official Journal of the European

Union.".

In sub-regulation (3) of regulation 19 of the principal

regulations, for the words "Article 11 of Directive 200012EC and

published each year in the Official Journal of the European

Communities", there shall be substituted the words "Article 20 of the

CRD and published each year in the Official Journal of the European

Union.".

Regulation 27 of the principal regulations shall be

substituted by the following

" Netting

Pursuant to the provisions of the Set-

agreements.

Off and Netting on Insolvency Act, and without

prejudice to regulations 68 and 71 of the

Recovery and Resolution Regulations, 2015,

L.N. xxxx of

2015. netting agreements shall be governed solely by

the law of the contract which governs such

agreements.".

10. Regulation 28 of the principal regulations shall be

substituted by the following

" Repurchase

Without prejudice to regulations 68

agreements.

and 71 of the Recovery and Resolution

L.N. xxxx of

Regulations, 2015, and to regulation 26 of these

2015. regulations, repurchase agreements shall be

governed solely by the law of the contract which

governs such agreements.".

11. In regulation 35 of the principal regulations, for the words

"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.", there shall be

substituted the words "in accordance with the rules and conditions

laid down in the Banking Act, the Malta Financial Services Authority

Act and the Banking Act (Supervisory Review) Regulations, with the

exception of any judicial authorities to which existing national

provisions apply:", and immediately thereafter there shall be added

the following new proviso

"Provided that this regulation shall not

apply where regulation 84 of the Recovery and

L.N. xxxx of

2015. Resolution Regulations, 2015, applies, and

accordingly the confidentiality provisions of

such regulations shall apply.".

12. Regulation 37 of the principal regulations shall be Substitutes

regulation 37 of

substituted by the following

the principal

regulations.

" Maltese

(1)

From the date of coming into

credit

force of these regulations, the Court may not, in

institutions or

relation to a Maltese credit institution or any

branches of

Maltese credit

branch of a Maltese credit institution located in

institutions

located in

another Member State or EEA State -

another

(a)

make a winding-up order

Member State

or EEA State.

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) Sub-regulation (1)(a) does not

prevent -

(a)

the Court from making a

winding-up order after the coming into

force of these regulations in relation to a

Maltese credit institution or any branch of a

Maltese credit institution located in another

Member State or EEA State if -

(i) a

provisional

administrator was appointed in

relation to the Maltese credit

institution or a branch of a Maltese

credit institution located in another

Member State or EEA State before the

coming

into

force

of

these

regulations, and

(ii) the

appointment

continues in force until immediately

before that winding-up order is made;

(b) the winding-up of a Maltese

credit institution or a branch of a Maltese

credit institution located in another

Member State or EEA State after the

coming into force of these regulations

pursuant to a winding-up order which was

made, and has not been discharged, before

that date.

(3) Sub-regulation (1)(b) does not

prevent a provisional administrator of a Maltese

credit institution or a branch of a Maltese credit

institution located in another Member State or

EEA State appointed before the coming into

force of these regulations 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 1st May, 2004.".

13. Part VI - Transitional Provisions, including regulation 39,

Deletes Part VI

- Transitional

of the principal regulations shall be deleted.

Provisions and

regulation 39 of

the principal

regulations.

€0.72