Central Counterparties Access Regulations, 2017

Suppliment tal-Gazzetta tal-Gvern ta’ Malta Nru. 19,925, 22 ta’ Diċembru, 2017

Taqsima B

L.N. 387 of 2017

FINANCIAL MARKETS ACT

(CAP. 345)

INVESTMENT SERVICES ACT

(CAP. 370)

Central Counterparties Access Regulations, 2017

IN EXERCISE of the powers conferred by article 49 of the

Financial Markets Act and article 12 of the Investment Services Act,

the Minister responsible for the regulation of financial services,

acting on the advice of the Malta Financial Services Authority, has

made the following regulations

(1)

The title of these regulations is the Central Title, scope and

commencement.

Counterparties Access Regulations, 2017.

(2) The purpose of these regulations is to transpose and

implement Article 4(1)(51), and Articles 37 and 38 of MIFID as

herein defined, and they shall be interpreted and applied accordingly.

(3) These regulations shall come into force on the 3rd January

2018.

(1)

In these regulations unless the context otherwise Definitions.

requires

"the Acts" means the Financial Markets Act and the Cap. 370.

Investment Services Act;

"Central Bank of Malta" means the bank established by

article 3 of the Central Bank of Malta Act;

"central counterparty" or "CCP" means a legal person that

interposes itself between the counterparties to the contracts

traded on one or more financial markets, becoming the buyer to

every seller and the seller to every buyer;

"EMIR Regulation" means Regulation (EU) No 648/2012

of the European Parliament and of the Council of the 4th July,

2012 on OTC derivatives, central counterparties and trade

repositories, as amended from time to time;

"investment firm" means any person, other than persons to

whom MiFID does not apply in terms of Article 2 of the said

directive, whose regular occupation or business is the provision

of any one or more core investment services to third parties on a

professional basis;

"Maltese investment firm" means a person licensed in

terms of the Act, whose head office is in Malta and who is

entitled to carry on an activity in a Member State or EEA State

other than Malta in exercise of a European right;

"MiFID" means Directive 2014/65/EU of the European

Parliament and of the Council of 15 May 2014 on markets in

financial instruments and amending Directive 2002/92/EC and

Directive 2011/61/EU, as amended from time to time, and

includes any implementing measures that have been or may be

issued thereunder.

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

regulations, have the same meaning as is assigned to them in the Acts.

(1) Without prejudice to Titles III, IV or V of the EMIR

Regulation, investment firms, market operators operating an MTF

and regulated markets from Member States or EEA States other than

Malta shall have the right of direct and indirect access to CCP,

clearing and settlement systems in Malta for the purposes of

finalising or arranging the finalisation of transactions in financial

instruments.

(2) The direct and indirect access of the investment firms,

market operators operating an MTF and regulated markets referred to

in sub-regulation (1) to such facilities shall be subject to the same

non-discriminatory, transparent and objective criteria which apply to

local members or participants.

(3) The use of the facilities referred to in sub-regulation (1) to

the clearing and settlement of transactions in financial instruments

undertaken on a trading venue in Malta shall not be restricted.

(4) Regulated markets shall offer, in Malta, the right to

designate the system for the settlement of transactions in financial

instruments undertaken on that regulated market to all their members

or participants, subject to the following conditions

(a)

such links and arrangements between the

designated settlement system and any other system or facility as

are necessary to ensure the efficient and economic settlement of

the transaction in question;

(b)

agreement

by

the

competent

authority

that

technical conditions for settlement of transactions concluded on

the regulated market through a settlement system other than that

designated by the regulated market are such as to allow the

smooth and orderly functioning of financial markets.

(5) Any assessment by the competent authority shall be

without prejudice to the competences of the Central Bank of Malta as

overseer of settlement systems. The competent authority shall take

into account the oversight and, or supervision of the clearing and

settlement system already exercised by the Central Bank of Malta as

overseer of clearing and settlement systems in order to avoid undue

duplication of control.

(1)

The competent authority shall not prevent Provisions

investment firms, market operators operating an MTF and regulated regarding

clearing and

markets from Member States or EEA States other than Malta from settlement

arrangements in

entering into appropriate arrangements with a CCP or clearing house respect of EU or

and a settlement system in Malta with a view to providing for the EEA

firms, market

clearing and, or settlement of some or all trades concluded by the operators

operating an

members or participants under their systems.

MTF, and

regulated

markets.

(2) The European regulatory authority shall take into account

the oversight and, or supervision of the clearing and settlement

system already exercised by the Central Bank of Malta and other

central banks as overseers of clearing and settlement systems in order

to avoid undue duplication of control.

(1)

Maltese investment firms, market operators Access to

operating an MTF and regulated markets shall not be prevented from European

clearing and

entering into appropriate arrangements with a CCP or clearing house settlement

facilities.

and a settlement system of another Member State or an EEA State

with a view to providing for the clearing and, or settlement of some or

all trades concluded by the members or participants under their

systems.

(2) The competent authority may not oppose the use of CCP,

clearing houses and, or settlement systems in another Member State

or EEA State except where demonstrably necessary in order to

maintain the orderly functioning of that regulated market or MTF and

taking into account the conditions for settlement systems established

in regulation 3(4).

(3) The competent authority shall take into account the

oversight and, or supervision of the clearing and settlement system

already exercised by the Central Bank of Malta and other central

banks as overseers of clearing and settlement systems in order to

avoid undue duplication of control

(1)

Where a person falling within the scope of these

regulations fails to comply with any provisions of such regulations or

any rules issued thereunder further implementing such regulations,

the competent authority may, by notice in writing and without

recourse to a court hearing, impose on such person an administrative

penalty and other administrative measures in accordance with the

provisions of the Financial Markets Act (MiFID and MiFIR

Administrative Penalties, Measures and Investigatory Powers)

Regulations, 2017 or the Investment Services Act and Banking Act

(MiFID and MiFIR Administrative Penalties, Measures and

Investigatory Powers) Regulations, 2017.

(2) A right of appeal to the Financial Services Tribunal shall

lie from the decisions which the competent authority shall take under

these regulations and the provisions of Part VI of the Financial

Markets Act or Article 19 of the Investment Services Act shall apply

mutatis mutandis.

€0.18