Markets in Financial Instruments Regulations, 2017

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

Taqsima B

L.N. 402 of 2017

MALTA FINANCIAL SERVICES AUTHORITY ACT

(CAP. 330)

FINANCIAL MARKETS ACT

(CAP. 345)

INVESTMENT SERVICES ACT

(CAP. 370)

BANKING ACT

(CAP. 371)

Markets in Financial Instruments Regulations, 2017

IN EXERCISE of the powers conferred by article 20A of

the Malta Financial Services Authority Act, article 49 of the Financial

Markets Act, article 12 of the Investment Services Act and article 3(1)

of the Banking 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 Markets in Title scope and

commencement.

Financial Instruments Regulations, 2017.

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

relevant provisions of MiFIR as defined in regulation 2, and they shall

be interpreted and applied accordingly.

(3) These regulations shall apply to persons to whom the

provisions of MiFIR apply including credit institutions authorized

under the Banking Act, insofar as these offer structured deposits as Cap. 371.

defined herein.

(4)

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 Malta Financial Services Authority Cap. 330.

Act, the Financial Markets Act, the Investment Services Act and Cap.

345. the Banking Act;

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

Parliament and of the Council of 26 June 2013 on 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;

"deposit" means a credit balance which results from funds

left in an account or from temporary situations deriving from

normal banking transactions and which a credit institution is

required to repay under the legal and contractual conditions

applicable, including a fixed-term deposit and a savings deposit,

but excluding a credit balance where

(a) its existence can only be proven by a financial

instrument as defined in Article 4(17) of MIFID unless it is

a savings product which is evidenced by a certificate of

deposit made out to a named person and which exists in a

Member State on 2 July 2014;

(b)

its principal is not repayable at par;

(c) its principal is only repayable at par under a

particular guarantee or agreement provided by the credit

institution or a third party;

"financial instrument" means an instrument included in the

Second Schedule to the Investment Services Act;

"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;

"MiFIR" means Regulation (EU) No 600/2014 of the

European Parliament and of the Council of 15 May, 2014 on

markets in financial instruments and amending Regulation (EU)

No 648/2012, as may be 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;

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

No 648/2012 of the European Parliament and of the Council of 4

July 2012 on OTC derivatives, central counterparties and trade

repositories, as may be 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;

"structured deposit" means a deposit which is fully

repayable at maturity on terms under which interest or a

premium will be paid or is at risk, according to a formula

involving factors such as

(a) an index or combination of indices, excluding

variable rate deposits whose return is directly linked to an

interest rate index such as Euribor or Libor;

(b) a financial instrument or combination of

financial instruments;

(c) a commodity or combination of commodities or

other physical or non-physical non-fungible assets; or

(d) a foreign exchange rate or combination of

foreign exchange rates;

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

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

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

provisions of MiFIR, the latter shall prevail.

The Malta Financial Services Authority, established by the Competent

Malta Financial Services Authority Act, shall be the designated authority.

competent authority in Malta for the purposes of implementing the

relevant provisions of MiFIR, and any reference in these regulations to

the competent authority shall be read and construed accordingly.

(1) The competent authority shall exercise all the Applicability of

functions, obligations and powers and shall satisfy all the requirements MiFIR

competent

imposed on competent authorities by MiFIR.

authority.

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

authority may, for the better implementation of the MiFIR, exercise

any of the powers assigned to it under the Acts.

For the better carrying out of the provisions of MiFIR and Rules.

of these regulations, the competent authority may, from time to time,

issue and publish Financial Market Rules, Investment Services Rules

and, or Conduct of Business Rules which shall be binding on entities

which are subject to the requirements of the MIFIR. These rules may

lay down additional requirements and conditions in relation to these

matters as the competent authority may consider appropriate

including

(a) the operation of MiFIR or these regulations;

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

powers of the competent authority under MiFIR; and

(c) any other matter arising in connection with MiFIR or

these regulations.

(1) Where a person licensed or authorized in Malta, and

falling within the scope of MIFIR, fails to comply with any provisions

of that Regulation or of any Investment Services Rules and, or

Conduct of Business Rules, and, or Financial Markets Rules and, or

regulations implementing MIFIR, 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 article 21 of the Malta

Financial Services Authority Act shall apply mutatis mutandis.

€0.18