securities financing transactions and of reuse) Regulations, 2017

Suppliment tal-Gazzetta tal-Gvern ta’ Malta Nru. 19,736, 7 ta’ Marzu, 2017

L.N. 78 of 2017

MALTA FINANCIAL SERVICES AUTHORITY ACT

(CAP. 330)

Malta Financial Services Authority Act (Transparency of

securities financing transactions and of reuse) Regulations, 2017

IN exercise of the powers conferred by article 20A of the Malta

Financial Services Authority 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 Malta Financial Citation and

Services Authority Act (Transparency of securities financing scope.

transactions and of reuse) Regulations, 2017.

(2) The purpose of these regulations is to lay down rules on

the transparency of securities financing transactions and of reuse, and

to implement the relevant provisions of the SFTR as herein defined,

and they shall be interpreted and applied accordingly.

(1)

In these regulations, unless the context otherwise Interpretation.

requires

"the Act" means the Malta Financial Services Authority Act;

"branch" means a place of business other than the head office

which is part of a counterparty and which has no legal personality;

"buy-sell back transaction" or "sell-buy back transaction" means

a transaction by which a counterparty buys or sells securities,

commodities, or guaranteed rights relating to title to securities or

commodities, agreeing, respectively, to sell or to buy back securities,

commodities or such guaranteed rights of the same description at a

specified price on a future date, that transaction being a buy-sell back

transaction for the counterparty buying the securities, commodities or

guaranteed rights, and a sell-buy back transaction for the counterparty

selling them, such buy-sell back transaction or sell-buy back

transaction not being governed by a repurchase agreement or by a

reverse-repurchase agreement within the meaning of a repurchase

transaction;

"counterparties" means financial counterparties and non-

financial counterparties;

"established" means

(a)

if the counterparty is a natural person, where it has

its head office;

(b) if the counterparty is a legal person, where it has its

registered office;

(c)

if the counterparty has, under its national law, no

registered office, where it has its head office;

"financial counterparty" means

(a)

an investment firm authorised in accordance with

Directive 2014/65/EU of the European Parliament and of the

Council;

(b) a credit institution authorised in accordance with

Directive 2013/36/EU of the European Parliament and of the

Council or with Regulation (EU) No 1024/2013;

(c)

an insurance undertaking or a reinsurance

undertaking authorised in accordance with Directive 2009/138/

EC of the European Parliament and of the Council;

(d) a UCITS and, where relevant, its management

company, authorised in accordance with Directive 2009/65/EC;

(e)

an AIF managed by AIFMs authorised or registered

in accordance with Directive 2011/61/EU;

(f)

an institution for occupational retirement provision

authorised or registered in accordance with Directive 2003/41/

EC of the European Parliament and of the Council;

(g) a central counterparty authorised in accordance with

Regulation (EU) No 648/2012;

(h) a central securities depository authorised

in

accordance with Regulation (EU) No 909/2014;

(i)

a third-country entity which would require

authorisation or registration in accordance with the legislative

acts referred to in points (a) to (h) if it were established in the

Union;

"Financial Services Tribunal" means the Tribunal established in

terms of article 21 of the Act;

"margin lending transaction" means a transaction in which a

counterparty extends credit in connection with the purchase, sale,

carrying or trading of securities, but not including other loans that are

secured by collateral in the form of securities;

"non-financial counterparty" means an undertaking established

in the Union or in a third country other than entities falling under the

definition of a financial counterparty ;

"repurchase transaction" means a transaction governed by an

agreement by which a counterparty transfers securities, commodities,

or guaranteed rights relating to title to securities or commodities

where that guarantee is issued by a recognised exchange which holds

the rights to the securities or commodities and the agreement does not

allow a counterparty to transfer or pledge a particular security or

commodity to more than one counterparty at a time, subject to a

commitment to repurchase them, or substituted securities or

commodities of the same description at a specified price on a future

date specified, or to be specified, by the transferor, being a repurchase

agreement for the counterparty selling the securities or commodities

and a reverse repurchase agreement for the counterparty buying them;

"reuse" means the use by a receiving counterparty, in its own

name and on its own account or on the account of another

counterparty, including any natural person, of financial instruments

received under a collateral arrangement, such use comprising transfer

of title or exercise of a right of use in accordance with Article 5 of

Directive 2002/47/EC but not including the liquidation of a financial

instrument in the event of default of the providing counterparty;

"securities or commodities lending" or "securities or

commodities borrowing" means a transaction by which a counterparty

transfers securities or commodities subject to a commitment that the

borrower will return equivalent securities or commodities on a future

date or when requested to do so by the transferor, that transaction

being considered as securities or commodities lending for the

counterparty transferring the securities or commodities and being

considered as securities or commodities borrowing for the

counterparty to which they are transferred;

"securities financing transaction" or "SFT" means

(a)

a repurchase transaction;

(b) securities or commodities lending and securities or

commodities borrowing;

(c)

a buy-sell back transaction or sell-buy back

transaction;

(d)

a margin lending transaction;

"SFTR" means Regulation (EU) 2015/2365 of the European

Parliament and of the Council of the 25 November, 2015 on

transparency of securities financing transactions and of reuse and

amending Regulation (EU) No 648/2012, as may be amended from

time to time.

(2) Words and expressions used in these regulations shall have

the same meaning as is assigned to them in the Act unless otherwise

defined herein.

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

provisions of the SFTR, the latter shall prevail.

The Malta Financial Services Authority established by the

Act shall be the designated competent authority in Malta for the

purposes of implementing the relevant provisions of the SFTR, 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 SFTR.

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

the competent authority may, for the better implementation of the

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

relation to

(a)

a counterparty to an SFT that is established

(i) in Malta, including all

its

branches

irrespective of where they are located;

(ii) in a third country, if the SFT is concluded in

the course of the operations of a branch in Malta of that

counterparty;

(b) management companies of undertakings for UCITS

and UCITS investment companies in accordance with Directive

2009/65/EC;

(c)

AIFMs authorized in accordance with Directive

2011/61/EU;

(d)

a counterparty engaged in reuse that is established

(i) in Malta, including all

its

branches

irrespective of where they are located;

(ii) in a third country, where either, the reuse is

effected in the course of operations of a branch in Malta of

that counterparty, or the reuse concerns financial

instruments provided under a collateral arrangement by a

counterparty established in Malta or a branch in Malta of a

counterparty established in a third country.

B

€0.27