Regulations, 2021

Suppliment tal-Gazzetta tal-Gvern ta’ Malta Nru. 20,596, 26 ta’ Marzu, 2021 B 923

L.N. 118 of 2021

MALTA FINANCIAL SERVICES AUTHORITY ACT

(CAP. 330)

Malta Financial Services Authority Act (Securitisation)

Regulations, 2021

IN EXERCISE of the powers conferred by article 20A of the

Malta Financial 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 Malta Financial Citation and

scope.

Services Authority Act (Securitisation) Regulations, 2021.

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

relevant provisions of the Securitisation Regulation 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;

"Securitisation Regulation" means Regulation (EU) 2017/2402 of

the European Parliament and of the Council of 12 December 2017

laying down a general framework for securitisation and creating

specific framework for simple, transparent and standardised

securitisation, and amending Directives 2009/65/EC, 2009/138/EC

and 2011/61/EU and Regulations (EC) No 1060/2009 and (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;

"subject person" means any institutional investor, originator,

sponsor, original lender and securitisation special purpose entities

("SSPE") as defined in the Securitisation Regulation.

(2) Words and expressions used in these regulations which are

also used in the Securitisation Regulation but which are not defined

herein, shall have the same meaning assigned to them in the

Securitisation Regulation.

These regulations shall apply to subject persons involved in

securitisations.

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 Securitisation

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 in accordance with the

Securitisation Regulation.

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

authority may, for the better implementation of the Securitisation

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

The Authority may issue Rules in terms of article 16(2)(a)

and article 20A(3) of the Act for the better carrying out of these

regulations and the Securitisation Regulation.

(1) The competent authority shall exercise its supervisory

powers and its powers to impose administrative penalties and other

administrative measures, in such a way as to ensure full and complete

adherence to the requirements and obligations arising out of the Act,

any regulations issued thereunder, any Rules issued by the competent

authority and the Securitisation Regulation, either directly, in

collaboration with other authorities or by applications to the competent

judicial authorities, in terms of the law as warranted by the relevant

circumstances.

(2) The competent authority shall ensure that administrative

penalties and other administrative measures imposed on subject

persons are effectively implemented.

(3) The administrative penalties and other administrative

measures imposed on subject persons shall be effective, proportionate

and dissuasive.

(4) When determining the type of administrative penalties or

other administrative measures and the level of administrative penalties

to be imposed on subject persons, the competent authority shall take

into account the extent to which the breach is intentional or results

from negligence and all other relevant circumstances including, where

appropriate

(a)

the materiality, gravity and the duration of the breach;

(b) the degree of responsibility of the natural or legal

person responsible for the breach;

(c) the financial strength of the natural or legal person

responsible for the breach;

(d) the importance of profits gained or loses avoided by

the natural or legal person responsible for the breach insofar as

they can be determined;

(e) the losses for third parties caused by the breach

insofar as they can be determined;

(f) the level of co-operation of the natural or legal person

responsible for the breach with the competent authority;

(g) previous breaches by the natural or legal person

responsible for the breach.

(5) Where obligations imposed in terms of the Act, any

regulations issued thereunder, any Rules issued by the competent

authority or the Securitisation Regulation apply to a subject person

which is a legal person, the competent authority may impose

administrative penalties and other administrative measures on

members of the management body of such legal entity and to other

individuals who are responsible for the breach of such obligations.

Without prejudice to the powers of the competent authority Administrative

under the Act or any other law, the competent authority shall impose penalties

other

administrative penalties and other administrative measures for administrative

measures.

breaches of the Act, any regulations issued thereunder, any Rules

issued by the competent authority and the Securitisation Regulation.

(1) Without prejudice to the generality of regulation 8, Administrative

the competent authority shall impose administrative penalties and penalties

other

other administrative measures for the following breaches

administrative

measures for

breaches of the

(a) an originator, sponsor or original lender has failed to Securitisation

Regulation.

meet the requirements provided for in Article 6 of the

Securitisation Regulation;

(b) an originator, sponsor or SSPE has failed to meet the

requirements provided for in Article 7 of the Securitisation

Regulation;

(c) an originator, sponsor or original lender has failed to

meet the criteria provided for in Article 9 of the Securitisation

Regulation;

(d) an originator, sponsor or SSPE has failed to meet the

requirements provided for in Article 18 of the Securitisation

Regulation;

(e) a securitization is designated as STS and an

originator, sponsor or SSPE of that securitization has failed to

meet the requirements provided for in Articles 19 to 22 or

Articles 23 to 26 of the Securitisation Regulation;

(f) an originator or sponsor makes a misleading

notification pursuant to Article 27(1) of the Securitisation

Regulation;

(g) an originator or sponsor has failed to meet the

requirements provided for in Article 27(4) of the Securitisation

Regulation; or

(h) a third party authorized pursuant to Article 28 of the

Securitisation Regulation has failed to notify changes to the

information provided in accordance with Article 28(1) of the

Securitisation Regulation, or any other changes that could

reasonably be considered to affect the assessment of the

competent authority.

(2) Without prejudice to the generality of regulation 8, the

competent authority shall have the power to impose the following

administrative penalties and other administrative measures for the

breaches indicated in sub-regulation (1)

(a) a public statement which indicates the identity of the

natural or legal person and the nature of the infringement in

accordance with Article 37 of the Securitisation Regulation;

(b) an order requiring the natural or legal person to cease

the conduct and to desist from a repetition of that conduct;

(c) a temporary ban preventing any member of the

originator’s, sponsor’s or SSPE’s management body or any other

natural person held responsible for the infringement from

exercising management functions in such undertakings;

(d) in the case of an infringement as referred to in

paragraphs (e) and (f) of sub-regulation (1) a temporary ban

preventing the originator and sponsor from notifying under

Article 27(1) that a securitisation meets the requirements set out

in Articles 19 to 22 or Articles 23 to 26 of the Securitisation

Regulation;

(e) in the case of a natural person, administrative

penalties of up to five million euro (€5,000,000);

(f) in the case of a legal person, administrative penalties

of up to five million euro (€5,000,000) or of up to 10% of the

total annual net turnover of the legal person according to the last

available audited accounts approved by the management body;

where the legal person is a parent undertaking or a subsidiary of

the parent undertaking which has to prepare consolidated

financial accounts in accordance with Directive 2013/34/EU of

the European Parliament and of the Council, the relevant total

annual net turnover shall be the total net annual turnover or the

corresponding type of income in accordance with the relevant

accounting legislative acts according to the last available

consolidated accounts approved by the management body of the

ultimate parent undertaking;

(g) administrative penalties of at least twice the amount

of the benefit derived from the infringement where that benefit

can be determined, even if that exceeds the maximum amounts in

paragraphs (e) and (f) of this sub-regulation;

(h) in the case of an infringement as referred to in

paragraph (h) of sub-regulation (1), a temporary withdrawal of

the authorisation referred to in Article 28 for the third party

authorised to check the compliance of a securitisation with

Articles 19 to 22 or Articles 23 to 26 of the Securitisation

Regulation.

(1) The competent authority shall publish any decision Publication of

imposing an administrative penalty or any other administrative the

the competent

measure for breaches of the provisions of the Act, any regulations authority.

issued thereunder, any Rules issued by the competent authority and the

Securitisation Regulation from which there is no appeal on its website

without undue delay after the person on whom the penalty or measure

was imposed has been informed of that decision. The publication

referred to in this sub-regulation shall include at least information on

the type and nature of the breach and the identity of the persons

responsible.

(2) Where the publication of the identity of the legal persons or

of the personal data of the natural persons is considered by the

competent authority to be disproportionate following a case-by-case

assessment, or where the competent authority considers that the

publication jeopardises the stability of the financial markets or an

ongoing investigation, or where the publications would cause, insofar

as can be determined, disproportionate damages to the person

involved, the competent authority shall either

(a) defer the publication of the decision to impose the

administrative penalty or any other administrative measure until

the reasons for non-publication cease to exist;

(b) publish the decision to impose the administrative

penalty or any other administrative measure on an anonymous

basis in a manner which complies with Maltese law; or

(c) not publish the decision to impose an administrative

penalty or any other administrative measure in the event that the

options laid down in paragraphs (a) and (b) are considered to be

insufficient to ensure

(i) that the stability of the financial markets would

not be put in jeopardy;

(ii) the proportionality of the publication of such

decisions with regard to measures which are deemed to be

of a minor nature.

(3) In the case of a decision to publish an administrative

penalty or any other administrative measure on an anonymous basis,

the publication of the relevant data may be postponed.

(4) Where the decision to impose an administrative penalty or

any other administrative measure is subject to appeal before the

relevant judicial or other authorities, the competent authority shall also

publish immediately on its website such information and any

subsequent information on the outcome of such an appeal. Any

decision annulling a previous decision to impose an administrative

penalty or any other administrative measure shall also be published.

(5) The competent authority shall ensure that any publication

in accordance with this regulation shall remain on its official website

for a period of at least five years from its publication

Provided that personal data contained in the publication

shall be kept on the official website of the competent authority only for

the period which is necessary in accordance with the applicable data

protection legislation.

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 Act shall

mutatis mutandis apply.

€0.27