Recovery and Resolution (Amendment) Regulations, 2024

Suppliment tal-Gazzetta tal-Gvern ta’ Malta, Nru. 21,255, 4 ta’ Ġunju, 2024

L.N. 129 of 2024

MALTA FINANCIAL SERVICES AUTHORITY ACT

(CAP. 330)

Recovery and Resolution (Amendment) Regulations, 2024

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

of the Malta Financial Services Authority Act, the Minister

responsible for the regulation of financial services, acting on the

advice of the Malta Financial Services Authority and of the Resolution

Authority, has made the following regulations

(1) The title of these regulations is the Recovery and Citation and

Resolution (Amendment) Regulations, 2024 and they shall be read and Scope.

construed as one with the Recovery and Resolution Regulations,

hereinafter referred to as the "the principal regulations".

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

relevant provisions of Article 2 of Regulation (EU) 2022/2036 of the

European Parliament and of the Council of 19 October 2022 amending

Regulation (EU) No 575/2013 and Directive 2014/59/EU as regards

the prudential treatment of global systemically important institutions

with a multiple-point-of-entry resolution strategy and methods for the

indirect subscription of instruments eligible for meeting the minimum

requirement for own funds and eligible liabilities; and transpose the

relevant provisions of Article 1 and Article 3 of Directive (EU) 2019/

879 of the European Parliament and of the Council of 20 May 2019

amending Directive 2014/59/EU as regards the loss-absorbing and

recapitalisation capacity of credit institutions and investment firms and

Directive 98/26/EC.

Regulation 44A of the principal regulations shall be Amends

regulation 44A

amended as follows

of the principal

regulations.

(a)

sub-regulation (2) thereof shall be substituted by the

following new sub-regulation

"(2) Where the conditions laid down in sub-

regulation (1) are fulfilled and the financial instrument

portfolio of such retail client does not, at the time of the

purchase, exceed five hundred thousand euro

(€500,000), the seller shall, on the basis of the

information provided by the retail client in accordance

with sub-regulation (3), ensure that both of the

following conditions are met at the time of the

purchase

(a) the retail client does not invest an

aggregate amount exceeding 10% of that client’s

financial instrument portfolio in liabilities

referred to in sub-regulation (1); and

(b) that initial investment amount invested

in one or more liabilities instruments referred to

in sub-regulation (1) is at least ten thousand euro

(€10,000).";

(b) immediately after sub-regulation (5) thereof, there

shall be added the following new sub-regulation

"(6) Where the value of total assets of the

institutions and entities referred to in paragraphs (b), (c) or

(d) of the definition "entity" which are subject to the

requirement referred to in regulation 45E does not exceed

EUR 50 billion, the only applicable requirement shall be

that set out in sub-regulation (2)(b).

Sub-regulation (4) of regulation 45D of the principal

regulations shall be substituted by the following new sub-regulation

"(4) For the purpose of regulation 45H(2),

where more than one G-SII entity, that are part of the

same G-SII, are resolution entities or third-country

entities that would be resolution entities if they were

established in the Union, the relevant European

resolution authorities shall calculate the amount

referred to in sub-regulation 3

(a) for each resolution entity or third-

country entity that would be a resolution entity if

it were established in the Union; and

(b) for each Union parent undertaking as

if it were the only resolution entity of the G-SII.".

Sub-regulation (2) of regulation 45H of the principal Amends

regulations shall be substituted by the following new sub-regulation: regulation

of the principal

regulations.

"(2) The Resolution Committee and the

European resolution authorities referred to in sub-

regulation (1) shall, where more than one G-SII entity,

that are part of the same G-SII, are resolution entities or

third-country entities that would be resolution entities if

they were established in the Union, discuss and, where

appropriate and consistent with the G-SII’s resolution

strategy, agree on

(a) the application of Article 72e of the

CRR; and

(b) any adjustment to minimise or

eliminate the difference between the sum of the

amounts referred to in paragraph (a) of regulation

45D(4) and point (a) of Article 12a of the said

CRR for individual resolution entities or third-

country entities, and the sum of the amounts

referred to in paragraph (b) of regulation 45D(4)

and point (b) of Article 12a of the said CRR

Provided that, the adjustment mentioned

above may be applied on condition that

(a) the adjustment may be applied in

respect of differences in the calculation of the

total risk exposure amounts between the relevant

Member States or third-countries by adjusting the

level of the requirement; and

(b) the adjustment shall not be applied to

eliminate differences resulting from exposures

between resolution groups

Provided further that, the sum of the

amounts referred to in paragraph (a) of regulation

45D(4) and point (a) of Article 12a of the said CRR for

individual resolution entities or third-country entities

that would be resolution entities if they were

established in the Union shall not be lower than the

sum of the amounts referred to in paragraph (b) of

regulation 45D(4) and point (b) of Article 12a of the

said CRR.".

In the second proviso of sub-regulation (1) of regulation Amends

45L of the principal regulations, the word "disturbance." shall be regulation

of the principal

substituted by the word "disturbance:" and immediately after there regulations.

shall be added the following new proviso

"Provided further that where, in accordance with sub-

regulation (1), the Resolution Committee has set a compliance

deadline ending after 1st January 2024, the application date of

regulation 45 as regards regulation 45I(3) shall be the same as

the compliance deadline.".

€0.18