INVESTMENT SERVICES ACT (ALTERNATIVE INVESTMENT FUND MANAGER) (THIRD COUNTRY) REGULATIONS (thirdcountry)

SUBSIDIARY LEGISLATION 370.24

INVESTMENT SERVICES ACT (ALTERNATIVE INVESTMENT

FUND MANAGER)

(THIRD COUNTRY) REGULATIONS

(1) The title of these regulations is the Investment Services

Act (Alternative Investment Fund Manager) (Third Country)

Regulations.

(2) These regulations transpose and implement, in part, the

provisions of Article 4(1)(a) - (c), (h), (j),(i), (ii), (iv) and (v), (k),

(l), (p), (q), (r), (w), (x), (z), (aa), (ab), (ag), (aj), (al) and (am), as

well as Articles 34(1), Article 35(1) to (10), (15) and (17), Article

36(1) and (2), Article 37(1) to (13) and (19), Article 38(5) and (6),

Article 39(1) to (9) and (11), Article 40(1) to (10), (15) and (17),

Article 41(1) to (6), Article 42(1) and (2), Article 43, Article 45,

46(3), Article 50(4) [2nd and 3rd paragraph], Article 52(1), Article

66(3) and (4), Article 68(6), Annex III and Annex IV of the AIFM

Directive, and they shall be interpreted and applied accordingly.

(3) These regulations shall come into force on such date as the

Minister for Finance, the Economy and Investment may by notice

in the Gazette establish.

(1)

In these regulations, unless the context otherwise

requires -

"Act" means the Investment Services Act;

"Alternative Investment Fund" or "AIF" means a collective

investment scheme, including subfunds thereof, which raises

capital from a number of investors, with a view to investing it in

accordance with a defined investment policy for the benefit of

those investors, and which does not qualify as a UCITS Scheme in

terms of the UCITS Directive;

"Alternative Investment Fund Manager" or "AIFM" means a

legal person whose regular business is managing one or more AIFs;

"the AIFM Directive" means Directive 2011/61/EU of the

European Parliament and of the Council of 8 June 2011 on

Alternative Investment Fund Managers and amending Directives

2003/41/EC and 2009/65/EC and Regulations (EC) No 1060/2009

and (EU) No 1095/2010 as amended from time to time, and

includes any implementing measures that may be issued

thereunder;

*regulations 2, 3, 7, 22 and 30 came into force on 22nd July, 2013 - vide Legal Notice

215 of 2013. The remaining provisions are not yet in force.

"branch", when relating to an AIFM, means a place of business

which is a part of an AIFM, which has no legal personality and

which provides the services for which the AIFM has been

authorised; all the places of business established in the same

Member State or EEA State by an AIFM with its registered office

in another Member State or EEA State or in a third country shall be

regarded as a single branch;

"competent authority" means the Malta Financial Services

Authority established by the Malta Financial Services Authority

Act, which body shall also carry out the duties as competent

authority for all purposes of the AIFM Directive;

"ESMA" means the European Securities and Markets Authority

established by Regulation (EU) No. 1095/2010 of the European

Parliament and of the Council of the 24 November 2010;

"established" means

(a) in relation to an AIF, the place where the AIF is

authorised or registered or if the AIF is not authorised

or registered, the place where the AIF has its

registered office;

(b) in relation to an AIFM, the place where the AIFM has

its registered office;

(c) in relation to legal representatives that are legal

persons, the place where the legal representative has

its registered office or branch;

(d) in relation to legal representatives that are natural

persons, the place where the legal representative is

domiciled;

"European AIF" means

(a) an AIF which is authorised or registered in a Member

State or EEA State, including Malta, under the

applicable national law;

(b) an AIF which is not authorised or registered in a

Member State or EEA State but has its registered

office and, or head office in a Member State or EEA

State, including Malta;

"European AIFM" means an AIFM which has its registered

office in a European Member State or EEA State other than Malta;

"European AIFM home Member State" or "EEA State" means the

Member State or EEA State in which the AIFM has its registered

office; for third country AIFMs, all references to ‘home Member

State of the AIFM’ shall be read as the Member State of reference

as provided for in these regulations;

"European regulatory authority" means the body or bodies

designated by a Member State or an EEA State, other than Malta, in

accordance with Article 44 of the AIFMD to carry out the duties

provided for in the AIFM Directive;

"FATF" means the Financial Action Task Force established in

1989;

INVESTMENT SERVICES ACT (ALTERNATIVE

INVESTMENT FUND MANAGER) (THIRD COUNTRY)

"home Member State of the AIF" means

(a) the Member State or EEA State in which the AIF is

authorised or registered under applicable national law,

or in case of multiple authorisations or registrations,

the Member State or EEA State in which the AIF has

been authorised or registered for the first time; or

(b) if the AIF is neither authorised nor registered in a

Member State or EEA State, the Member State or EEA

State in which the AIF has its registered office and, or

head office;

"host Member State of the AIFM" means

(a) a Member State or EEA State, other than the home

Member State or EEA State, in which the European

AIFM manages European AIFs;

(b) a Member State or EEA State, other than the home

Member State or EEA State, in which a European

AIFM markets units or shares of a European AIF;

(c) a Member State or EEA State other than the home

Member State in which a European AIFM markets

units or shares of a third country AIF;

(d) a Member State or EEA State, other than the Member

State of reference, in which a third country AIFM

manages European AIFs;

(e) a Member State or EEA State other than the Member

State of reference, in which a third country AIFM

markets units or shares of a European AIF;

(f)

a Member State or EEA State, other than the Member

State of reference, in which a third country AIFM

markets units or shares of a third country AIF;

"Maltese AIFM" means an AIFM which is licensed in terms of

the Act and has its registered office in Malta;

"managing AIFs" means performing at least investment

management functions referred to in point 1(a) or (b) of Annex 1 of

the AIFM Directive for one or more AIFs;

"marketing" means a direct or indirect offering or placement at

the initiative of the AIFM or on behalf of the AIFM of units or

shares of an AIF that it manages to or with investors domiciled or

with a registered office in a Member State or EEA State;

"Member State of reference” shall mean the Member State

determined in accordance with these regulations;

"OECD" means the Organisation for Economic Co-operation and

Development established in 1961;

"professional investor" shall have the meaning assigned to

"professional client" in the Investment Services Rules or an

investor who has opted to be treated as a professional client in

terms of said Rules;

"retail investor" means an investor who is not a professional

investor;

"supervisory authorities", in relation to third country AIFs,

means the national authorities of a third country which are

empowered by law or regulation to supervise AIFs;

"supervisory authorities", in relation to third country AIFMs,

means the national authorities of a third country which are

empowered by law or regulation to supervise AIFMs;

"third country" means a country which is not a Member State or

an EEA State;

"third country AIF" means an AIF which is not a European AIF;

"third country AIFM" means an AIFM which is not a European

AIFM;

"Tribunal" means the Financial Services Tribunal established in

terms of the Malta Financial Services Authority Act;

"the UCITS Directive" means Directive 2009/65/EC ofthe

European Parliament and of the Council of 13 July 2009 onthe

coordination of laws, regulations and administrativeprovisions

relating to undertakings for collective investment intransferable

securities (UCITS) (recast), as amended from timeto time, and

includes any implementing measures that have beenor may be

issued thereunder.

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

also used in the Act but which are not defined herein shall have the

same meaning as in the Act.

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

provisions of the AIFM Directive, the latter shall prevail.

MALTESE AIFMs MANAGING THIRD COUNTRY AIFs NOT

MARKETED IN ANY MEMBER STATE OR EEA STATE

A Maltese AIFM may manage a third country AIF which is

not marketed in any Member State or EEA State provided that

(a) the Maltese AIFM complies with all the requirements

prescribed in the AIFM Directive applicable to that

AIF with the exception of Articles 21 and 22 of the

said Directive detailing the appointment of the

custodian and the prescribed contents of the AIF’s

annual report respectively; and

(b) appropriate cooperation arrangements are in place

between the competent authority and the supervisory

authority of the third country where the third country

AIF is established, in order to ensure at least an

efficient exchange of information that allows the

competent authority to carry out its duties in

accordance with the provisions of the AIFM Directive.

MALTESE AIFMs MARKETING THIRD COUNTRY AIFs AND

EUROPEAN FEEDER AIFs IN ANY MEMBER STATE OR EEA

STATE

(1) Without prejudice to Article 43 of the AIFM Directive,

a Maltese AIFM may market to professional investors in any

Member State or EEA State, units or shares of third country AIFs it

manages and of European feeder AIFs that do not fulfil the

requirements prescribed in the second sub-paragraph of Article

31(1) of the AIFM Directive, as soon as the conditions prescribed

hereunder are met

Provided that where a Maltese AIFM intends to market

units or shares of a third country AIF in Malta to professional

investors, such third country AIF shall be exempt from the

provisions of article 4 of the Act.

(2) The Maltese AIFM shall comply with all the requirements

prescribed in the AIFM Directive with the exception of Chapter VI

thereof as transposed in the Investment Services Act (Alternative

Investment Fund Managers) (Passport) Regulations, and the

Investment Services Act (Marketing of Alternative Investment

Funds) Regulations.

(3)

In addition, the competent authority shall also ensure that

(a) appropriate cooperation arrangements are in place

between the competent authority and the supervisory

authority of the third country where the third country

AIF is established in order to ensure at least an

efficient exchange of information, taking into account

the provisions of the Act, which allows the competent

authority to carry out its duties in accordance with the

provisions of the AIFM Directive;

(b) the third country where the third country AIF is

established is not listed as a Non-Cooperative Country

and Territory by FATF;

(c) the country where the third country AIF is established

has signed an agreement with Malta or with the

competent authority and with each other Member State

or EEA State in which the units or shares of the third

country AIF are intended to be marketed, which fully

complies with the standards prescribed in Article 26 of

the OECD Model Tax Convention on Income and on

Capital and ensures an effective exchange of

information in tax matters, including any multilateral

tax agreements.

(4) Where a European regulatory authority of another Member

State or EEA State disagrees with the assessment made on the

application of sub-regulation (3)(a) and (b) by the competent

authority, the European regulatory authority concerned may refer

the matter to ESMA which may act in accordance with the powers

conferred on it under Article 19 of Regulation (EU) No 1095/2012.

(1) Where a Maltese AIFM intends to market units or

shares of a third country AIF in Malta, the Maltese AIFM shall

submit a notification to the competent authority in respect of each

third country AIF that it intends to market

Provided that, without prejudice to regulation 30, third

country AIFs managed and marketed by a Maltese AIFM shall be

marketed only to professional investors

Provided further that where a Maltese AIFM intends to

market units or shares of a third country AIF in Malta to

professional investors, such third country AIF shall be exempt from

the provisions of Article 4 of the Act.

(2) The notification referred to in sub-regulation (1) shall

comprise the following documentation

(a) a notification letter, including a programme of

operations identifying the third country AIFs which

the Maltese AIFM intends to market and the

information on where the third country AIFs are

established;

(b) the third country AIF’s prospectus or equivalent rules

or instruments of incorporation;

(c) identification of the custodian of the third country

AIF;

(d) a description of, or any information on, the third

country AIF available to investors;

(e) information on where the master AIF is established if

the third country AIF is a feeder AIF;

(f)

any additional information concerning the disclosure

obligations prescribed by the Investment Services

Rules for each third country AIF which the Maltese

AIFM intends to market;

(g) where relevant, information on the arrangements

established to prevent units or shares of the third

country AIF from being marketed to retail investors,

including in the case where the Maltese AIFM relies

on activities of independent entities to provide

investment services in respect of the third country AIF.

(3) The competent authority shall, no later than twenty working

days after the receipt of a complete notification filed pursuant to

sub-regulation (2), inform the Maltese AIFM whether it may start

marketing the third country AIF identified in the said notification

in Malta

Provided that in the case of a positive decision, the Maltese

AIFM may start marketing the third country AIF in Malta as of the

date of the notification by the competent authority to that effect.

(4) The competent authority shall prevent the Maltese AIFM

from marketing the third country AIF in Malta only if the Maltese

AIFM’s management of the third country AIF does not or will not

comply with the provisions of the AIFM Directive or the Maltese

AIFM otherwise does not or will not comply with the provisions of

the AIFM Directive.

(5) The competent authority shall also inform ESMA that the

Maltese AIFM may start marketing the units or shares of the third

country AIF in Malta.

(6) In the event of a material change to any of the particulars

communicated in accordance with sub-regulation (2), the Maltese

AIFM shall give written notice thereof to the competent authority

at least one month prior to the implementation of such planned

change, or immediately after an unplanned change has occurred.

(7) Where, pursuant to a planned change, the Maltese AIFM’s

management of the third country AIF would no longer comply with

the provisions of the AIFM Directive, or the Maltese AIFM would

no longer comply with the provisions of the AIFM Directive, the

competent authority shall inform the Maltese AIFM without undue

delay that it shall not implement the change.

(8) Where the Maltese AIFM proceeds with the implementation

of the planned change, notwithstanding the notification received

pursuant to sub-regulations (6) and (7), or if an unplanned change

has taken place pursuant to which the Maltese AIFM’s management

of the third country AIF no longer complies with the provisions of

the AIFM Directive or the Maltese AIFM otherwise no longer

complies with the provisions of the AIFM Directive, the competent

authority shall take all due measures in accordance with the

provisions of the Act and any regulations issued thereunder,

including, if necessary, the express prohibition of marketing of the

third country AIF.

(9) If the changes are acceptable because they do not affect the

compliance of the Maltese AIFM’s management of the third

country AIF with the provisions of the AIFM Directive, or the

compliance by the Maltese AIFM with the provisions of the AIFM

Directive, the competent authority shall, without delay, inform

ESMA in so far as the changes concern the termination of the

marketing of certain AIFs or additional AIFs marketed.

(1) Where a Maltese AIFM intends to market units or

shares of a third country AIF in a Member State or EEA State other

than Malta, the Maltese AIFM shall submit a notification to the

competent authority in respect of every third country AIF that it

intends to market

Provided that, without prejudice to Article 43 of the AIFM

Directive, third country AIFs managed and marketed by a Maltese

AIFM shall be marketed only to professional investors.

(2) The notification referred to in sub-regulation (1) shall

comprise the following documentation

(a) a notification letter, including a programme of

operations identifying the third country AIFs which

the Maltese AIFM intends to market and the

information on where the third country AIFs are

established;

(b) the third country AIF’s prospectus or equivalent rules

or instruments of incorporation;

(c) identification of the custodian of the third country

AIF;

(d) a description of, or any information on, the third

country AIF available to investors;

(e) information on where the master AIF is established if

the third country AIF is a feeder AIF;

(f)

any additional information concerning the disclosure

obligations prescribed in Investment Services Rules

for each third country AIF which the Maltese AIFM

intends to market;

(g) the indication of the Member State or EEA State in

which it intends to market the units or shares of the

third country AIF to professional investors;

(h) information on the arrangements made for the

marketing of the third country AIF and, where

relevant, information on the arrangements established

to prevent units or shares of the third country AIF from

being marketed to retail investors, including in the

case where the Maltese AIFM relies on activities of

independent entities to provide investment services in

respect of the third country AIF

Provided that the notification letter by the Maltese AIFM

referred to above shall be provided in a language customary in the

sphere of international finance.

(3) The competent authority shall, no later than twenty working

days after the receipt of a complete notification filed pursuant to

sub-regulation (2), transmit the complete notification file to the

European regulatory authority of the Member State or EEA State

where the third country AIF is intended to be marketed.

(4) The competent authority shall also enclose a statement to

the effect that the Maltese AIFM concerned is authorised to manage

AIFs with a particular investment strategy

Provided that the statement referred to above shall be

provided in a language customary in the sphere of international

finance.

(5) The competent authority shall proceed with the

transmission of the complete notification file only if the Maltese

AIFM’s management of the third country AIF complies and will

continue to comply with the provisions of the AIFM Directive and

the Maltese AIFM otherwise complies with the provisions of the

AIFM Directive.

(6) Upon transmission of the notification file, the competent

authority shall, without delay, notify the Maltese AIFM thereof.

The Maltese AIFM may start marketing the third country AIF in the

h o s t M e m b e r St a t e o r E E A St a t e a s f r o m t h e d a t e o f s u c h

notification by the competent authority.

(7) The competent authority shall also inform ESMA that the

Maltese AIFM may start marketing the units or shares of the third

country AIF in the host Member State or EEA State of the Maltese

AIFM.

(8) Arrangements referred to in sub-regulation (2)(h) shall be

subject to the laws of the host Member State or EEA State of the

Maltese AIFM and to the supervision of the European regulatory

authority therein.

(9) In the event of a material change to any of the particulars

communicated in accordance with sub-regulation (2), the Maltese

AIFM shall give written notice thereof to the competent authority

at least one month prior to the implementation of such a planned

change, or immediately after an unplanned change has occurred.

(10) Where, pursuant to a planned change, the Maltese AIFM’s

management of the third country AIF or the Maltese AIFM would

no longer comply with the provisions of the AIFM Directive, the

competent authority shall inform the Maltese AIFM without undue

delay that it shall not implement the change.

(11) Where the Maltese AIFM proceeds with the implementation

of the planned change, notwithstanding the notification received

pursuant to sub-regulations (9) and (10), or if an unplanned change

has taken place pursuant to which the Maltese AIFM’s management

of the third country AIF no longer complies with the provisions of

the AIFM Directive or the Maltese AIFM otherwise no longer

complies with the provisions of the AIFM Directive, the competent

authority shall take all due measures in accordance with the

provisions of the Act and any regulations issued thereunder,

including, if necessary, the express prohibition of marketing of the

third country AIF.

(12) If the changes are acceptable because they do not affect the

compliance of the Maltese AIFM’s management of the third

country AIF with the provisions of the AIFM Directive, or the

compliance by the Maltese AIFM with the provisions of the AIFM

Directive, the competent authority shall, without delay, inform

ESMA in so far as the changes concern the termination of the

marketing of certain AIFs or additional AIFs marketed and, if

applicable, the European regulatory authority of the host Member

State or EEA State of the Maltese AIFM.

MALTESE AND EUROPEAN AIFMs MARKETING THIRD

COUNTRY AIFs AND EUROPEAN FEEDER AIFs

ONLY IN MALTA

(1) Without prejudice to regulation 30, a Maltese or

European AIFM may market units or shares of a third country AIF

it manages, and of European feeder AIFs that do not fulfil the

requirements prescribed in the second sub-paragraph of Article

31(1) of the AIFM Directive, only in Malta to professional

investors, without complying with the passport notification

prescribed in regulations 5 and 8 respectively, provided that

(a) the Maltese or European AIFM complies with all the

requirements prescribed in the AIFM Directive other

than Article 21. The Maltese or European AIFM shall

however ensure that one or more entities are appointed

to carry out the duties referred to in Article 21(7), (8)

and (9) of the AIFM Directive and the Maltese or

European AIFM shall not perform those functions. The

Maltese of European AIFM shall provide the

competent authority with information about the

identity of those entities responsible for carrying on

the duties referred to in Article 21(7), (8) and (9) of

the AIFM Directive;

(b) appropriate cooperation arrangements for the purpose

of systemic risk oversight and in line with

international standards are in place between the

competent authority, in the case of a Maltese AIFM, or

the European regulatory authority, in case of a

European AIFM, and the supervisory authorities of the

third country where the third country AIF is

established in order to ensure an efficient exchange of

information that allows the competent authority to

carry out its duties in accordance with the provisions

of the AIFM Directive;

(c) the third country where the third country AIF is

established is not listed as a Non-Cooperative Country

and Territory by FATF.

(2) Where a Maltese or European AIFM intends to market units

or shares of a third country AIF it manages in Malta to professional

investors, such third country AIF shall be exempt from the

provisions of Article 4 of the Act.

(3) For the purposes of this regulation, the competent authority

may impose stricter rules in the Maltese or European AIFM in

respect of the marketing of units or shares of third country AIFs to

investors in Malta.

EUROPEAN AIFMs MARKETING THIRD COUNTRY AIFs

AND EUROPEAN FEEDER AIFs IN MALTA

(1) Where a European AIFM intends to market units or

shares of a third country AIF in Malta, the European AIFM shall

submit a notification to its European regulatory authority in respect

of each third country AIF that it intends to market and such

European AIFM and third country AIF shall be exempt from the

provisions of articles 3 and 4 of the Act respectively

Provided that, without prejudice to regulation 30, AIFs

managed and marketed by a European AIFM shall be marketed in

Malta only to professional investors.

(2) The notification referred to in sub-regulation (1) shall

comprise the following documentation

(a) a notification letter, including a programme of

operations identifying the third country AIFs which

the European AIFM intends to market and the

information on where the third country AIFs are

established;

(b) the third country AIF’s prospectus or equivalent rules

or instruments of incorporation;

(c) identification of the custodian of the third country

AIF;

(d) a description of, or any information on, the third

country AIF available to investors;

(e) information on where the master AIF is established if

the third country AIF is a feeder AIF;

(f)

any additional information concerning the disclosure

obligations referred to in Article 23(1) of the AIFM

Directive for each third country AIF which the

European AIFM intends to market;

(g) the indication of Malta as being the Member State in

which it intends to market the units or shares of the

third country AIF to professional investors;

(h) information on the arrangements made for the

marketing of the third country AIF and, where

relevant, information on the arrangements established

to prevent units or shares of the third country AIF from

being marketed to retail investors, including in the

case where the European AIFM relies on activities of

independent entities to provide investment services in

respect of the third country AIF

Provided that the notification letter by the European AIFM

referred to above shall be provided in a language customary in the

sphere of international finance.

(3) The competent authority shall, no later than twenty working

days after the date of receipt of a complete notification file

p u r su an t t o s u b - r e g u l at i o n ( 2 ) , r e c e i v e f r o m t h e E u r o p ea n

regulatory authority of the European AIFM’s home Member State

or EEA State the complete notification file.

(4) The notification file transmitted to the competent authority

shall also include a statement to the effect that the European AIFM

concerned is authorised to manage AIFs with a particular

investment strategy

Provided that the statement referred to above shall be

provided in a language customary in the sphere of international

finance.

(5) The competent authority shall receive the complete

notification file from the European regulatory authority only if the

European AIFM’s management of the third country AIF complies

with and will continue to comply with the provisions of the AIFM

Directive and if the European AIFM otherwise complies with the

provisions of the AIFM Directive.

(6) Upon transmission of the notification file to the competent

authority, the European AIFM may start marketing the third

country AIF in Malta as from the date that it is notified by the

European regulatory authority of such transmission.

(7) Arrangements referred to in sub-regulation (2)(h) shall be

subject to the laws of the host Member State or EEA State of the

Maltese AIFM and to the supervision of the European regulatory

authority therein.

(8) In the event of the implementation of an acceptable material

change to any of the particulars communicated in accordance with

sub-regulation (2), the competent authority shall receive

notification thereof from the European regulatory authority of the

home Member State or EEA State of the European AIFM, in so far

as the changes concern the termination of the marketing of certain

third country AIFs or additional third country AIFs marketed.

LICENSING OF THIRD COUNTRY AIFMs AND CHOICE OF

MALTA AS MEMBER STATE OF REFERENCE

(1) A third country AIFM intending to manage European

AIFs in Malta and, or market such AIFs in a Member State or EEA

State, in accordance with regulations 11 to 14, shall be required to

acquire a licence from the competent authority in terms of the Act

in the case where Malta is deemed to be its Member State of

reference in accordance with this regulation.

(2) A third country AIFM intending to obtain a licence in terms

of the Act, as referred to in sub-regulation (1), shall comply with

the provisions of the AIFM Directive with the exception of Chapter

VI thereof as transposed in the Investment Services Act

(Alternative Investment Fund Manager Passport) Regulations, and

the Investment Services Act (Marketing of Alternative Investment

Funds) Regulations.

(3) If and to the extent that compliance with a provision of the

AIFM Directive is incompatible with compliance with the law to

which the third country AIFM and, or the third country AIF

marketed in the Union is subject, there shall be no obligation on the

third country AIFM to comply with that provision of the AIFM

Directive if it can demonstrate that

(a) it is impossible to combine such compliance with

compliance with a mandatory provision in the law to

which the third country AIFM and, or the third country

AIF marketed in any Member State or EEA State is

subject;

(b) the law to which the third country AIFM and, or the

third country AIF is subject provides for an equivalent

rule having the same regulatory purpose and offering

the same level of protection to the investors of the

relevant AIF; and

(c) the third country AIFM and, or the third country AIF

complies with the equivalent rule referred to in

paragraph (b).

(4) The third country AIFM intending to obtain a licence in

terms of the Act, as referred to in sub-regulation (1), shall have a

legal representative established in Malta.

(5) The legal representative referred to in sub-regulation (4)

shall be the contact point of the third country AIFM in the Union.

Any official correspondence between the competent authority, the

third country AIFM and the investors in any Member State or EEA

State of the relevant AIF and of the third country AIFM as provided

INVESTMENT SERVICES ACT (ALTERNATIVE

INVESTMENT FUND MANAGER) (THIRD COUNTRY)

for in the AIFM Directive, shall take place through the said legal

representative. The legal representative shall perform the

compliance function relating to the management and marketing

activities performed by the third country AIFM under the AIFM

Directive together with the third country AIFM.

(6) The choice of Malta as a Member State of reference shall be

determined as follows

(a) if the third country AIFM intends to manage only one

AIF or several AIFs established in Malta, and does not

intend to market any AIF in accordance with

regulations 11 to 14 in any Member State or EEA

State, Malta, being the home Member State of that or

those AIFs, shall be deemed to be the Member State of

reference and the competent authority shall be

competent for the licensing procedure and for the

supervision of the third country AIFM;

(b) if the third country AIFM intends to manage several

European AIFs established in different Member States

and does not intend to market any AIF in accordance

with regulations 11 to 14 in any Member State or EEA

State, Malta shall be deemed to be the Member State of

reference where

(i) it is the Member State where most of the AIFs

are established; or

(ii) it is the Member State where the largest amount

of assets is being managed;

(c) if the third country AIFM intends to market only one

European AIF in only one Member State, Malta shall

be deemed to be the Member State of reference where

(i) Malta is the country where the AIF is licensed or

registered, that is the home Member State of the

AIF, or the Member State where the third

country AIFM intends to market the AIF;

(ii) if the AIF is not licensed or registered in Malta

or any other Member State or EEA State, the

third country AIFM intends marketing the AIF

in Malta;

(d) if the third country AIFM intends to market only one

third country AIF only in Malta, Malta shall be

deemed to be the Member State of reference;

(e) if the third country AIFM intends to market only one

European AIF, but in different Member States or EEA

States, Malta shall be deemed to be the Member State

of reference in the following cases

(i) if the AIF is licensed or registered in Malta and

Malta is the home Member State of such AIF or

otherwise Malta is one of the Member States

where the third country AIFM intends to

develop effective marketing; or

(ii) if although the AIF is not licensed or registered

in Malta or any other Member State or EEA

State, one of the Member States where the third

country AIFM intends to develop effective

marketing is Malta;

(f)

if the third country AIFM intends to market only one

third country AIF, in different Member States or EEA

States, Malta shall be deemed to be the Member State

of reference if it is one of the Member States where the

third country AIFM intends to market the third country

AIF;

(g) if the third country AIFM intends to market several

European AIFs in Member States or EEA States, Malta

shall be deemed to be the Member State of reference in

the following cases

(i) in so far as those AIFs are all registered or

licensed in Malta, Malta is the home Member

State of the AIFs or the Member State where the

third country AIFM intends to develop effective

marketing for most of those AIFs;

(ii) in so far as those AIFs are not all registered or

licensed in Malta or any other Member State or

EEA State, Malta is still the Member State where

the third country AIFM intends to develop

effective marketing for most AIFs;

(h) if the third country AIFM intends to market several

European and third country AIFs, or several third

country AIFs in the any Member State or EEA State,

Malta shall be deemed to be the Member State of

reference if the third country AIFM intends to develop

effective marketing for most of those AIFs in Malta.

(7) In accordance with the criteria prescribed in sub-regulation

(6)(b), (c)(i), (e), (f) and (g)(i), more than one Member State of

reference is possible. In such cases, the European regulatory

authorities including the competent authority, shall require that the

third country AIFM intending to manage European AIFs without

marketing them and, or marketing AIFs managed by it in any

Member State or EEA State according to regulations 11 to 14,

submits a request to all the European regulatory authorities

including the competent authority of all the Member States or EEA

States that are possible Member States of reference in accordance

with the criteria prescribed in the aforementioned paragraphs, to

determine the Member State of reference from among them.

(8) The European regulatory authorities including the

competent authority shall jointly decide which Member State shall

be the Member State of reference for the third country AIFM within

one month from the receipt of such request.

(9) In the case where Malta is deemed to be the Member State

of reference, the competent authority shall, without undue delay,

inform the third country AIFM of that appointment.

(10) Where the competent authority fails to notify the third

country AIFM of the decision made by same within seven days of

the decision, or if the relevant European regulatory authorities

including the competent authority have not made a decision within

a period of one month, the third country AIFM may itself choose its

Member State of reference based on the criteria outlined in sub-

regulation (6).

(11) The third country AIFM shall be able to prove its intention

to develop effective marketing in Malta by disclosing its marketing

strategy to the competent authority.

(12) Where Malta is the Member State of reference, a third

country AIFM intending to manage European AIFs without

marketing them and, or to market AIFs managed by it in a Member

State or EEA State in accordance with regulations 11 to 14, shall

submit a request for a licence with the competent authority.

(13) After receiving the licensing application, the competent

authority shall assess whether the determination of Malta by the

third country AIFM as its Member State of reference complies with

the criteria prescribed in sub-regulations (6) to (11).

(14) If the competent authority considers that the criteria

prescribed in sub-regulations (6) to (11) have not been complied

with, it shall refuse the licensing application of the third country

AIFM explaining the reasons for its refusal.

(15) If the competent authority considers that the criteria

prescribed in sub-regulations (6) to (11) have been complied with,

i t s h a l l p r o c e e d t o n o t i f y E SM A , r e q u e s t i n g a d v i c e o n i t s

assessment. In its notification to ESMA, the competent authority

shall provide ESMA with the justification by the AIFM of its

assessment regarding the choice of Malta as the Member State of

reference and with information on the marketing strategy of the

third country AIFM.

(16) Within one month of having notified ESMA pursuant to

sub-regulation (15), the competent authority shall receive advice

from ESMA about its assessment on the choice of Malta as the

M e m b e r St a t e o f r ef er en c e i n a c c o r d a n c e w i t h t h e c r i t e r i a

prescribed in sub-regulations (6) to (11)

Provided that the competent authority shall be notified by

ESMA with a negative advice only if ESMA considers that the

criteria prescribed in sub-regulations (6) to (11) have not been

complied with

Provided further that the term of three months granted to

the competent authority in terms of Article 8(5) of the AIFM

Directive to inform the applicant whether or not a licence has been

granted shall be suspended during ESMA’s deliberation.

(17) Where the competent authority proposes to grant a licence

contrary to ESMA’s advice referred to in the first proviso to sub-

regulation (16), it shall proceed to inform ESMA, stating its

reasons. ESMA shall publish the fact that the competent authority

does not comply or does not intend to comply with its advice

Provided that ESMA may also decide, on a case-by-case

basis, to publish the reasons provided by the competent authority

for not complying with that advice and it shall proceed to notify the

competent authority in advance of such publication.

(18) Where the competent authority proposes to grant a licence

contrary to ESMA’s advice as referred to in sub-regulation (16) and

the third country AIFM intends to market units or shares of the

AIFs managed by it in a Member State or EEA State other than

Malta, the competent authority shall inform the European

regulatory authorities of those Member States or EEA States

thereof, stating its reasons. In so far as applicable, the competent

authority shall also inform the European regulatory authority of the

home Member States or EEA States of the AIFs managed by the

AIFM thereof, stating its reasons.

(19) Where the European regulatory authority of a Member State

or EEA State disagrees with the determination by the third country

AIFM of Malta as the Member State of reference, the European

regulatory authority concerned may refer the matter to ESMA,

which may act in accordance with the powers conferred on it under

Article 19 of Regulations (EU) No. 1095/2010.

(20) Without prejudice to sub-regulations (23) and (24), the

competent authority shall not grant a licence unless the following

additional conditions are met

(a) Malta is indicated as a Member State of reference by

the third country AIFM in accordance with the criteria

prescribed in sub-regulations (6) to (11) and supported

by the disclosure of the marketing strategy, and the

procedure prescribed in sub-regulations (12) to (18)

has been followed by the competent authority and the

relevant European regulatory authorities concerned;

(b) the third country AIFM has appointed a legal

representative established in Malta;

(c) the legal representative shall, together with the third

country AIFM, be the contact person of the third

country AIFM for the investors of the relevant AIFs,

for ESMA and for the competent authority as regards

the activities for which the third country AIFM is

licensed in Malta and shall at least be sufficiently

equipped to perform the compliance function pursuant

to the provisions of the AIFM Directive;

(d) appropriate cooperation arrangements are in place

between the competent authority, the European

regulatory authority of the home Member State or EEA

State of the European AIFs concerned and the

supervisory authorities of the third country where the

third country AIFM is established in order to ensure at

least an efficient exchange of information that allows

the competent authority to carry out its duties in

accordance with the provisions of the AIFM Directive;

(e) the third country where the third country AIFM is

established is not listed as a Non-Cooperative Country

and Territory by FATF;

(f)

the country where the third country AIFM is

established has signed an agreement with Malta, which

fully complies with the standards prescribed in Article

26 of the OECD Model Tax Convention on Income and

on Capital and ensures an effective exchange of

information in tax matters, including any multilateral

tax agreements;

(g) the effective exercise by the competent authority of its

supervisory functions under the AIFM Directive is

neither prevented by the laws, regulations or

administrative provisions of a third country governing

the third country AIFM, nor by limitations in the

supervisory and investigatory powers of that third

country’s supervisory authorities.

(21) Where a European regulatory authority of another Member

State or EEA State disagrees with the assessment made by the

competent authority on the application of sub-regulation (20)(a) to

(e) and (g), the European regulatory authority concerned may refer

the matter to ESMA, which may act in accordance with the powers

conferred on it under Article 19 of Regulation (EU) No. 1095/2010.

(22) Where a European regulatory authority of a European AIF

d o e s n o t e n t er i n t o t h e r e q u i r e d c o o p e r a t i o n a r r a n g e m en t s

prescribed in sub-regulation (20)(d) within a reasonable period of

time, the competent authority may refer the matter to ESMA, which

may act in accordance with the powers conferred on it under

Article 19 of Regulation (EU) No. 1095/2010.

(23) The authorisation granted by the competent authority shall

be in accordance with Chapter II of the AIFM Directive as

transposed in the Investment Services Act and the Investment

Services Rules issued thereunder which shall apply mutatis

mutandis subject to the following criteria

(a) the information referred to in Article 7(2) of the AIFM

Directive shall be supplemented by

(i) a justification by the third country AIFM of its

assessment regarding the choice of Malta as a

Member State of reference in accordance with

the criteria prescribed in sub-regulations (6) to

(11) with information on the marketing strategy;

(ii) a list of the provisions of the AIFM Directive for

which compliance by the third country AIFM is

impossible since compliance by the said AIFM

with those provisions is, in accordance with sub-

regulations (2) to (3), incompatible with

compliance with a mandatory provision in the

law to which the third country AIFM or the third

country AIF marketed in any Member State or

EEA State is subject;

(iii) written evidence which is based on the

regulatory technical standards developed by

ESMA that the relevant third country law

provides for a rule equivalent to the provision

for which compliance is impossible, which has

the same regulatory purpose and offers the same

level of protection to the investors of the

relevant AIFs and that the third country AIFM

complies with that equivalent rule; and such

written evidence is supported by a legal opinion

on the existence of the relevant incompatible

mandatory provision in the law of the third

country and including a description of the

regulatory purpose and the nature of the investor

protection pursued by it; and

(iv)

the name of the legal representative of the third

country AIFM and the place where it is

established;

(b) the information referred to in Article 7(3) of the AIFM

Directive may be limited to the European AIFs the

third country AIFM intends to manage, and to those

AIFs managed by the third country AIFM that it

intends to market in another Member State or EEA

State with a passport;

(c) the competent authority’s satisfaction that the AIFM

will be able to meet the conditions of the AIFM

Directive shall be without prejudice to sub-regulations

(2) and (3);

(d) the requirement stipulated in Article 8(1)(e) of the

AIFM Directive that the head office and the registered

office of the AIFM are located in Malta shall not

apply;

(e) the requirement to submit a complete application in

terms of the Investment Services Rules shall, for the

purposes of this regulation, be deemed to include a

reference to the information referred to in paragraph

(a).

(24) Where a European regulatory authority of another Member

State or EEA State disagrees with the licence granted by the

competent authority, the European regulatory authority concerned

may refer the matter to the ESMA which may act in accordance

with the powers conferred on it under Article 19 of Regulation

(EU) No. 1095/2010.

(25) In the case where the competent authority considers that the

third country AIFM may rely on sub-regulations (2) and (3) to be

exempted from compliance with certain provisions of the AIFM

Directive, it shall, without undue delay, notify ESMA thereof. It

shall support this assessment by the information provided by the

AIFM in accordance with sub-regulation (23)(a)(ii) and (iii).

(26) Within one month of receipt of the notification referred to

in sub-regulation (25), ESMA shall issue advice to the competent

authority about the application of the exemption for compliance

with the provisions of the AIFM Directive, caused by the

incompatibility in accordance with sub-regulations (2) and (3). In

particular, the advice may address whether the conditions for such

exemption appear to be met based on the information provided by

t h e t h i r d c o u nt r y A I F M i n a c c o r d a n c e w i th s u b - r e gu l a ti o n

(23)(a)(ii) and (iii) and on the regulatory technical standards on

equivalence

Provided that the term of three months granted to the

competent authority in terms of Article 8(5) of the AIFM Directive

shall be suspended during the ESMA review.

(27) If the competent authority proposes to grant a licence

contrary to ESMA’s advice as referred to in sub-regulation (26), it

shall inform ESMA stating its reasons. ESMA shall publish the fact

that the competent authority does not comply or does not intend to

comply with that advice

Provided that ESMA may also decide, on a case-by-case

basis, to publish the reasons provided by the competent authority

for not complying with that advice and it shall proceed to notify the

competent authority in advance of such publication.

(28) If the competent authority proposes to grant a licence

contrary to ESMA’s advice as referred to in sub-regulation (26),

and the third country AIFM intends to market units or shares of

AIFs managed by it in Member States or EEA States other than

Malta, the competent authority shall inform the European

regulatory authorities of those Member States or EEA States,

stating its reasons.

(29) Where a European regulatory authority of another Member

State or EEA State disagrees with the assessment made on the

application of sub-regulations (25) to (28) by the competent

authority, the European regulatory authority concerned may refer

the matter to the ESMA which may act in accordance with the

powers conferred on it under Article 19 of Regulation (EU) No.

1095/2010.

(30) The competent authority shall, without undue delay, inform

ESMA of the outcome of the initial licensing process, about any

changes in the licensing of the third country AIFM and any

withdrawal of a licence.

(31) The competent authority shall inform ESMA about the

licensing applications it has rejected, providing data about the third

country AIFM having asked for a licence and the reasons for the

rejection. ESMA shall keep a central register of those data, which

shall be at the disposal of all European regulatory authorities

including the competent authority, on request. This information

shall be treated as confidential.

(32) Where Malta is the Member State of reference and the

competent authority considers that a licensed third country AIFM is

in breach of its obligations under the AI FM Directive, the

competent authority shall notify ESMA, setting out detailed

reasons as soon as possible.

10. (1) The determination of Malta as a Member State of

reference shall not be affected by the further business development

of the third country AIFM in any Member State or EEA State.

(2) Where, however, the third country AIFM changes its

marketing strategy within two years of its initial authorisation, and

that change would have affected the choice of Malta as a Member

State of reference if the modified marketing strategy had been the

initial marketing strategy, the said AIFM shall notify the competent

authority of the change before implementing it and it shall indicate

its Member State of reference in accordance with the criteria

prescribed in regulation 9(6) to (11) and based on the new strategy.

The said AIFM shall justify its assessment by disclosing its new

marketing strategy to the competent authority. At the same time,

the said AIFM shall provide information on its legal representative,

including its name and the place where it is established

Provided that the legal representative shall be established in

the new Member State of reference.

(3) The competent authority shall assess whether the

determination of the third country AIFM in accordance with sub-

regulations (1) and (2) is correct and shall notify ESMA thereof. In

its notification to ESMA, the competent authority shall provide the

third country AIFM’s justification of its assessment regarding the

Member State of reference and information on the said AIFM’s new

marketing strategy

Provided that ESMA shall issue advice on the assessment

made by the competent authority.

(4) Within one month of receipt of the notification referred to

in sub-regulation (3), the competent authority shall receive ESMA’s

advice on the assessment carried out

Provided that ESMA shall issue a negative advice only

where it considers that the criteria prescribed in regulation 9(6) to

(11) have not been complied with.

(5) After receipt of ESMA’s advice in accordance with sub-

regulation (4), the competent authority shall inform the third

country AIFM, its original legal representative and ESMA of its

decision.

(6) Where the competent authority agrees with the assessment

made by the third country AIFM, it shall also inform the European

regulatory authority of the new Member State of reference of the

change. The competent authority shall also, without undue delay,

transfer a copy of the licensing and the supervision file relating to

the said AIFM to the European regulatory authority of the new

Member State of reference. From the date of transmission of the

licensing and supervision file, the European regulatory authority of

the new Member State of reference shall be responsible for the

licensing and supervision of the said AIFM.

(7) Where the final assessment of the competent authority is

contrary to ESMA’s advice as referred to in sub-regulation (4)

(a) the competent authority shall inform ESMA thereof,

stating reasons. ESMA shall publish the fact that the

competent authority does not comply, or does not

intend to comply with its advice

Provided that ESMA may also decide, on a case-by-

case basis, to publish the reasons for non-compliance

provided by the competent authority and it shall

proceed to notify the competent authority in advance

of such publication;

(b) where the third country AIFM markets units or shares

of the AIFs managed by it in Member States or EEA

States other than Malta, the competent authority shall

inform the European regulatory authorities of those

other Member States or EEA States thereof, stating

reasons. Where applicable, the competent authority

shall also inform the European regulatory authority of

the home Member State or EEA State of the AIFs

managed by the said AIFM thereof, stating reasons.

(8) Where it appears from the actual course of the business

development of the third county AIFM in the Member State or EEA

State within two years after its licensing, that the marketing

strategy as presented by the AIFM at the time of its licensing was

not followed, that the AIFM made false statements in relation

thereto or that the AIFM has failed to comply with the conditions

p r e s c r i b e d i n s u b - r e gu l a t i o ns ( 1 ) t o ( 7 ) w h e n c h a n g i n g i t s

marketing strategy, the competent authority shall request that the

third country AIFM indicates the Member State of reference based

on its actual marketing strategy. The procedure prescribed in sub-

regulations (1) to (7) shall apply mutatis mutandis.

(9) If the third country AIFM fails to comply with the request

made by the competent authority, it shall withdraw the AIFM’s

licence.

(10) Where the AIFM changes its marketing strategy after the

period of two years as referred to in sub-regulations (1) to (7), and

intends to change its Member State of reference on the basis of its

new marketing strategy, it may submit a request to change its

Mem ber State of reference to the competent authority. The

procedure prescribed in sub-regulations (1) to (7) shall apply

mutatis mutandis.

(11) Where a European regulatory authority of a Member State

or EEA State disagrees with the assessment made on the

determination of the Member State of reference under sub-

regulations (1) to (7) hereof under sub-regulations (8) to (10), the

European regulatory authority concerned may refer the matter to

ESMA which may act in accordance with the powers conferred on

it under Article 19 of Regulation (EU) No 1095/2010.

(12) Any disputes arising between the competent authority as

the third county AIFM’s Member State of reference, and the said

AIFM, shall be settled in accordance with the law of Malta and

shall be subject to the jurisdiction of the Courts of Malta.

(13) Any disputes between the AIFM or the AIF and investors in

any Member State or EEA State of the relevant AIF shall be settled

in accordance with the law of and subject to the jurisdiction of the

Member State or EEA State involved.

(14) Where a European regulatory authority rejects a request to

exchange information in accordance with the regulatory technical

standards developed by ESMA, the competent authority may refer

the matter to ESMA which may act in accordance with the powers

conferred on it under Article 19 of Regulation (EU) No 1095/2010.

THIRD COUNTRY AIFMs HAVING MALTA AS MEMBER

STATE OF REFERENCE AND MARKETING EUROPEAN AIFs

IN MALTA OR IN ANY MEMBER STATE OTHER THAN

MALTA

11. (1) A third country AIFM duly licensed in Malta may

market to professional investors, in Malta, units or shares of a

European AIF which it manages as soon as the conditions

prescribed in this regulation are met

Provided that, without prejudice to regulation 30, AIFs

managed and marketed by a third country AIFM shall be marketed

in Malta only to professional investors

Provided further, where a duly licensed third country AIFM

intends to market units or shares of a European AIF, registered in a

Member State or EEA State other than Malta, to professional

investors, such European AIF shall be exempt from the provisions

of Article 4 of the Act.

(2) Where the third country AIFM duly authorised in Malta

intends to market units or shares of the European AIF in Malta,

after having deemed Malta as its Member State of reference, the

third country AIFM shall submit a notification to the competent

authority in respect of each European AIF that it intends to market.

The notification shall comprise the documentation and information

prescribed hereunder

(a) a notification letter, including a programme of

operations identifying the European AIFs which the

AIFM intends to market and the information on where

the European AIFs are established;

(b) the European AIF’s prospectus or equivalent rules or

instruments of incorporation;

(c) identification of the custodian of the European AIF;

(d) a description of, or any information on, the European

AIF available to investors;

(e) information on where the master AIF is established if

the European AIF is a feeder AIF;

(f)

any additional information concerning the disclosure

obligations prescribed in Investment Services Rules

for each European AIF which the AIFM intends to

market;

(g) where relevant, information on the arrangements

established to prevent units or shares of the European

AIF from being marketed to retail investors, including

in the case where the AIFM relies on activities of

independent entities to provide investment services in

respect of the European AIF.

(3) The competent authority shall, within twenty working days

from receipt of a complete notification pursuant to sub-regulation

(2), inform the third country AIFM whether it may start marketing

the European AIF identified in the notification referred to in sub-

regulation (2) in Malta.

(4) The competent authority may prevent the marketing of the

E u r o p e a n A I F i n M a l t a o n l y i f t h e t h i r d c o u n t r y A I F M ’s

management of the European AIF does not or will not comply with

the provisions of the AIFM Directive or if the third country AIFM

otherwise does not or will not comply with the provisions of the

AIFM Directive.

(5) In the case of a positive decision by the competent

a ut ho r i ty, th e t hi r d c o un t r y A I F M m a y s t a r t m a r k e t in g t he

European AIF in Malta as from the date of the notification by the

competent authority to that effect.

(6) The competent authority shall also inform ESMA and the

European regulatory authorities of the European AIFs that the third

country AIFM may start marketing the units or shares of the

European AIF in Malta.

(7) In the event of a material change to any of the particulars

communicated in accordance with sub-regulation (2), the third

country AIFM shall give written notice thereof to the competent

authority at least one month prior to the implementation of such

planned change, or immediately after an unplanned change has

occurred.

(8) Where, pursuant to a planned change, the third country

AIFM’s management of the European AIF would no longer comply

with the provisions of the AIFM Directive, or the third country

AIFM would otherwise no longer comply with the provisions of the

AIFM Directive, the competent authority shall inform the third

country AIFM without undue delay, that it shall not implement the

change.

(9) Where the third country AIFM proceeds with the

implementation of the planned change, notwithstanding the

notification received pursuant to sub-regulations (7) and (8), or if

an unplanned change has taken place pursuant to which the third

country AIFM’s management of the European AIF no longer

complies with the provisions of the AIFM Directive or the third

country AIFM otherwise no longer complies with the provisions of

the AIFM Directive, the competent authority shall take all due

measures in accordance with the provisions of the Act and any

regulations issued thereunder, including, if necessary, the express

prohibition of marketing of the European AIF.

(10) If the changes are acceptable because they do not affect the

compliance of the third country AIFM’s management of the

European AIF with the provisions of the AIFM Directive, or the

compliance by the third country AIFM with the provisions of the

AIFM Directive, the competent authority shall, without delay,

inform ESMA in so far as the changes concern the termination of

the marketing of certain European AIFs or additional European

AIFs being marketed and, if applicable, the European regulatory

authorities of the host Member State or EEA State of the third

country AIFM of such changes.

12. (1) A third country AIFM duly licensed in Malta may

market to professional investors in a Member State or EEA State

other than Malta, units or shares of a European AIF which it

manages as soon as the conditions prescribed in this regulation are

met

Provided that, without prejudice to Article 43 of the AIFM

Directive, AIFs managed and marketed by a third country AIFM

shall be marketed only to professional investors.

(2) Where the third country AIFM duly licensed in Malta

intends to market units or shares of the European AIF in any

Member State or EEA State other than Malta, the third country

AIFM shall submit a notification to the competent authority in

respect of each European AIF that it intends to market. The

notification shall comprise the documentation and information

prescribed hereunder

(a) a notification letter, including a programme of

operations identifying the European AIFs which the

third country AIFM intends to market and the

information on where the European AIFs are

established;

(b) the European AIF’s prospectus or equivalent rules or

instruments of incorporation;

(c) identification of the custodian of the European AIF;

(d) a description of, or any information on the European

AIF available to investors;

(e) information on where the master AIF is established if

the European AIF is a feeder AIF;

(f)

any additional information concerning the disclosure

obligations prescribed in Investment Services Rules

for each European AIF which the third country AIFM

intends to market;

(g) the indication of the Member State or EEA State in

which it intends to market the units or shares of the

European AIF to professional investors;

(g) information on the arrangements made for the

marketing of the European AIFs and, where relevant,

information on the arrangements established to prevent

units or shares of the European AIF from being

marketed to retail investors, including in the case

where the third country AIFM relies on activities of

independent entities to provide investment services in

respect of the European AIF

Provided that the notification letter by the third country

AIFM referred to above shall be provided in a language customary

in the sphere of international finance.

(3) The competent authority shall, within twenty working days

from receipt of a complete notification pursuant to sub-regulation

(2), transmit the complete notification file to the European

regulatory authorities of the Member States or EEA States where

t he uni ts or shares of th e Eu rop ean AIF are int ended t o be

marketed. The competent authority shall also enclose a statement to

the effect that the third country AIFM concerned is licensed to

manage AIFs with a particular investment strategy

Provided that the statement referred to above shall be

provided in a language customary in the sphere of international

finance.

(4) The competent authority shall proceed with the

transmission of the complete notification file pursuant to sub-

regulation (3), only if the third country AIFM’s management of the

European AIF complies and will continue to comply with the

provisions of the AIFM Directive and if the third country AIFM

otherwise complies with the provisions of the said Directive.

(5) Upon transmission of the notification file, the competent

authority shall, without delay, notify the third country AIFM about

the transmission. The third country AIFM may start marketing the

European AIF in the relevant host Member State or EEA State as of

the date of that notification.

(6) The competent authority shall also inform ESMA and the

European regulatory authorities of the European AIFs that the third

country AIFM may start marketing the units or shares of the

European AIF in the host Member States or EEA State of the third

country AIFM.

(7) The arrangements referred to in sub-regulation (2)(h) shall

be subject to the laws of the host Member State or EEA State of the

third country AIFM and to the supervision of the European

regulatory authority therein.

(8) In the event of a material change to any of the particulars

communicated in accordance with sub-regulation (2), the third

country AIFM shall give written notice thereof to the competent

authority at least one month prior to the implementation of such

planned change, or immediately after an unplanned change has

occurred.

(9) Where, pursuant to a planned change, the third country

AIFM’s management of the European AIF would no longer comply

with the provisions of the AIFM Directive, or the third country

AIFM would otherwise no longer comply with the provisions of the

AIFM Directive, the competent authority shall inform the third

country AIFM without undue delay that it shall not implement the

change.

(10) Where the third country AIFM proceeds with the

implementation of the planned change, notwithstanding the

notification received pursuant to sub-regulations (8) and (9), or if

an unplanned change has taken place pursuant to which the third

country AIFM’s management of the European AIF no longer

complies with the provisions of the AIFM Directive or the third

country AIFM otherwise no longer complies with the provisions of

the AIFM Directive, the competent authority shall take all due

measures in accordance with the provisions of the Act and any

regulations made thereunder, including, if necessary, the express

prohibition of marketing of the European AIF.

(11) If the changes are acceptable because they do not affect the

compliance of the third country AIFM’s management of the

European AIF with the provisions of the AIFM Directive, or the

compliance by the third country AIFM with the provisions of the

AIFM Directive, the competent authority shall, without delay,

inform ESMA in so far as the changes concern the termination of

the marketing of certain European AIFs or additional European

AIFs markete d and, if applicable, the European regulatory

authorities of the host Member State or EEA State of the third

country AIFM of such changes.

THIRD COUNTRY AIFMs HAVING MALTA AS MEMBER

STATE OF REFERENCE AND MARKETING THIRD COUNTRY

AIFs IN MALTA OR IN ANY MEMBER STATE OTHER THAN

MALTA

13. (1) A third country AIFM duly licensed in Malta may

market in Malta units or shares of a third country AIF it manages,

to professional investors in Malta as soon as the conditions

prescribed in this regulation are met

Provided that, without prejudice to regulation 30, third

country AIFs managed and marketed by a third country AIFM shall

be marketed only to professional investors

Provided further, where a duly licensed third country AIFM

intends to market units or shares of a third country AIF it manages

in Malta to professional investors, such third country AIF shall be

exempt from the provisions of Article 4 of the Act.

(2) In addition to the requirements prescribed in the AIFM

Directive in relation to European AIFMs, the following conditions

shall also be met for third country AIFMs

(a) appropriate cooperation arrangements are in place

between the competent authority as the Member State

of reference and the supervisory authority of the

country where the third country AIF is established in

order to ensure at least an efficient exchange of

information, which allows the competent authority to

carry out its duties in accordance with the provisions

of the AIFM Directive;

(b) the third country where the third country AIF is

established is not listed as a Non-Cooperative Country

and Territory by FATF;

(c) the country where the third country AIF is established

has signed an agreement with the competent authority

and with each other Member State or EEA State in

which the units or shares of the third country AIF are

intended to be marketed, which fully complies with the

standards prescribed in Article 26 of the OECD Model

Tax Convention on Income and on Capital and ensures

an effective exchange of information in tax matters,

including any multilateral tax agreements.

(3) Where a European regulatory authority of another Member

State or EEA State disagrees with the assessment made on the

application of sub-regulation (2)(a) and (b) by the competent

authority, the European regulatory authority concerned may refer

the matter to ESMA which may act in accordance with the powers

conferred on it under Article 19 of Regulation (EU) No. 1095/2010.

(4) Where the third country AIFM duly licensed in Malta,

intends to market units or shares of a third country AIF in Malta, as

its Member State of reference, the third country AIFM shall submit

a notification to the competent authority in respect of each third

country AIF that it intends to market in Malta. The notification

shall comprise the documentation and information prescribed

hereunder

(a) a notification letter, including a programme of

operations identifying the third country AIFs which

the third country AIFM intends to market and the

information on where the third country AIFs are

established;

(b) the third country AIF’s prospectus or equivalent rules

or instruments of incorporation;

(c) identification of the custodian of the third country

AIF;

(d) a description of, or any information on the third

country AIF available to investors;

(e) information on where the master AIF is established if

the third country AIF is a feeder AIF;

(f)

any additional information concerning the disclosure

obligations prescribed in Investment Services Rules

for each third country AIF which the third country

AIFM intends to market;

(g) where relevant, information on the arrangements

established to prevent units or shares of the third

country AIF from being marketed to retail investors,

including in the case where the third country AIFM

relies on activities of independent entities to provide

investment services in respect of the third country AIF.

(5) The competent authority shall, within twenty working days

from receipt of a complete notification pursuant to sub-regulation

(4), inform the third country AIFM whether it may start marketing

the third country AIF identified in the notification referred to in

sub-regulation (4) in Malta.

(6) The competent authority may prevent the marketing of the

third country AIF in Malta only if the third country AIFM’s

management of the third country AIF does not or will not comply

with the provisions of the AIFM Directive or if the third country

AIFM otherwise does not or will not comply with the provisions of

the AIFM Directive.

(7) In the case of a positive decision by the competent

authority, the AIFM may start marketing the third country AIF in

Malta as from the date of the notification by the competent

authority to that effect.

(8) The competent authority shall also inform ESMA that the

third country AIFM may start marketing the units or shares of the

third country AIF in Malta.

(9) In the event of a material change to any of the particulars

communicated in accordance with sub-regulation (4), the third

country AIFM shall give written notice thereof to the competent

authority at least one month prior to the implementation of the

planned change, or immediately after an unplanned change has

occurred.

(10) Where, pursuant to a planned change, the third country

AIFM’s management of the third country AIF would no longer

comply with the provisions of the AIFM Directive, or the third

c ou n tr y A IF M w ou ld ot her w ise n o l on ge r c o mp l y wi th th e

provisions of the AIFM Directive, the competent authority shall

inform the third country AIFM without undue delay that it shall not

implement the change.

(11) Where the third country AIFM proceeds with the

implementation of the planned change, notwithstanding the

notification received pursuant to sub-regulations (9) and (10), or if

an unplanned change has taken place pursuant to the which the

third country AIFM’s management of the third country AIF no

longer complies with the provisions of the AIFM Directive or the

third country AIFM otherwise no longer complies with the

provisions of the AIFM Directive, the competent authority shall

take all due measures in accordance with the provisions of the Act

and any regulations made thereunder, including, if necessary, the

express prohibition of marketing the third country AIF.

(12) If the changes are acceptable because they do not affect the

compliance of the third country AIFM’s management of the third

country AIF with the provisions of the AIFM Directive, or the

compliance by the third country AIFM with the provisions of the

AIFM Directive, the competent authority shall, without delay,

inform ESMA in so far as the changes concern the termination of

the marketing of certain third country AIFs or additional third

country AIFs being marketed and, if applicable, the European

regulatory authorities of the host Member State of the third country

AIFM of such changes.

14. (1) A third country AIFM duly licensed in Malta may

market units or shares of a third country AIF it manages to

professional investors in a Member State or EEA State other than

Malta, as soon as the conditions prescribed in this regulation are

met

Provided that, without prejudice to Article 43 of the AIFM

Directive, AIFs managed and marketed by a third country AIFM

shall be marketed only to professional investors.

(2) In addition to the requirements prescribed in the AIFM

Directive in relation to European AIFMs, the following conditions

shall also be met for third country AIFMs

(a) appropriate cooperation arrangements are in place

between the competent authority and the supervisory

authorities of the third country where the third country

AIF is established in order to ensure at least an

efficient exchange of information, which allows the

competent authority to carry out its duties in

accordance with the provisions of the AIFM Directive;

(b) the third country where the third country AIF is

established is not listed as a Non-Cooperative Country

and Territory by FATF;

(c) the third country where the third country AIF is

established has signed an agreement with the

competent authority and with each other Member State

or EEA State in which the units or shares of the third

country AIF are intended to be marketed, which fully

complies with the standards prescribed in Article 26 of

the OECD Model Tax Convention on Income and on

Capital and ensures an effective exchange of

information in tax matters, including any multilateral

tax agreements.

(3) Where a European regulatory authority of another Member

State or EEA State disagrees with the assessment made on the

application of sub-regulation (2)(a) and (b) by the competent

authority, the European regulatory authority concerned may refer

the matter to ESMA which may act in accordance with the powers

conferred on it under Article 19 of Regulation (EU) No. 1095/2010.

(4) Where the third country AIFM duly licensed in Malta

intends to market units or shares of a third country AIF in any

Member State or EEA State other than Malta, the third country

AIFM shall submit a notification to the competent authority in

respect of the third country AIF that it intends to market. The

notification shall comprise the documentation and information

prescribed hereunder

(a) a notification letter, including a programme of

operations identifying the third country AIFs which

the third country AIFM intends to market and the

information on where the third country AIFs are

established;

(b) the third country AIF’s prospectus or equivalent rules

or instruments of incorporation;

(c) identification of the custodian of the third country

AIF;

(d) a description of, or any information on the third

country AIF available to investors;

(e) information on where the master AIF is established if

the third country AIF is a feeder AIF;

(f)

any additional information concerning the disclosure

obligations prescribed in Investment Services Rules

for each third country AIF which the third country

AIFM intends to market;

(g) the indication of the Member State or EEA State in

which it intends to market the units or shares of the

third country AIF to professional investors;

(h) information on the arrangements made for the

marketing of the third country AIFs and, where

relevant, information on the arrangements established

to prevent units or shares of the third country AIF from

being marketed to retail investors, including in the

case where the third country AIFM relies on activities

of independent entities to provide investment services

in respect of the third country AIF

Provided that the notification letter by the third country

AIFM referred to above shall be provided in a language customary

in the sphere of international finance.

(5) The competent authority shall within twenty working days

from receipt of a complete notification pursuant to sub-regulation

(4), transmit the complete notification file to the European

regulatory authorities of the Member States or EEA States where

the units or shares of the third country AIF are intended to be

marketed. The competent authority shall also enclose a statement to

the effect that the third country AIFM concerned is licensed to

manage third country AIFs with a particular investment strategy

Provided that the statement referred to above shall be

provided in a language customary in the sphere of international

finance.

(6) The competent authority shall proceed with the

transmission of the complete notification file pursuant to sub-

regulation (4), only if the third country AIFM’s management of the

third country AIF complies and will continue to comply with the

provisions of the AIFM Directive and if the third country AIFM

otherwise complies with the provisions of the AIFM Directive.

(7) Upon transmission of the notification file, the competent

authority shall, without delay, notify the third country AIFM about

the transmission. The third country AIFM may start marketing the

third country AIF in the relevant host Member State or EEA State

as of the date of that notification.

(8) The competent authority shall also inform ESMA that the

third country AIFM may start marketing the units or shares of the

third country AIF in the host Member States or EEA State of the

third country AIFM.

(9) The arrangements referred to in sub-regulation (4)(h) shall

be subject to the laws and supervision of the European regulatory

authority of the third country AIFM’s host Member State or EEA

State.

(10) In the event of a material change to any of the particulars

communicated in accordance with sub-regulation (4), the third

country AIFM shall give written notice thereof to the competent

authority at least one month prior to the implementation of the

planned change, or immediately after an unplanned change has

occurred.

(11) Where, pursuant to a planned change, the third country

AIFM’s management of the third country AIF would no longer

comply with the provisions of the AIFM Directive, or the third

c ou nt r y AI F M wo ul d o th e r wi s e no lo ng e r c om p ly w i th t he

provisions of the AIFM Directive, the competent authority shall

inform the third country AIFM without undue delay that it shall not

implement the change.

(12) Where the third country AIFM proceeds with the

implementation of the planned change, notwithstanding the

notification received pursuant to sub-regulations (10) and (11), or if

an unplanned change has taken place pursuant to which the third

country AIFM’s management of the third country AIF no longer

complies with the provisions of the AIFM Directive or the third

country AIFM otherwise no longer complies with the provisions of

the AIFM Directive, the competent authority shall take all due

measures in accordance with the provisions of the Act and any

regulations issued thereunder including, if necessary, the express

prohibition of marketing of the third country AIF.

(13) If the changes are acceptable because they do not affect the

compliance of the third country AIFM’s management of the third

country AIF with the provisions of the AIFM Directive, or the

compliance by the third country AIFM with the provisions of the

AIFM Directive, the competent authority shall, without delay,

inform ESMA in so far as the changes concern the termination of

the marketing of certain third country AIFs or additional third

country AIFs marketed and, if applicable, the European regulatory

authorities of the host Member State of the third country AIFM of

such changes.

LICENSING OF THIRD COUNTRY AIFMs AND CHOICE OF

MALTA AS ALTERNATIVE MEMBER STATE OF REFERENCE

(1) Where a third country AIFM which has been granted

an authorisation by a European regulatory authority of a Member

State or EEA State other than Malta after having deemed such

Member State or EEA State as its Member State of reference,

changes its marketing strategy within two years of its initial

authorisation, and that change would have affected the choice of its

Member State of reference to be Malta had the modified marketing

strategy been the initial marketing strategy, the third country AIFM

shall proceed as follows

(a) it shall inform the European regulatory authority of the

original Member State of reference of the change prior

to implementation; and

(b) it shall indicate Malta as being the Member State of

reference in accordance with the criteria prescribed in

Article 37(4) of the AIFM Directive based on the new

strategy.

(2) The third country AIFM shall justify its assessment by

disclosing its new marketing strategy to its original Member State

of reference.

(3) The third country AIFM shall also provide information on

its legal representative including its name and the place where it is

established

Provided that the new legal representative shall be

established in Malta.

(4) The European regulatory authority of the original Member

State of reference shall assess whether the determination of the

third country AIFM in accordance with sub-regulations (1) to (3) is

correct and shall notify ESMA thereof. The European regulatory

authority shall also provide ESMA with the third country AIFM’s

justification of its assessment regarding the choice of the new

Member State of reference and information on the third country

AIFM’s new marketing strategy.

(5) Where the European regulatory authority agrees with the

assessment made by the third country AIFM, the competent

authority shall be notified of the change by the said European

r e g u l a t o r y a u t h o r i t y, a n d s h a l l d u l y r e c e i v e a c o p y o f t h e

authorisation and the supervision file relating to the third country

AIFM

Provided that from the date of transmission to the

competent authority of the authorisation and supervision file, the

competent authority shall be competent for the licensing and

supervision of the third country AIFM.

(6) Where a third country AIFM changes its marketing strategy

after a period of two years and intends to designate Malta as its new

Member State of reference on the basis of its new marketing

strategy, it may submit a request to change its Member State of

reference to the European regulatory authorities of the original

Member State of reference. The procedure indicated in sub-

regulations (2) to (5) shall apply mutatis mutandis.

THIRD COUNTRY AIFMs HAVING AN EU OR EEA MEMBER

STATE OF REFERENCE OTHER THAN MALTA MARKETING

EU OR THIRD COUNTRY AIFs IN MALTA

(1) A third country AIFM authorised in a Member State or

EEA State other than Malta may market to professional investors in

Malta units or shares of a European AIF which it manages as soon

as the conditions prescribed in this regulation are met. In such case

the third country AIFM shall be exempt from the provisions of

article 3 of the Act, and the European AIF, if authorised in a

Member State or EEA State other than Malta, shall be exempt from

the provisions of Article 4 of the Act

Provided that, without prejudice to regulation 30, European

AIFs managed and marketed by a third country AIFM, shall be

marketed in Malta only to professional investors.

(2) Where a third country AIFM authorised in a Member State

or EEA State, other than Malta, intends to market units or shares of

the European AIF in Malta, the third country AIFM shall submit to

the European regulatory authority of the Member State or EEA

State a notification in respect of the European AIFs that it intends

to market. The notification shall comprise the documentation and

information prescribed hereunder

(a) a notification letter, including a programme of

operations identifying the European AIFs which the

third country AIFM intends to market and the

information on where the European AIFs are

established;

(b) the European AIF’s prospectus or equivalent rules or

instruments of incorporation;

(c) identification of the custodian of the European AIF;

(d) a description of, or any information on the European

AIF available to investors;

(e) information on where the master AIF is established if

the European AIF is a feeder AIF;

(f)

any additional information concerning the disclosure

obligations prescribed in Article 23(1) of the AIFM

Directive for each European AIF which the third

country AIFM intends to market;

(g) the indication of Malta as being the Member State in

which it intends to market the units or shares of the

European AIFs to investors;

(h) information on the arrangements made for the

marketing of the European AIFs and, where relevant,

information on the arrangements established to prevent

units or shares of the European AIFs from being

marketed to retail investors, including in the case

where the third country AIFM relies on activities of

independent entities to provide investment services in

respect of the European AIF

Provided that the notification letter by the third country

AIFM referred to above shall be provided in a language customary

in the sphere of international finance.

(3) The competent authority shall, no later than twenty working

days after the date of receipt of a complete notification file

p u r su an t t o s u b - r e g u l at i o n ( 2 ) , r e c e i v e f r o m t h e E u r o p ea n

regulatory authority of the third country AIFM’s home Member

State or EEA State the complete notification file.

(4) The notification file transmitted to the competent authority

shall also include a statement to the effect that the third country

AIFM concerned is authorised to manage European AIFs with a

particular investment strategy

Provided that the statement referred to above shall be

provided in a language customary in the sphere of international

finance.

(5) The competent authority shall receive the complete

notification file only if the third country AIFM’s management of

the European AIF complies with and will continue to comply with

the provisions of the AIFM Directive and if the third country AIFM

otherwise complies with the provisions of the AIFM Directive.

(6) The third country AIFM may start marketing the European

AIFs in Malta as from the date that the European regulatory

authority has notified the third country AIFM of the transmission to

the competent authority of the notification file.

(7) Arrangements referred to in sub-regulation (2)(h) shall be

subject to the laws of Malta and to the supervision of the competent

authority.

(8) In the event that the European regulatory authority accepts

a change to any of the particulars communicated in accordance with

sub-regulation (2) by the third country AIFM, the competent

authority shall receive notification thereof from the said European

regulatory authority in so far as the changes concern the

termination of the marketing of certain European AIFs or

additional European AIFs marketed.

(1) A third country AIFM duly authorised in a Member

State or EEA State other than Malta may market units or shares of a

third country AIF to professional investors in Malta as soon as the

conditions prescribed in this regulation are met. The third country

AIFM and the third country AIF shall be exempt from the

provisions of articles 3 and 4 of the Act respectively

Provided that, without prejudice to regulation 30, AIFs

managed and marketed by a third country AIFM shall be marketed

only to professional investors.

(2) Where the third country AIFM authorised in a Member

State or EEA State other than Malta intends to market units or

shares of a third country AIF in Malta, the third country AIFM

shall submit a notification to the European regulatory authority of

its home Member State or EEA State in respect of the third country

AIF that it intends to market. The notification shall comprise the

documentation and information prescribed hereunder

(a) a notification letter, including a programme of

operations identifying the third country AIFs which

the third country AIFM intends to market and the

information on where the third country AIFs are

established;

(b) the third country AIF’s prospectus or equivalent rules

or instruments of incorporation;

(c) identification of the custodian of the third country

AIF;

(d) a description of, or any information on the third

country AIF available to investors;

(e) information on where the master AIF is established if

the third country AIF is a feeder AIF;

(f)

any additional information concerning the disclosure

obligations prescribed in Investment Services Rules

for each third country AIF which the third country

AIFM intends to market;

(g) the indication of Malta as being the Member State in

which it intends to market the units or shares of the

third country AIF to professional investors;

(h) information on the arrangements made for the

marketing of the third country AIFs and, where

relevant, information on the arrangements established

to prevent units or shares of the third country AIF from

being marketed to retail investors, including in the

case where the third country AIFM relies on activities

of independent entities to provide investment services

in respect of the third country AIF

Provided that the notification letter by the third country

AIFM referred to above shall be provided in a language customary

in the sphere of international finance.

(3) The competent authority shall, no later than twenty working

days after the date of receipt by the European regulatory authority

of the third country AIFM’s home Member State or EEA State of a

complete notification file pursuant to sub-regulation (2), receive

the complete notification file from the said European regulatory

authority.

(4) The notification file transmitted to the competent authority

shall also include a statement to the effect that the third country

AIFM concerned is authorised to manage third country AIFs with a

particular investment strategy

Provided that the statement referred to above shall be

provided in a language customary in the sphere of international

finance.

(5) The competent authority shall receive the complete

notification file in terms of sub-regulation (3) only if the third

country AIFM’s management of the third country AIF complies

with and will continue to comply with the provisions of the AIFM

Directive and if the third country AIFM otherwise complies with

the provisions of the AIFM Directive.

(6) Upon transmission of the notification file to the competent

authority by the European regulatory authority, the third country

AIFM may start marketing the third country AIF in Malta as from

the date that it is notified by the European regulatory authority of

such transmission.

(7) Arrangements referred to in sub-regulation (2)(h) shall be

subject to the laws of Malta and to the supervision of the competent

authority.

(8) In the event that the European regulatory authority accepts

a change to any of the particulars communicated in accordance with

sub-regulation (2) by the third country AIFM, the competent

authority shall receive notification thereof from the said European

regulatory authority in so far as the changes concern the

termination of the marketing of certain third country AIFs or

additional third country AIFs marketed.

FREEDOM TO PROVIDE SERVICES AND FREEDOM OF

ESTABLISHMENT BY THIRD COUNTRY AIFMs HAVING

MALTA AS THEIR MEMBER STATE OF REFERENCE

(1) A third country AIFM which has been licensed in

Malta and which has appointed Malta as its Member State of

reference may directly manage a European AIF established in any

Member State or EEA State other than Malta, provided the third

country AIFM is authorised to manage that type of European AIF.

(2) A third country AIFM which has been licensed in Malta and

intending to manage a European AIF established in any Member

State or EEA State other than Malta for the first time shall

communicate the following information to the competent authority

(a) the Member State or EEA State in which it intends to

manage European AIFs directly;

(b) a programme of operations stating the particular

services which the third country AIFM intends to

perform and identifying the European AIFs it intends

to manage.

(3) The competent authority shall, within one month of

receiving the complete documentation submitted in accordance

with sub-regulation (2), transmit the complete documentation to the

European regulatory authority of the AIFM host Member State or

EEA State. The competent authority shall also enclose a statement

to the effect that the third country AIFM is in possession of a

licence granted by the competent authority

Provided that such transmission shall occur only if the third

country AIFM’s management of the European AIF complies and

will continue to comply with the provisions of the AIFM Directive

and if the third country AIFM otherwise complies with the

provisions of the AIFM Directive.

(4) The competent authority shall immediately notify the third

country AIFM about the transmission of the notification pursuant

to sub-regulation (3). The competent authority shall also inform

ESMA that the third country AIFM may start managing the

European AIF in the host Member State or EEA State of the third

country AIFM.

(5) Upon receipt of the transmitted notification by the

European regulatory authority, the third country AIFM may start

directly managing the European AIF in the host Member State or

EEA State of the third country AIFM.

(6) In the event of a change to any of the information

communicated in accordance with sub-regulation (2), the third

country AIFM shall give written notice of such change to the

competent authority at least one month before implementing the

planned change, or immediately after an unplanned change has

occurred.

(7) Where, pursuant to a planned change, the third country

AIFM’s management of the European AIF would no longer comply

with the provisions of the AIFM Directive or the third country

AIFM would otherwise no longer comply with the provisions of the

AIFM Directive, the competent authority shall inform the third

country AIFM without undue delay that it shall not implement the

change.

(8) Where the third country AIFM proceeds with the

implementation of the planned change, notwithstanding the

notification made pursuant to sub-regulations (6) and (7), or if an

unplanned change has taken place pursuant to which the third

country AIFM’s management of the AIF referred to in sub-

regulation (1) no longer complies with the provisions of the AIFM

Directive or the third country AIFM otherwise no longer complies

with the provisions of the AIFM Directive, the competent authority

shall take all due measures in accordance with the provisions of the

Act and any regulations issued thereunder, including, if deemed

necessary, the express prohibition of marketing of such European

AIFs.

(9) If the changes are acceptable because they do not affect the

compliance by the third country AIFM’s management of the

European AIF with the provisions of the AIFM Directive, or the

compliance by the third country AIFM with the provisions of the

AIFM Directive, the competent authority shall, without undue

delay, inform the European regulatory authority of the third country

AIFM host Member State or EEA State of those changes.

(1) A third country AIFM which has been licensed in

Malta and which has appointed Malta as its Member State of

reference may manage a European AIF established in any Member

State or EEA State other than Malta through the establishment of a

branch, provided the third country AIFM is authorised to manage

that type of European AIF.

(2) A third country AIFM which has been licensed in Malta and

which intends managing European AIFs in another Member State

or EEA State for the first time and establish a branch shall

communicate the following information to the competent authority

(a) the Member State or EEA State in which it intends to

establish a branch;

(b) a programme of operations stating the particular

services which the third country AIFM intends to

perform and identifying the European AIFs it intends

to manage;

(c) the organisational structure of the branch;

(d) the address in the home Member State or EEA State of

the European AIF from where documents may be

obtained;

(e) the names and contact details of the persons

responsible for the management of the branch.

(3) The competent authority shall within two months of

receiving the complete documentation submitted in accordance

with sub-regulation (2), transmit the said complete documentation

to the European regulatory authority of the host Member State or

EEA State where the third country AIFM intends establishing a

branch. The competent authority shall also enclose a statement to

the effect that the third country AIFM is licensed in terms of the

Act

Provided that such transmission shall occur only if the third

country AIFM’s management of the European AIF complies and

will continue to comply with the provisions of the AIFM Directive

and the third country AIFM itself otherwise complies with the

provisions of the AIFM Directive.

(4) The competent authority shall immediately notify the third

country AIFM about the transmission pursuant to sub-regulation

(3). The competent authority shall also inform ESMA that the third

country AIFM may start managing the European AIF in the host

Member State or EEA State of the third country AIFM.

(5) Upon receipt of the transmission notification referred to in

sub-regulation (4), the third country AIFM may start managing the

European AIF in the host Member State or EEA State of the third

country AIFM.

(6) In the event of a change to any of the information

communicated in accordance with sub-regulation (2), the third

country AIFM shall give written notice of such change to the

competent authority at least one month before implementing the

planned change, or immediately after an unplanned change has

occurred.

(7) Where, pursuant to a planned change, the third country

AIFM’s management of the European AIF would no longer comply

with the provisions of the AIFM Directive or the third country

AIFM itself would otherwise no longer comply with the provisions

of the AIFM Directive, the competent authority shall inform the

third country AIFM without undue delay that shall not implement

the change.

(8) Where the third country AIFM proceeds with the

implementation of the planned change, notwithstanding the

notification received pursuant to sub-regulations (6) and (7), or if

an unplanned change has taken place pursuant to which the third

country AIFM’s management of the AIF referred to in sub-

regulation (1) no longer complies with the provisions of the AIFM

Directive or the third country AIFM otherwise no longer complies

with the provisions of the AIFM Directive, the competent authority

shall take all due measures in accordance with the provisions of the

Act and any regulations issued thereunder, including, if necessary,

the express prohibition of marketing of such European AIFs.

(9) If the changes are acceptable because they do not affect the

compliance of the third country AIFM’s management of the

European AIF with the provisions of the AIFM Directive, or the

compliance by the third country AIFM with the provisions of the

AIFM Directive, the competent authority shall, without undue

delay, inform the European regulatory authority of the third country

AIFM host Member State or EEA State of those changes.

FREEDOM TO PROVIDE SERVICES AND FREEDOM OF

ESTABLISHMENT BY THIRD COUNTRY AIFMs HAVING AS

THEIR MEMBER STATE OF REFERENCE A MEMBER STATE

OR EEA STATE OTHER THAN MALTA

(1) A third country AIFM which has been authorised in a

Member State or EEA State other than Malta and which has

appointed such Member State or EEA State as its Member State of

reference may directly manage a European AIF in Malta provided

the said AIFM is authorised to manage that type of European AIF.

(2) A third country AIFM authorised in a Member State or EEA

State other than Malta and intending to directly manage European

AIFs in Malta for the first time shall communicate the following

information to the European regulatory authority in its home

Member State or EEA State and shall thereafter be exempt from the

provisions of Article 3 of the Act

(a) the intention to manage European AIFs directly in

Malta;

(b) a programme of operations stating the particular

services which the third country AIFM intends to

perform and identifying the European AIFs it intends

to manage.

(3) The competent authority shall, within one month from

submission by the third country AIFM to the European regulatory

authority of the complete documentation in accordance with sub-

regulation (2), receive the complete documentation from the

European regulatory authority of the third country AIFM’s home

Member State or EEA State. The competent authority shall receive

a statement to the effect that the third country AIFM is authorised

in terms of the AIFM Directive

Provided that such transmission shall occur only if the third

country AIFM’s management of the European AIF complies and

will continue to comply with the provisions of the AIFM Directive

and the third country AIFM otherwise complies with the provisions

of the AIFM Directive.

(4) Upon notification by the European regulatory authority of

the home Member State or EEA Member State of the third country

AIFM of the transmission notification referred to in sub-regulation

(3), the third country AIFM may start to provide its services in

Malta.

(5) The competent authority shall not impose any additional

requirements on the third country AIFM concerned in respect of

matters which are covered by the AIFM Directive.

(6) In the event of a change, accepted by the European

regulatory authority, to any of the information communicated in

accordance with sub-regulation (2), which changes do not affect the

compliance by the third country AIFM’s management of the

European AIF with the provisions of the AIFM Directive or the

compliance by the third country AIFM of the provisions of the

AIFM Directive, the competent authority shall receive notification

of such changes from the European regulatory authority of the

home Member State or EEA State of the third country AIFM.

(1) A third country AIFM which has been authorised in a

Member State or EEA State other than Malta and which has

appointed such Member State or EEA State as its Member State of

reference may manage a European AIF in Malta through the

establishment of a branch, provided the AIFM is authorised to

manage that type of AIF.

(2) A third country AIFM intending to manage European AIFs

in Malta for the first time through the establishment of a branch

shall communicate the following information to the European

regulatory authority in its home Member State or EEA State and

shall thereafter be exempt from the provisions of Article 3 of the

Act

(a) the intention to establish a branch in Malta;

(b) a programme of operations stating the particular

services which the AIFM intends to perform and

identifying the AIFs it intends to manage;

(c) the organisational structure of the branch;

(d) the address in the home Member State of the AIF from

where documents may be obtained;

(e) the names and contact details of the persons

responsible for the management of the branch.

(3) The competent authority shall, within two months from

submission by the third country AIFM of the complete

documentation to the European regulatory authority of the third

country AIFM’s home Member State or EEA State in accordance

with sub-regulation (2), receive the complete documentation from

such European regulatory authority. The competent authority shall

receive a statement from the said European regulatory authority to

the effect that the third country AIFM is authorised in terms of the

AIFM Directive

Provided that such transmission shall occur only if the third

country AIFM’s management of the European AIF complies and

will continue to comply with the provisions of the AIFM Directive

and the third country AIFM otherwise complies with the provisions

of the AIFM Directive.

(4) Upon notification to the third country AIFM by the

European regulatory authority of the home Member State or EEA

State of the third country AIFM of the transmission notification,

the third country AIFM may start managing the European AIF in

Malta.

(5) The competent authority shall not impose any additional

requirements on the third country AIFM concerned in respect of

matters which are covered by the AIFM Directive.

(6) In the event of a change, accepted by the European

regulatory authority, to any of the information communicated in

accordance with sub-regulation (2), which changes do not affect the

compliance by the third country AIFM’s management of the

European AIF with the provisions of the AIFM Directive or the

compliance by the third country AIFM of the provisions of the

AIFM Directive, the competent authority shall receive notification

of such changes from the European regulatory authority of the

home Member State or EEA State of the third country AIFM.

THIRD COUNTRY AIFMs MARKETING UNITS

OR SHARES OF AIFs IN MALTA

(1) Without prejudice to regulation 30, a third country

AIFM may market, only to professional investors within the

territory of Malta, units or shares of a third country AIF or a

European AIF which is registered in another Member State or EEA

State other than Malta and which it manages. The third country AIF

and the third country AIFM shall be exempt from the provisions of

articles 3 and 4 of the Act respectively

Provided that at least the following conditions shall be

satisfied

(a) the third country AIFM complies with Articles 22, 23

and 24 of the AIFM Directive in respect of each AIF

marketed by it pursuant to this regulation and with

Articles 26 to 30 of the AIFM Directive where an AIF

marketed by it pursuant to this regulation is one of the

following

(i)

one or more AIFs managed by third country

AIFMs, where such AIFs either individually or

jointly on the basis of an agreement aimed at

acquiring control, acquire control of a non-listed

company in accordance with Article 26(5) of the

AIFM Directive;

(ii) AIFs managed by third country AIFMs jointly,

where such third country AIFMs cooperate with

one or more other AIFMs on the basis of an

agreement pursuant to which the AIFs managed

by those AIFMs jointly acquire control of a non-

listed company in accordance with Article 26(5)

of the AIFM Directive

Provided that the term ‘competent authorities’ and

‘AIF investors’ referred to in articles 22, 23, 24, 26 to

30 shall be deemed to refer to the competent authority

and to the investors in Malta;

(b) appropriate cooperation arrangements for the purpose

of systemic risk oversight and in line with

international standards are in place between the

competent authority, in so far as applicable, the

European regulatory authorities of the European AIFs

concerned and the supervisory authorities of the third

country where the third country AIFM and, in so far as

applicable, the supervisory authorities of the third

country where the third country AIF is established in

order to ensure an efficient exchange of information

that allows the competent authority to carry out its

duties in accordance with the provisions of the AIFM

Directive;

(c) the third country where the third country AIFM or the

third country AIF is established is not listed as a Non-

Cooperative Country and Territory by the FATF.

(2) Where a European regulatory authority of a European AIF

does not enter into the required cooperation arrangements as

prescribed in sub-regulation (1)(b) within a reasonable period of

time, the competent authority may refer the matter to ESMA which

may act in accordance with the powers conferred on it under

Article 19 of Regulation (EU) No 1095/2010.

(3) The competent authority may, for the purposes of this

regulation, impose stricter rules on the third country AIFM in

respect of the marketing of units or shares of AIFs to investors in

Malta.

POWERS AND DUTIES OF THE COMPETENT AUTHORITY

(1) The competent authority shall be responsible for the

prudential supervision of any Maltese AIFM or third country AIFM

licensed in Malta, whether the AIFM manages and, or markets AIFs

in another Member State or EEA State or not, without prejudice to

the provisions of the AIFM Directive which confer the

responsibility for supervision on the European regulatory authority

of the host Member State or EEA State of the AIFM.

(2) The supervision of the AIFM’s compliance with Articles 12

and 14 of the AIFM Directive shall be the responsibility of the

European regulatory authority of the host Member State or EEA

State where the AIFM manages and, or markets AIFs through a

branch in that Member State or EEA State.

(3) Where an AIFM is managing and, or marketing AIFs in a

Member State or EEA State other than Malta whether or not

through a branch, and is in breach of one of the regulatory

requirements for which the European regulatory authority is

responsible for ensuring compliance, the competent authority shall

receive notification from the European regulatory authority of the

host Member State or EEA State of the request made to the AIFM

to put an end to that breach.

(4) If the AIFM refuses to provide the European regulatory

authority with information necessary for the supervision of the

AIFM’s compliance with the applicable regulatory requirements of

such European regulatory authority, or fails to take the necessary

steps to put an end to breach referred to in sub-regulation (3), the

competent authority shall be duly informed of such matter by the

European regulatory authority.

(5) Where the competent authority receives a notification from

a European regulatory authority pursuant to sub-regulation (4), the

competent authority shall, at the earliest opportunity

(a) take all appropriate measures to ensure that the AIFM

concerned provides the information requested by the

European regulatory authority of the host Member

State or EEA State, pursuant to sub-regulation (4) or

puts an end to the breach referred to in sub-regulation

(3);

(b) request the necessary information from the relevant

supervisory authorities in third countries

Provided that the competent authority shall communicate to

the European regulatory authority of the host Member State or EEA

State the nature of the measures taken pursuant to paragraph (a).

(6) Where the AIFM continues to refuse to provide the

information requested by the European regulatory authority in the

host Member State or EEA State pursuant to sub-regulation (4) or

persists in breaching the legal or regulatory provisions referred to

in sub-regulation (3) in force in the host Member State or EEA

State, despite the measures taken by the competent authority, or due

to the inadequacy or unavailability of such measures in Malta, the

competent authority shall be notified of the measures that are

proposed to be taken by the European regulatory authority of the

host Member State or EEA State against the AIFM to prevent or

penalise further irregularities by the AIFM and, in so far as

necessary, to prevent that AIFM from initiating any further

transactions in the host Member State or EEA State.

(7) Where the AIFM is in breach of obligations resulting from

provisions in relation to which the European regulatory authority in

the host Member State or EEA State has no responsibility for

supervising compliance, the competent authority shall receive

notification of such breach from the European regulatory authority

in the host Member State or EEA State.

(8) The competent authority shall take appropriate measures

including, if necessary, request additional information from the

relevant supervisory authorities in the third countries.

(9) Where an AIFM persists in acting in a manner that is

clearly prejudicial to the interests of the investors of the relevant

AIF, the financial stability or the integrity of the market in the

Member State or EEA State, despite the measures taken by the

competent authority, or due to the inadequacy of such measures in

Malta or because the competent authority fails act within a

reasonable time, the competent authority shall receive notification

from the European regulatory authority of the host Member State or

EEA State of any measures that are proposed to be taken in order to

protect the investors of the relevant AIF, the financial stability and

integrity of the market in the host Member State or EEA State

including the possibility of preventing the AIFM concerned to

further market the units or shares of the relevant AIF in the host

Member State or EEA State.

(10) The procedure prescribed in sub-regulations (7) to (9) shall

also apply in the event that the European regulatory authority of the

AIFM host Member State or EEA State has clear and demonstrable

grounds for disagreement with the licensing of a third country

AIFM by the competent authority.

(1) The competent authority may require a European

AIFM or a third country AIFM licensed in a Member State or EEA

State other than Malta managing or marketing AIFs in Malta,

whether or not through a branch, to provide the information

necessary for the supervision of the AIFM’s compliance with the

applicable provisions of the AIFM Directi ve for which the

competent authority is responsible

Provided that the requirements imposed shall not be more

stringent than those which the competent authority imposes on

Maltese AIFMs for monitoring compliance with the same

provisions.

(2) Where the competent authority ascertains that an AIFM

managing and, or marketing European AIFs in Malta, whether or

not through a branch, is in breach of one of the provisions in

relation to which the competent authority is responsible for

supervising compliance, the competent authority shall require the

AIFM to put an end to that breach and shall proceed to notify the

European regulatory authority of the home Member State or EEA

State thereof.

(3) If the AIFM concerned refuses to provide the competent

authority with information for which it is responsible, or fails to

take the necessary steps to put an end to the breach identified in

sub-regulation (2), the competent authority shall inform the

European regulatory authority of its home Member State or EEA

State thereof

Provided that the European regulatory authority shall notify

the competent authority of any measures taken.

(4) Where an AIFM continues in its refusal to provide

information requested by the competent authority in terms of sub-

regulation (1), or persists in breaching the legal or regulatory

provisions referred to in sub-regulation (2) in force in Malta,

despite the measures taken by the European regulatory authority of

the home Member State or EEA State or due to the inadequacy or

unavailability of such measures in the said home Member State or

EEA State, the competent authority may, after informing the

European regulatory authority of the home Member State or EEA

State of the European AIFM, take appropriate measures under the

provisions of the Act and any regulations made thereunder, to

prevent or penalise further irregularities and, in so far as necessary,

to prevent the AIFM from initiating any further transactions in

Malta. Where the function carried out in Malta by the AIFM is the

management of AIFs, the competent authority may require that the

AIFM ceases managing those AIFs.

(5) Where the competent authority has clear and demonstrable

grounds for believing that an AIFM is in breach of the obligations

arising from provisions in relation to which the competent authority

has no responsibility for supervising compliance, the competent

authority shall refer those findings to the European regulatory

authority of the home Member State or EEA State of the AIFM,

which shall take appropriate measures, including, if necessary,

requesting additional information from the relevant supervisory

authorities in third countries.

(6) Where an AIFM persists in acting in a manner that is

clearly prejudicial to the interests of the investors of the relevant

AIF, the financial stability or the integrity of the Maltese market,

despite the measures taken by the European regulatory authority in

the home Member State or EEA State of the AIFM, or due to the

inadequacy of such measures in the Member State or EEA State or

because the European regulatory authority fails to act within a

reasonable time, the competent authority may, after informing the

European regulatory authority in the home Member State or EEA

State, take all appropriate measures needed in order to protect the

investors of the relevant AIF, the financial stability and integrity of

the Maltese market, including the possibility of preventing the

AIFM concerned to further market the units or shares of the

relevant AIF in Malta.

(7) The procedure prescribed in sub-regulations (5) and (6)

shall also apply in the event that the competent authority has clear

and demonstrable grounds for disagreement with the authorisation

of a third country AIFM by the Member State of reference.

(8) Where the competent authority disagrees on any of the

measures taken by a European regulatory authority pursuant to sub-

regulations (2) to (7), it may bring the matter to the attention of

ESMA, which may act in accordance with the powers conferred to

it under Article 19 of Regulation (EU) No 1095/2010.

(9) In so far as applicable, ESMA shall facilitate the

negotiation and conclusion of the cooperation arrangements

required by the AIFM Directive between the competent authority,

the European regulatory authorities and the supervisory authorities

of third countries.

The supervision of a European AIFM or third country

AIFM’s compliance with Articles 12 and 14 of the AIFM Directive

shall be the responsibility of the competent authority where the

AIFM manages and or markets AIFs through a branch in Malta.

(1) The competent authority shall immediately provide a

copy of the relevant cooperation arrangements entered into by it in

accordance with Articles 35, 37 and, or 40 of the AIFM Directive

to the host Member State of the AIFM concerned.

(2) The competent authority shall, in accordance with

procedures relating to the applicable technical regulatory standards

referred to in Article 35(14), Article 37(17) or Article 40(14) of the

AIFM Directive, forward the information received from third-

country supervisory authorities in accordance with cooperation

arrangements with such supervisory authorities in respect of an

AIFM or, where relevant pursuant to regulation 23(6) to (8), to the

European regulatory authorities of the host Member State of the

AIFM concerned.

(3) Where, in the application of regulations 4, 5 and 6, a

European regulatory authority rejects a request to exchange

information in accordance with the regulatory technical standards

which shall be issued by ESMA in terms of sub-regulation (2) to

specify the procedure for coordination and exchange of information

between the competent authority and the European regulatory

authorities of the AIFM’s host Member State or EEA State, the

competent authority may refer the matter to ESMA, which may act

in accordance with the powers conferred on it under Article 19 of

Regulation (EU) No 1095/2010.

(4) Where in the application of regulations 13 and 14, a

European regulatory authority rejects a request to exchange

information in accordance with the regulatory technical standards

which shall be issued by ESMA in terms of sub-regulation (2) to

specify the procedure for coordination and exchange of information

between the competent authority of the Member State of reference

and the European regulatory authorities of the AIFM’s host

Member State or EEA State, the competent authority, where Malta

is appointed Member State of reference, may refer the matter to

ESMA, which may act in accordance with the powers conferred on

it under Article 19 of Regulation (EU) No 1095/2010.

Where Malta is the host Member State of a third country

AIFM, and the competent authority considers that the contents of

th e c o o p e r a ti o n a r r a n ge m e nt e nt e r e d i n to b y th e E u r o pe a n

regulatory authority of the home Member State or EEA State of the

AIFM concerned in accordance with Articles 35, 37 and, or 40 does

not comply with what is required pursuant to the applicable

regulatory technical standards, the competent authority may refer

the matter to ESMA which may act in accordance with the powers

conferred on it under Article 19 of Regulation (EU) No. 1095/2010.

(1) Where the competent authority is satisfied that a

transfer of any data and the analysis of such data is necessary for

the purpose of the AIFM Directive, the competent authority may

transfer to an overseas regulatory authority such data and analysis

on a case-by-case basis, where the conditions laid down in

Directive 95/46/EC are met.

(2) The competent authority may, where it deems fit, expressly

authorise the said overseas regulatory authority to transfer such

data to another overseas regulatory authority. Such authorisation

shall be provided in writing.

(1) The competent authority shall make every effort to

comply with guidelines and recommendations issued by ESMA in

terms of Article 38 of the AIFM Directive.

(2) Within two months of the issuance of a guideline or

recommendation, the competent authority shall confirm whether it

complies or intends to comply with such guideline or

recommendation. In the event that the competent authority does not

comply or intend to comply, it shall inform ESMA, stating its

reasons.

THIRD COUNTRY AIFMs MARKETING EUROPEAN OR

THIRD COUNTRY AIFs TO RETAIL INVESTORS IN MALTA

(1) An AIF shall not be marketed to retail investors in

Malta unless it is in possession of an authorisation for this purpose

from the competent authority.

(2) Regulations 4, 5, 6, 8, 11, 12, 13, 14, 16, and 17 shall, in so

far as applicable, apply mutatis mutandis, and reference to the term

"professional investors" shall be deemed to be a reference to "retail

investors" subject to such variations or modifications as may be

prescribed.

(3) Where an AIF is to be marketed to retail investors in Malta,

the AIF and its AIFM shall be subject to Investment Services

Rules, which shall prescribe the following

(a) the types of AIF with respect to which an application

for marketing to retail investors may be made to the

competent authority;

(b) the manner and form of an application for an

authorisation to market an AIF to retail investors in

Malta, including the imposition of an application fee,

where applicable;

(c) the conditions for authorisation for marketing to retail

investors;

(d) the on-going obligations applicable to the marketing of

an AIF to retail investors in Malta, including the

imposition of a supervision fee, where applicable; and

(e) any other relevant matter determined by the competent

authority.

(4) In the Investment Services Rules, the competent authority

may impose stricter requirements on the AIFM or the AIF than the

requirements applicable to the AIFs marketed to professional

investors in Malta in accordance with the provisions of the AIFM

Directive. The competent authority shall not, however, impose

stricter or additional requirements on European AIFs established in

Member State or EEA State other than Malta and marketed on a

cross-border basis than on AIFs marketed in Malta.

(5) The competent authority shall, by 22 July 2014, inform the

European Commission and ESMA of

(a) the types of AIF which AIFMs may market to retail

investors in Malta; and

(b) any additional requirements that Malta imposes for the

marketing of AIFs to retail investors.

Provided that the competent authority shall also inform the

European Commission and ESMA of any subsequent changes with

regard to this sub-regulation.

TRANSITORY PROVISIONS

(1) Regulation 7 and regulation 22 shall cease to apply as

from such date as the Minister may by notice in the Gazette

establish.

(2) Overseas based collective investment schemes, which on

the date of the coming into force of these regulations were licensed

in terms of the article 4 of the Act, shall be deemed to be a third

country AIF for the purpose of these regulations

Provided that such collective investment schemes shall

conform to all investment services rules, conditions, directives and

guidelines issued by the competent authority for such purpose.

(3) Overseas based collective investment schemes shall without

delay either surrender their licence to the competent authority or

submit such licence thereto for the appropriate amendments, as the

case may be, in accordance with requirements established by the

competent authority for this purpose.