FINANCIAL INSTITUTIONS ACT (CONSUMER CREDIT) REGULATIONS (consumercredit)

SUBSIDIARY LEGISLATION 376.09

FINANCIAL INSTITUTIONS ACT (CONSUMER

CREDIT) REGULATIONS

*

LEGAL NOTICE 266 of 2025.

(1)

The title of these regulations is the Financial

Institutions Act (Consumer Credit) Regulations.

(2)

The scope of these regulations is to apply the relevant

provisions of Directive 2008/48/EC of the European Parliament and of

the Council of 23 April 2008 on credit agreements for consumers and

repealing Council Directive 87/102/EEC, in so far as applicable to

creditors as herein defined, and consequently these regulations shall be

interpreted and applied accordingly and read in conjunction with the

Consumer Credit Regulations, where applicable, as specified in these

regulations.

(3)

These regulations establish a common framework for

certain aspects of laws, regulations and administrative provisions

concerning credit agreements covering credit for consumers falling

within the scope of these regulations in accordance with regulation 4.

(4)

These regulations shall come into force on such a date or

dates as the Minister responsible for finance may by notice in the

Gazette establish and different dates nay be so established for different

provisions and, or purposes of these regulations.

(regulation 9)

STANDARD EUROPEAN CONSUMER CREDIT

INFORMATION

(*) This information is optional for the creditor.

Wherever "if applicable" is indicated, the creditor must fill in

the box if the information is relevant to the credit product or delete the

respective information or the entire row if the information is not

relevant for the type of credit considered.

Indications between square brackets provide explanations for

the creditor and must be replaced with the corresponding information.

1. Identity and contact details of the creditor/credit

intermediary

Creditor

[Identity]

FINANCIAL INSTITUTIONS ACT (CONSUMER CREDIT)

Address

[Geographical address to be used by

the consumer]

Telephone number (*)

E-mail address (*)

Fax number (*)

Web address (*)

If applicable

Credit intermediary

[Identity]

Address

[Geographical address to be used by

the consumer]

Telephone number (*)

E-mail address (*)

Fax number (*)

Web address (*)

2. Description of the main features of the credit product

The type of credit

The total amount of credit

This means the ceiling, or the

total sums made available under

the credit agreement.

The conditions governing the

drawdown

This means how and when you

will obtain the money.

The duration of the credit

agreement

FINANCIAL INSTITUTIONS ACT (CONSUMER CREDIT)

You will have to pay the following

Instalments and, where

appropriate, the order in which

[The amount, number and 

instalments will be allocated

frequency of payments to be made

by the consumer]

Interest and/or charges will be paya-

ble in the following manner

The total amount you will have to [Sum of total amount of credit and to-

tal cost of credit]

pay

This means the amount of

borrowed capital plus interest

and possible costs related to your

credit.

If applicable

The credit is granted in the form

of a deferred payment for a good

or service or is linked to the

supply of specific goods or the

provision of a service

Name of good/service

Cash price

If applicable

[Kind of sureties]

Sureties required

This is a description of the

security to be provided by you in

relation to the credit agreement.

If applicable

Repayments do not give rise to

immediate amortisation of the

capital.

FINANCIAL INSTITUTIONS ACT (CONSUMER CREDIT)

3. Costs of the credit

[percentage (%)

The borrowing rate or, if

applicable, different borrowing

- fixed, or

rates which apply to the credit

agreement

- variable (with the index or refer-

ence rate applicable to the initial bor-

rowing rate),

- periods]

[percentage (%) A representative ex-

Annual Percentage Rate of

ample mentioning all the 

Charge (APR)

assumptions used for calculating the

This is the total cost expressed as rate to be set out here]

an annual percentage of the total

amount of credit. The APR is

there to help you compare

different offers.

Is it compulsory, in order to

obtain the credit or to obtain it on

the terms and conditions

marketed, to take out

-

an insurance policy Yes/no [if yes, specify the kind of in-

securing the credit? or

surance]

-

another

ancillary Yes/no [if yes, specify the kind of

service contract?

ancillary service]

If the costs of these services are

not known by the creditor they are

not included in the APR.

Related costs

If applicable

Maintaining one or more accounts

is required for recording both

payment transactions and

drawdowns

If applicable

Amount of costs for using a

specific means of payment (e.g. a

credit card)

If applicable

Any other costs deriving from the

credit agreement

If applicable

Conditions under which the

above-mentioned costs related to

the credit agreement can be

changed

If applicable

Obligation to pay notarial fees

Costs in the case of late payments You will be charged 

[…… (applicable interest rate and

arrangements for its adjustment and,

Missing payments could have

severe consequences for you (e.g. where applicable, default charges)]

forced sale) and make obtaining for missing payments.

credit more difficult.

4. Other important legal aspects

Yes/no

Right of withdrawal

You have the right to withdraw

from the credit agreement within

a period of 14 calendar days.

Early repayment

You have the right to repay the

credit early at any time in full or

partially.

If applicable

[Determination of the 

The creditor is entitled to

compensation in the case of early compensation (calculation method)

in accordance with regulation 22]

repayment

FINANCIAL INSTITUTIONS ACT (CONSUMER CREDIT)

Consultation of a database

The creditor must inform you

immediately and without charge

of the result of a consultation of a

database, if a credit application is

rejected on the basis of such a

consultation. This does not apply

if the provision of such

information is prohibited by

European Community law or is

contrary to objectives of public

policy or public security.

Right to a draft credit agreement

You have the right, upon request,

to obtain a copy of the draft credit

agreement free of charge. This

provision does not apply if the

creditor is at the time of the

request unwilling to proceed to

the conclusion of the credit

agreement with you.

If applicable

The period of time during which This information is valid from … 

the creditor is bound by the pre- until …

contractual information

5. Additional information in the case of distance

marketing of financial services

If applicable

(a)

concerning the creditor

If applicable

FINANCIAL INSTITUTIONS ACT (CONSUMER CREDIT)

[Identity]

Representative of the creditor in

[Geographical address to be used by

your Member State of residence

the consumer]

Address

Telephone number (*)

E-mail address (*)

Fax number (*)

Web address (*)

If applicable

[The trade register in which the cred-

Registration

itor is entered and his 

registration number or an 

equivalent means of identification in

such register]

If applicable

The supervisory authority

(b) concerning the credit

agreement

If applicable

[Practical instructions for 

Exercise of the right of

exercising the right of withdrawal in-

withdrawal

dicating, inter alia, the period for ex-

ercising the right, the address to

which notification of exercise of the

right of withdrawal should be sent

and the consequences of 

non-exercise of such right]

The law taken by the creditor as a

basis for the establishment of

relations with you before the

conclusion of the credit contract

If applicable

[Relevant clause to be set out here]

Clause stipulating the governing

law applicable to the credit

agreement and/or the competent

court

If applicable

Information and contractual terms

Language regime

shall be supplied in [specific 

language]. With your consent, we in-

tend to communicate in [specific lan-

guage/languages] during the 

duration of the credit agreement.

(c) concerning redress

Existence of and access to out-of- [Whether or not there is an out-of-

court complaint and redress 

court complaint and redress

mechanism for the consumer who is

a party to the distance contract and, if

so, the methods of access to it]

(1)

In these regulations, unless the context otherwise

requires

"Act" means the Financial Institutions Act;

''annual percentage rate of charge'' means the total cost of

the credit to the consumer, expressed as an annual percentage of

the total amount of credit;

''Authority'' shall have the same meaning as assigned to it

in the Malta Financial Services Authority Act;

"consumer" means a natural person who, in transactions

covered by these regulations, is acting either in his own

personal capacity or for the purposes of carrying out his trade,

business or profession;

''Consumer Credit Directive'' means Directive 2008/48/

EC of the European Parliament and of the Council of 23 April

2008 on credit agreements for consumers and repealing Council

*Not yet in force.

FINANCIAL INSTITUTIONS ACT (CONSUMER CREDIT)

Directive 87/102/EEC, as may be amended from time to time;

"creditor" means a company that holds a licence issued

by the Authority in accordance with article 5 of the Act, by

virtue of which it is licensed to grant, or promise to grant credit;

"credit agreement" means an agreement whereby a

creditor grants or promises to grant to a consumer, credit in the

form of a deferred payment, loan or other similar financial

accommodation, except for agreements for the provision on a

continuing basis of services or for the supply of goods of the

same kind, where the consumer pays for such services or goods

for the duration of their provision by means of instalments;

"credit intermediary" means a natural or legal person

who is not acting as a creditor and who, in the course of his

trade, business or profession, for a fee, which may take a

pecuniary form or any other agreed form of financial

consideration

(a)

presents or offers credit agreements to

consumers;

(b)

assists

consumers

by

undertaking

preparatory work in respect of credit agreements other

than as referred to in paragraph (a); or

(c)

concludes

credit

agreements

with

consumers on behalf of the creditor;

''European creditor'' means a payment institution

in accordance with the Payment Services Directive, or an

electronic money institution in accordance with the

Electronic Money Directive authorised by its European

regulatory authority in a Member State to grant, or

promise to grant credit, and which has exercised its right

to establish a branch or to provide services in Malta;

''Financial Institutions Rules'' shall have the same

meaning as assigned to it in the Act;

"Financial Services Tribunal" means the tribunal

established under article 21 of the Malta Financial Services

Authority Act;

"Member State" shall have the same meaning as assigned

to it in the Act;

"overdraft facility" means an explicit credit agreement

whereby a creditor makes available to a consumer funds which

exceed the current balance in the consumer’s current account;

"overrunning" means a tacitly accepted overdraft

whereby a creditor makes available to a consumer funds which

exceed the current balance in the consumer’s current account or

the agreed overdraft facility;

"total amount of credit" means the ceiling or the total

sums made available under a credit agreement;

(2)

Words and expressions used in these regulations which

are also used in the Consumer Credit Directive and, or the Act, but

which are not defined herein, shall have the same meaning as assigned

to them in the said Directive and the Act.

(regulation 10)

EUROPEAN CONSUMER CREDIT INFORMATION FOR

(1)

overdrafts

(2)

debt conversion

(*) This information is optional for the creditor.

Wherever "if applicable" is indicated, the creditor must fill in

the box if the information is relevant to the credit product or delete the

respective information or the entire row if the information is not

relevant for the type of credit considered.

Indications between square brackets provide explanations for

the creditor and must be replaced with the corresponding information.

1. Identity and contact details of the creditor/credit

intermediary

Creditor

[Identity]

Address

[Geographical address to be used by

the consumer]

Telephone number (*)

E-mail address (*)

Fax number (*)

Web address (*)

FINANCIAL INSTITUTIONS ACT (CONSUMER CREDIT)

If applicable

Credit intermediary

[Identity]

Address

[Geographical address to be used by

the consumer]

Telephone number (*)

E-mail address (*)

Fax number (*)

Web address (*)

2. Description of the main features of the credit product

The type of credit

The total amount of credit

This means the ceiling or the total

sums made available under the

credit agreement.

If applicable

You may be requested to repay

the amount of credit in full on

demand at any time.

3. Costs of the credit

[percentage (%)

The borrowing rate or, if

- fixed, or

applicable, different borrowing

rates which apply to the credit

- variable (with the index or refer-

agreement

ence rate applicable to the initial bor-

rowing rate)

If applicable

FINANCIAL INSTITUTIONS ACT (CONSUMER CREDIT)

[percentage (%) A representative ex-

Annual Percentage Rate of

ample mentioning all the 

Charge (APR) (*)

assumptions used for calculating the

This is the total cost expressed as rate to be set out here]

an annual percentage of the total

amount of credit. The APR is

there to help you compare

different offers.

If applicable

[The costs applicable from the time

Costs

the credit agreement is concluded]

If applicable

The conditions under which those

costs may be changed

Costs in the case of late payments You will be charged 

[…… (applicable interest rate and ar-

rangements for its adjustment and,

where applicable, default charges)]

for missing payments.

4. Other important legal aspects

[The conditions and procedure for

Termination of the credit

terminating the credit agreement]

agreement

Consultation of a database

The creditor must inform you

immediately and without charge

of the result of a consultation of a

database if a credit application is

rejected on the bases of such a

consultation. This does not apply

if the provision of such

information is prohibited by

European Community law or is

contrary to objectives of public

policy or public security.

If applicable

The period of time during which This information is valid from … un-

the creditor is bound by the pre- til…

contractual information

FINANCIAL INSTITUTIONS ACT (CONSUMER CREDIT)

5. Additional information to be given where the pre-

contractual information relates to a consumer credit for debt

conversion

If applicable

Instalments and, where

You will have to pay the following

appropriate, the order in which

[Representative example of an in-

instalments will be allocated

stalment table including the amount,

number and frequency of payments

to be made by the 

consumer]

The total amount you will have to

pay

Early repayment

You have the right to repay the

credit early at any time in full or

partially.

If applicable

[Determination

of

the

The creditor is entitled to

compensation in the case of early compensation (calculation method)

in accordance with regulation 22]

repayment

6. Additional information in the case of distance

marketing of financial services

If applicable

(a)

concerning the creditor

If applicable

[Identity]

Representative of the creditor in

[Geographical address to be used by

your Member State of residence

the consumer]

Address

Telephone number (*)

E-mail address (*)

Fax number (*)

Web address (*)

If applicable

FINANCIAL INSTITUTIONS ACT (CONSUMER CREDIT)

[The trade register in which the cred-

Registration

itor is entered and his 

registration number or an equivalent

means of identification in such regis-

ter]

If applicable

The supervisory authority

(b) concerning the credit

agreement

Yes/No

Right of withdrawal

You have the right to withdraw

from the credit agreement within

a period of 14 running days

If applicable

[Practical instructions for 

Exercise of the right of

exercising the right of withdrawal in-

withdrawal

dicating, inter alia, the address to

which notification of the exercise of

withdrawal should be sent and the

consequences of non-exercise of that

right]

If applicable

The law taken by the creditor as a

basis for the establishment of

relations with you before the

conclusion of the credit contract

If applicable

[Relevant Clause to be set out here]

Clause stipulating the governing

law applicable to the credit

agreement and/or the competent

court

If applicable

Information and contractual terms

Language regime

will be supplied in [specific 

language]. With your consent, we in-

tend to communicate in [specific lan-

guage/languages] during the 

duration of the credit agreement.

(c)

concerning redress

Existence of and access to out-of- [Whether or not there is an out-of-

court complaint and redress 

court complaint and redress

mechanism

mechanism for the consumer who is

party to the distance contract and, if

so, the methods of access to it]

(1) The Authority established by article 3 of the Malta

Financial Services Authority Act shall be the designated competent

authority in Malta responsible for the implementation of the Consumer

Credit Directive, insofar as applicable to financial institutions duly

licensed by the same.

(2)

The Authority shall, with respect to credit agreements

marketed, distributed or sold in or from Malta, monitor the compliance

of creditors and credit intermediaries with the provisions of these

regulations and any Financial Institutions Rules made thereunder.

(3)

For the better implementation of the Consumer Credit

Directive, the Authority may exercise any of the powers assigned to it

under the Act.

(4)

For the better carrying out of these regulations, the

Authority may, from time to time, issue and publish Financial

Institutions Rules, in accordance with article 13 of the Act, and such

rules shall be binding on creditors and other persons as may be

specified therein.

(regulation 9)

I.

The basic equation expressing the equivalence of

drawdowns on the one hand and repayments and charges on the other.

The basic equation, which establishes the annual percentage rate

of charge (APR), equates on an annual basis, the total present value of

drawdowns on the one hand and the total present value of repayments

and payments of charges on the other hand, i.e.:

Where

∑

is the APR,

M

is the number of the last drawdown,

K

is the number of a drawdown, thus 1 ≤ k ≤ m,

is the amount of drawdown

is the interval, expressed in years and fractions of a year,

between the date of the first drawdown and the date of each

subsequent drawdown, thus = 0,

is the number of the last repayment or payment of

charges,

l

is the number of a repayment or payment of charges,

is the amount of a repayment or payment of charges,

is the interval, expressed in years and fractions of a year,

between the date of the first drawdown and the date of each repayment

or payment of charges.

Remarks

(a)

The amounts paid by both parties at different times shall

not necessarily be equal and shall not necessarily be paid at equal

intervals.

(b)

The starting date shall be that of the first drawdown.

(c)

Intervals between dates used in the calculations shall be

expressed in years or in fractions of a year. A year is presumed to have

365 days (or 366 days for leap years), 52 weeks or 12 equal months.

An equal month is presumed to have 30.41666 days (i.e. 365/12)

regardless of whether or not it is a leap year.

(d)

The result of the calculation shall be expressed with an

accuracy of at least one decimal place. If the figure at the following

decimal place is greater than or equal to 5, the figure at that particular

decimal place shall be increased by one.

(e)

The equation can be rewritten using a single sum and the

concept of flows (Ak), which shall be positive or negative, in other

words either paid or received during periods 1 to k, expressed in years,

i.e.

S

being the present balance of flows. If the aim is to

maintain the equivalence of flows, the value shall be zero.

II.

The additional assumptions for the calculation of the

annual percentage rate of charge shall be as follows

(a)

If a credit agreement gives the consumer freedom

of drawdown, the total amount of credit shall be deemed to be

drawn down immediately and in full.

(b)

If a credit agreement gives the consumer freedom

of drawdown in general but imposes, amongst the different

ways of drawdown, a limitation with regard to the amount of

credit and period of time, the amount of credit shall be deemed

to be drawn down on the earliest date provided for in the credit

agreement and in accordance with those drawdown limits.

(c)

If a credit agreement provides different ways of

drawdown with different charges or borrowing rates, the total

amount of credit shall be deemed to be drawn down at the

highest charge and borrowing rate applied to the most common

drawdown mechanism for this type of credit agreement.

(d)

In the case of an overdraft facility, the total

amount of credit shall be deemed to be drawn down in full and

for the whole duration of the credit agreement. If the duration of

the overdraft facility is not known, the annual percentage rate of

charge shall be calculated on the assumption that the duration of

the credit is three (3) months.

(e)

In the case of an open-end credit agreement, other

than an overdraft facility, it shall be assumed that

(i)

the credit is provided for a period of one

year starting from the date of the initial drawdown, and

that the final payment made by the consumer clears the

balance of capital, interest and other charges, if any;

(ii)

the capital is repaid by the consumer in

equal monthly payments, commencing one (1) month

after the date of the initial drawdown. However, in cases

where the capital must be repaid only in full, in a single

payment, within each payment period, successive

drawdowns and repayments of the entire capital by the

consumer shall be assumed to occur over the period of

one (1) year. Interest and other charges shall be applied

in accordance with those drawdowns and repayments of

capital and as provided for in the credit agreement

Provided that for the purposes of this

paragraph, an open-end credit agreement is a credit

agreement without fixed duration and includes credits

which must be repaid in full within or after a period but,

once repaid, become available to be drawn down again.

(f)

In the case of credit agreements other than

overdrafts and open-end credits as referred to in the

assumptions established in paragraphs (d) and (e)

(i)

if the date or amount of a repayment of

capital to be made by the consumer cannot be

ascertained, it shall be assumed that the repayment is

made at the earliest date provided for in the credit

agreement and is for the lowest amount for which the

credit agreement provides;

(ii)

if the date of conclusion of the credit

agreement is not known, the date of the initial drawdown

shall be assumed to be the date which results in the

shortest interval between such date and the date of the

first payment to be made by the consumer.

FINANCIAL INSTITUTIONS ACT (CONSUMER CREDIT)

(g)

Where the date or amount of a payment to be

made by the consumer cannot be ascertained on the basis of the

credit agreement or the assumptions established in paragraphs

(d), (e) or (f), it shall be assumed that the payment is made in

accordance with the dates and conditions required by the

creditor and, when these are unknown

(i)

interest charges are paid together with the

repayments of capital;

(ii)

a non-interest charge expressed as a single

sum is paid at the date of the conclusion of the credit

agreement;

(iii) non-interest charges expressed as several

payments are paid at regular intervals, commencing with

the date of the first repayment of capital, and if the

amount of such payments is not known they shall be

assumed to be equal amounts;

(iv) the final payment clears the balance of

capital, interest and other charges, if any.

(h)

If the ceiling applicable to the credit has not yet

been agreed, that ceiling is assumed to be €1500.

(i)

If different borrowing rates and charges are

offered for a limited period or amount, the borrowing rate and

the charges shall be deemed to be the highest rate for the whole

duration of the credit agreement.

(j)

For consumer credit agreements for which a fixed

borrowing rate is agreed in relation to the initial period, at the

end of which a new borrowing rate is determined and

subsequently periodically adjusted according to an agreed

indicator, the calculation of the annual percentage rate shall be

based on the assumption that, at the end of the fixed borrowing

rate period, the borrowing rate is the same as at the time of

calculating the annual percentage rate, based on the value of the

agreed indicator at that time.

(1)

These regulations shall apply to credit agreements

covering credit for consumers insofar as the said credit agreements are

granted or promised to be granted by creditors as defined in regulation

2. (2)

Specific provisions shall apply limitedly to the following

credit agreements, as follows

(a)

only regulations 1, 2, 3, 5, 6(3), 6(4), 7(1), 7(2)(a)

to (d), 10 to 13, 14, 15(4), 15(5), 21, 24 and 26 to 28 shall apply

to an overdraft facility and where the credit has to be repaid on

demand or within three (3) months; or

(b)

only regulations 1 to 5, 25, 27 and 28 shall apply

to an overrunning;

(c)

only regulations 1 to 4, 6(3), 6(4), 7, 14 the

application of regulation 9(a) to (f), (h), (i), and (m) in so far as

FINANCIAL INSTITUTIONS ACT (CONSUMER CREDIT)

the information to be included in credit agreements, regulations

10, 11, 13, 14(3), 15(1) limitedly to the requirement of a credit

agreement to be drawn up in writing or on a durable medium,

regulations 15(1)(b), 15(2), 16, 19, 22 and 25 to 28 shall apply

to credit agreements which provide for arrangements to be

agreed by the creditor and the consumer in respect of deferred

payments or repayment methods, where the consumer is already

in default on the initial credit agreement, and where

(i)

such arrangements would be likely to avert

the possibility of legal proceedings concerning such

default; and

(ii)

the consumer would not thereby be subject

to terms which are less favourable than those established

in the initial credit agreement.

Without prejudice to regulation 4, these regulations shall

not apply to credit agreements

entered into before 1 st October 2010

(a)

Provided that open-end credit agreements which

were entered into before 1 st October 2010 shall be regulated by

regulations 16, 18, 19, 24, 25(2) and 25(3);

(b)

which are secured by a hypothec, privilege, or

land registry charge, or by a right related to immovable

property;

(c)

the purpose of which is to acquire or retain

property rights over land and or over an existing or projected

building;

(d)

involving a total amount of credit less than two

hundred euro (€200) or more than seventy-five thousand euro

(€75,000)

Provided that, notwithstanding this provision,

these regulations shall apply to unsecured credit agreements the

purpose of which is the renovation of a residential immovable

property involving a total amount of credit above seventy-five

thousand euro (€75,000);

(e)

relating to hiring or leasing where an obligation to

purchase the object of the agreement is not stipulated either by

the agreement itself or by a separate agreement. Such an

obligation shall be deemed to exist if it is so decided

unilaterally by the creditor;

(f)

in the form of an overdraft facility and where the

credit has to be repaid within one (1) month, without prejudice

to regulation 11;

(g)

where the credit is granted free of interest and

without any other charges;

(h)

under the terms of which the credit has to be

repaid within three (3) months and only insignificant charges

are payable;

(i)

where the credit is granted by an employer to his

employees as a secondary activity free of interest or at annual

percentage rates of charge which are lower than those

prevailing on the market and which are not offered to the

public;

(j)

which are concluded with European investment

firms as defined in article 2 of the Investment Services Act or

with banks or credit institutions or electronic money institutions

as defined in article 2 of the Banking Act for the purpose of

allowing an investor to carry out a transaction relating to one or

more of the instruments listed in the Second Schedule to the

Investment Services Act where the European investment firm

or bank or credit institution or electronic money institution

granting the credit is involved in such transaction;

(k)

which are the outcome of a settlement reached in

court or before another statutory authority;

(l)

which relate to the deferred payment, free of

charge, of an existing debt;

(m) upon the conclusion of which the consumer is

requested to deposit an item as security in the creditor’s safe-

keeping and where the liability of the consumer is strictly

limited to that pledged item; and

(n)

which relate to loans granted to a restricted public

under a statutory provision with a general interest purpose and

at lower interest rates than those prevailing on the market or

free of interest or on other terms which are more favourable to

the consumer than those prevailing on the market and at interest

rates not higher than those prevailing on the market.

(1)

A creditor shall take all the necessary steps to

ensure full compliance with these regulations.

(2)

Unless otherwise provided, the obligations of the creditor

shall equally apply to a European creditor, and a credit intermediary

where a credit intermediary presents or offers credit agreements to

consumers, assists consumers by undertaking preparatory work in

respect of credit agreements, or concludes credit agreements with

consumers on behalf of the creditor.

(3)

Where a credit intermediary participates or intends to

participate in accordance with sub-regulation (2), a credit intermediary

shall

(a)

indicate in advertising and documentation

intended for consumers, the extent of his powers, in particular

whether he works exclusively with one or more creditors or as

an independent broker;

(b)

disclose the fee, if any, payable by the consumer

for his services, which fee shall be agreed to in writing or on a

durable medium between the consumer and the credit

intermediary before the conclusion of the credit agreement; and

(c)

disclose the fee, if any, payable by the consumer

to the credit intermediary for his services to the creditor for the

purpose of calculating the annual percentage rate of charge.

(4)

Regulations 8 to 11 shall not apply to suppliers of goods

or services acting as credit intermediaries in an ancillary capacity

Provided that this is without prejudice to the creditor’s

obligation to ensure that the consumer receives the pre-contractual

information referred to in regulations 9 and 10.

(1)

Without prejudice to the provisions relating to

unfair commercial practices under the Consumer Affairs Act, any

advertising concerning credit agreements which indicates an interest

rate or any figure relating to the cost of the credit to the consumer, the

advertisement shall include standard information by means of a

representative example in accordance with sub-regulation (2).

(2)

The representative example referred to in sub-regulation

(1) shall specify and comprise in a clear, concise and prominent way,

the following items of information

(a)

the borrowing rate, whether fixed, or variable or

both, together with particulars of any charges included in the

total cost of credit to the consumer;

(b)

the total amount of credit;

(c)

the annual percentage rate of charge except in the

case of credit agreements referred to in regulation 4(2)(a);

(d)

the duration of the agreement;

(e)

in the case of credit in the form of a deferred

payment for specific goods or services, the cash price and the

amount of any advance payment;

(f)

if applicable, the total amount payable by the

consumer; and

(g)

if applicable, the amount of each repayment of

credit.

(3)

(a)

An advertisement concerning credit agreements

shall include a clear and concise statement in respect of any obligation

to enter into a contract in respect of an ancillary service relating to the

credit agreement, in particular an insurance service, where

(i)

the conclusion of that service is

compulsory in order to obtain the credit or to obtain it on

the terms and conditions advertised; and

(ii)

the cost of that service cannot be

determined in advance.

(b)

The obligation referred to in paragraph (a) shall be

advertised in a prominent way and accompanied by the annual

percentage rate of charge.

(1)

In good time before a credit agreement is

concluded, a creditor, and where applicable a credit intermediary, on

the basis of the credit terms and conditions offered by the creditor, and

taking into account the preferences expressed and information

supplied by the consumer, shall provide to the consumer the

information identified under regulation 9, in order to assist the

consumer in comparing different offers and reaching an informed

decision on whether to conclude a credit agreement with the creditor

or otherwise.

(2)

With respect to credit agreements falling under

regulation 9, a creditor and, where applicable, a credit intermediary,

shall provide adequate explanations to the consumer in order to place

the consumer in a position enabling him to assess whether the

proposed credit agreement is adapted to his needs and financial

situation, where appropriate by explaining the pre-contractual

information provided under regulation 9, the essential characteristics

of the products proposed and specific effects they may have on the

consumer, including the consequences of default in payment by the

consumer.

(1)

The information to be disclosed by a creditor or

credit intermediary to consumers under regulation 8(1), other than

consumers whose credit agreement is regulated by regulations 10 and

11, shall specify

(a)

the type of credit to be provided under the

agreement;

FINANCIAL INSTITUTIONS ACT (CONSUMER CREDIT)

(b)

the identity and geographical address of the

creditor and, where applicable, of the credit intermediary;

(c)

the total amount of credit to be provided under the

agreement and the conditions governing the drawdown of

credit;

(d)

the duration of the credit agreement;

(e)

in the case of credit in the form of deferred

payment for specific goods or services or linked-credit

agreements, the goods, services and the cash price thereof;

(f)

the borrowing rate, the conditions governing the

application of that rate and, where available, any index or

reference rate applicable to the initial borrowing rate, as well as

the periods, conditions, and procedures for changing the

borrowing rate; and if different rates apply in different

circumstances, the above information shall be supplied in

respect of all the applicable rates;

(g)

the annual percentage rate of charge and the total

amount payable by the consumer illustrated by means of a

representative example mentioning all the assumptions used in

order to calculate such rate. Where the consumer has informed

the creditor of one or more components of his preferred credit,

such as the duration of the credit agreement and the total

amount of credit, the creditor shall take those components into

account; if a credit agreement provides different ways of

drawdown with different charges or borrowing rates and the

creditor uses the assumptions provided in point (b) of Part II of

the Third Schedule, he shall indicate that other drawdown

mechanisms for this type of credit agreement may result in

higher annual percentage rates of charge;

(h)

the amount, number and frequency of payments to

be made by the consumer and where appropriate, the order in

which payments shall be allocated to different outstanding

balances charged at different borrowing rates for the purpose of

reimbursement;

(i)

where applicable, the charges for maintaining one

or several accounts recording both payment transactions and

drawdowns, unless the opening of an account is optional, and

the charges for using a means of payment for both payment

transactions and drawdowns;

(j)

where applicable, any other charges deriving from

a credit agreement and the conditions under which those

charges may be changed;

(k)

where applicable, a statement that fees shall be

payable by the consumer to a notary public on conclusion of the

credit agreement;

(l)

the obligation, if any, to enter into a contract for

ancillary services relating to the consumer credit agreement, in

particular insurance services, where the conclusion of such a

contract is compulsory in order to obtain the credit or to obtain

it on the terms and conditions marketed;

(m) the interest rate applicable in the case of late

payments and the arrangements for its adjustment, and where

applicable, any charges payable for default;

(n)

a warning relating to the consequences of missing

payments;

(o)

where applicable, the sureties which need to be

identified by the consumer;

(p)

in the case of a credit agreement under which

payments made by a consumer do not give rise to an immediate

corresponding amortisation of the total amount of credit, but are

used to constitute capital during periods and under conditions

provided in the credit agreement or in an ancillary agreement, a

clear and concise statement that such credit agreements do not

provide for a guarantee of repayment of the total amount of

credit drawn down under the credit agreement unless such a

guarantee is given;

(q)

the existence or absence of a right of withdrawal;

(r)

the consumer’s right of early repayment, and

where applicable the creditor’s right to compensation and the

way in which compensation is to be determined in accordance

with regulation 22;

(s)

the consumer’s right to be informed immediately

and free of charge pursuant to regulation 13(2) of the result of a

database consultation carried out for the purposes of assessing

creditworthiness;

(t)

if applicable, the period of time during which the

creditor is bound by the pre-contractual information; and

(u)

the right of the consumer to be supplied, on

request and free of charge from the creditor with a copy of the

draft credit agreement. This provision shall not apply if the

creditor is at the time of the request unwilling to proceed to the

conclusion of the credit agreement with the consumer.

(2)

The information under sub-regulation (1) shall be

provided by means of the Standard European Consumer Credit

Information form contained in the First Schedule

Provided that the creditor shall be deemed to have

discharged the obligation of providing information under this

regulation and of providing information under regulations 5(1) and (2)

of the Distance Selling (Retail Financial Services) Regulations, if the

creditor has supplied the information in the form contained in the First

Schedule.

(3)

If the creditor provides the consumer with additional

information to that listed in sub-regulation (1), a separate document

shall be provided for this purpose and shall be annexed to the form

contained in the First Schedule.

(4)

Where the credit agreement references a benchmark as

defined in regulation 2(1) of the Malta Financial Services Authority

Act (Indices used as benchmarks in financial instruments and financial

contracts or to measure the performance of investment funds)

Regulations, the name of the benchmark and of its administrator and

the potential implications on the consumer shall be provided by the

creditor, or where applicable, by the credit intermediary, to the

consumer in a separate document, which may be annexed to the form

contained in the First Schedule.

(5)

In the case of voice telephony communications as

referred to in regulation 5(3) of the Distance Selling (Retail Financial

Services) Regulations, the description of the main characteristics of

the financial services to be provided pursuant to regulation 5(3)(a)(ii)

of the said regulations shall specify, at least

(a)

the total amount of credit and the conditions

governing the drawdown;

(b)

the duration of the credit agreement;

(c)

the goods, services and the cash price in the case

of credit in the form of deferred payment for specific goods or

services or linked credit agreements;

(d)

the borrowing rate, the conditions governing the

application of that rate and, where available, any index or

reference rate applicable to the initial borrowing rate, as well as

the periods, conditions and procedure for changing the

borrowing rate; and if different rates apply in different

circumstances, the above information shall be supplied in

respect of all the applicable rates;

(e)

the amount, number and frequency of payments to

be made by the consumer and where appropriate, the order in

which payments shall be allocated to different outstanding

balances charged at different borrowing rates for the purpose of

reimbursement;

(f)

the annual percentage rate of charge illustrated by

means of a representative example; and

(g)

the total amount payable by the consumer.

(5)

If the agreement has been concluded at the consumer’s

request using a means of distance communication which does not

enable the information to be provided in accordance with sub-

regulation (1), in particular in the case referred to in sub-regulation

(4), the creditor shall provide the consumer with the full pre-

contractual information, using the form contained in the First

Schedule, immediately after the conclusion of the credit agreement.

(1)

In the case of a credit agreement which takes the

form of an overdraft facility and where the credit has to be repaid on

demand or within three (3) months, the creditor and where applicable,

the credit intermediary, shall within reasonable time before the credit

agreement is entered into, provide to the consumer on the basis of the

credit terms and conditions offered by the creditor and, if applicable,

the preferences expressed and information supplied by the consumer,

in order to enable him to compare different offers to take an informed

decision on whether to conclude a credit agreement, with information

which shall specify

(a)

the type of credit to be provided under the

agreement;

(b)

the identity and geographical address of the

creditor and, where applicable, of the credit intermediary;

(c)

the total amount of credit to be provided under the

agreement;

(d)

the duration of the credit agreement;

(e)

the borrowing rate, the conditions governing the

application of that rate and any index or reference rate

applicable to the initial borrowing rate, the charges applicable

from the time the credit agreement is concluded, and where

applicable, the conditions under which those charges may be

changed;

(f)

the conditions and procedure for terminating the

credit agreement;

(g)

where applicable, an indication that the consumer

may be requested to repay the amount of credit in full at any

time;

(h)

the interest rate applicable in the case of late

payment and the arrangements for its adjustment, and where

applicable, any charges payable for default;

(i)

the charges applicable from the time the

agreement is concluded and, where applicable, the conditions

under which those charges may be changed;

(j)

the right of the consumer to be informed

immediately and free of charge in accordance with regulation

13(2) of the result of a database consultation carried out for the

purposes of assessing creditworthiness; and

(k)

if applicable, the period of time during which the

creditor is bound by the pre-contractual information.

(2)

The information under sub-regulation (1) shall be

provided on paper or on another durable medium and all information

shall be equally prominent and by means of the Standard European

Consumer Credit Information form in the First Schedule

Provided that, the creditor shall be deemed to have

discharged the obligation of providing information under this

regulation and the information under regulation 5(1) and (2) of the

Distance Selling (Retail Financial Services) Regulations, if the

creditor has supplied the information contained in the Second

Schedule.

(3)

In the case of voice telephony communication and where

the consumer requests that the overdraft facility be made available

with immediate effect, the description of the main characteristics of

the financial service shall include at least the items identified under

sub-regulation (1)(c), (e) and (g). In addition, in credit agreements of

the kind referred to in sub-regulation (4), the description of the main

characteristics shall include a specification of the duration of the credit

agreement.

(4)

In the case of a credit agreement as referred to in

regulation 4(2)(c) the creditor shall provide the consumer with

(a)

the information provided for under sub-regulation

(1)(a) to (f), (h), (j), (k);

(b)

the amount, number and frequency of payments to

be made by the consumer and, where appropriate, the order in

which payments shall be allocated to different outstanding

balances charged at different borrowing rates for the purposes

of reimbursement;

(c)

the right to early repayment, and where

applicable, information concerning the creditor’s right to

compensation and the way in which such compensation shall be

determined; and

(d)

the annual percentage of charge, illustrated by

means of representative examples, mentioning all the

assumptions used in order to calculate that rate

Provided that where the credit agreement is in the

form of an overdraft facility and where the credit has to be

repaid on demand or within three (3) months, it shall be

regulated by sub-regulation (1).

(5)

If the agreement has been concluded at the request of the

consumer using a means of distance communication which does not

enable the information to be provided in accordance with sub-

regulations (1), (2) and (4), including in the cases referred to in sub-

regulation (3), the creditor shall immediately, after the conclusion of

the credit agreement, fulfil his obligations under sub-regulations (1),

(2) and (4) by providing the contractual information in accordance

with regulation 15 in so far as such regulation is applicable.

Notwithstanding regulation 5(2)(f), in relation to credit

agreements in the form of an overdraft facility and where the credit has

to be repaid within one (1) month, in the case of voice telephony

communication and where the consumer requests that the overdraft

facility be made available with immediate effect, the description of the

main characteristics of the financial service shall include at least the

items identified under regulation 10(1)(c), (e) and (g).

(1)

Before the conclusion of a credit agreement, the

creditor shall assess the creditworthiness of the consumer on the basis

of sufficient information, where appropriate, obtained from the said

consumer and, where necessary on the basis of a consultation of the

relevant database.

(2)

If the parties agree to change the total amount of credit

after the conclusion of the credit agreement, the creditor shall

(a)

update the financial information at his disposal

concerning the consumer; and

(b)

assess the consumer’s creditworthiness, before the

total amount of credit is significantly increased.

(1)

A European creditor who intends to or has entered

into a credit agreement with a consumer in Malta, shall have access

under the same conditions as a creditor, to the databases which are

available in Malta in order to assess the creditworthiness of the

consumer

Provided that a request by a creditor or a European

creditor for access to the said database shall not be conditioned in a

discriminatory manner but may be refused by the holder of the database

if the information to be provided is prohibited by any other law or is

contrary to the public policy or public security of Malta.

(2)

If the credit application is rejected on the basis of

consultation of a database, the creditor shall inform the consumer

immediately and without charge of the result of such consultation and

of the particulars of the database consulted.

(3)

This regulation is without prejudice to the application of

Regulation (EU) 2016/679 of the European Parliament and of the

Council of 27 April 2016 on the protection of natural persons with

regard to the processing of personal data and on the free movement of

such data, and repealing Directive 95/46/EC (General Data Protection

Regulation) and the Data Protection Act, as applicable.

(1)

The consumer shall be entitled to receive, free of

charge, and upon request, a copy of the draft consumer credit

agreement.

(2)

Sub-regulation (1) shall not apply if the creditor is, at the

time of the consumer’s request, unwilling to proceed with the

conclusion of the credit agreement with the consumer.

(3)

Upon conclusion of the consumer credit agreement, all

contracting parties shall be entitled to receive a copy of the final credit

agreement.

(1)

The consumer credit agreement referred to in

regulation 14(3) shall be drawn up in writing or on a durable medium

and shall specify, in a clear and concise manner, the following

(a)

the information listed under regulation 9(1)(a), (c)

to (f), (h), (i), (j), (n) and (o);

(b)

the identities and geographical addresses of the

contracting parties as well as, if applicable, the identity and

geographical address of the credit intermediary involved;

(c)

the annual percentage rate of charge and the total

amount payable by the consumer calculated at the time that the

credit agreement is concluded

Provided that, all the assumptions used in

calculating that rate shall be mentioned;

(d)

where capital amortisation of a credit agreement

with a fixed duration is involved, the right of the consumer to

receive, on request and free of charge, at any time throughout

the duration of the credit agreement, a statement of account in

the form of an amortisation table, which shall

(i)

indicate the payments owing and the

periods and conditions relating to the payment of such

amounts;

(ii)

contain a breakdown of each repayment

showing capital amortisation, the interest calculated on

the basis of the borrowing rate and where applicable any

additional costs;

(iii) where the interest is not fixed or the

additional costs may be changed under the credit

agreement, it shall indicate clearly and concisely that the

data contained in the table shall remain valid only until

such time as the borrowing rate or the additional costs

are changed in accordance with the credit agreement;

(e)

an indication, where applicable, that the consumer

may, at any time, upon demand, be requested to repay the

amount of credit in full;

(f)

the interest rate applicable in the case of late

payments as applicable at the time of the conclusion of the

credit agreement and the arrangement for its adjustment and,

where applicable, any charges payable for default;

(g)

the existence or absence of a right of withdrawal

together with conditions attached to such right, which

conditions shall include

(i)

the period during which the right may be

exercised;

(ii)

the information concerning the obligation

of the consumer to pay the capital drawn down and the

interest in accordance with regulation 20(3)(b); and

(iii)

the amount of interest payable per day;

(h)

information concerning the rights resulting in

accordance with regulations 21 and 22 and the conditions

attached to those rights;

(i)

the procedure to be followed in exercising the

right of termination of the credit agreement;

(j)

whether or not there is an out-of-court procedure

for the consumer to make a complaint, the redress mechanism

available and the methods for having access to it;

(k)

where applicable, the name and address of the

competent supervisory authority;

(l)

where applicable, other contractual terms and

conditions; and

(m) where applicable, a statement, that notarial fees

shall be payable by the consumer.

(2)

In the case of a credit agreement under which payments

made by the consumer do not give rise to an immediate corresponding

amortisation of the total amount of credit, but are used to constitute

capital during periods and under the conditions stipulated in the credit

agreement or in an ancillary agreement annexed thereto, the

information listed in sub-regulation (1) shall, unless a guarantee is

provided, include a clear and concise statement that such credit

agreements do not provide a guarantee of repayment of the total

amount of credit drawn down under the credit agreement.

(3)

Where sub-regulation (1)(d) applies, the creditor shall

make available to the consumer, free of charge and at any time

throughout the duration of the credit agreement, a statement of account

in the form of an amortisation table.

(4)

In the case of a credit agreement under which payments

made by the consumer do not give rise to an immediate corresponding

amortisation of the total amount of credit, but are used to constitute

capital during periods and under conditions stipulated in the credit

agreement or in an ancillary agreement, the information required in

accordance with sub-regulation (1) or sub-regulation (5), as

applicable, shall include a clear and concise statement that such credit

agreements do not provide for a guarantee of repayment of the total

amount of credit drawn down under the credit agreement, unless such

a guarantee is given.

(5)

In the case of a credit agreement which takes the form of

an overdraft facility where credit has to be repaid on demand or within

three (3) months, the agreement shall specify, in a clear and precise

manner, the following information

(a)

the type of credit;

(b)

the identities and geographical addresses of the

contracting parties, and where applicable, of the credit

intermediary involved;

(c)

the total amount of the credit and the conditions

governing the drawdown;

(d)

the borrowing rate, the conditions governing the

application of that rate, and where available any index or

reference rate applicable to the initial borrowing rate, as well as

the periods, conditions and procedure for changing the

borrowing rate

Provided that if different borrowing rates apply in

different circumstances, the information in this paragraph shall

be made applicable to all the respective rates;

(e)

an indication that the consumer may, at any time,

upon demand be requested to repay the amount of credit in full;

(f)

conditions relating to the exercise of the right of

withdrawal from the credit agreement;

(g)

information concerning the charges applicable

from the time the agreement is concluded and, where

applicable, the conditions under which those charges may be

changed; and

(h)

the duration of the credit agreement.

(1)

Where applicable, the consumer shall be informed

of any change in the borrowing rate, on paper or another durable

medium, before the change enters into force. The information shall

state the amount of the payments to be made after the entry into force

of the new borrowing rate and, if the number or frequency of the

payments changes, the details thereof.

(2)

Notwithstanding sub-regulation (1), the parties may

agree in the credit agreement that the information referred to in sub-

regulation (1) is to be given to the consumer periodically where all of

the following conditions are fulfilled

(a)

the change in the borrowing rate is caused by a

change in a reference rate;

(b)

the new reference rate is made publicly available

by appropriate means which may include a publication on the

creditor’s website or a public advert; and

(c)

the information concerning the new reference rate

is also kept available in the premises of the creditor.

Without prejudice to other obligations provided for in

these regulations, prior to modifying the terms and conditions of the

credit agreement, the creditor shall communicate the following

information to the consumer

(a)

a clear description of the proposed changes and,

where applicable, of the need for consumer consent or of the

changes introduced by operation of law;

(b)

the time period for the implementation of the

changes referred to in paragraph (a);

(c)

the means for complaint available to the consumer

FINANCIAL INSTITUTIONS ACT (CONSUMER CREDIT)

regarding the changes referred to in paragraph (a);

(d)

the time period available for the filing of any such

complaint;

(e)

the name and address of the Arbiter for Financial

Services as established in accordance with the Arbiter for

Financial Services Act before whom the consumer may submit

the said complaint.

(1)

Where the credit agreement covers credit in the

form of an overdraft facility

(a)

the consumer shall be entitled to be kept regularly

informed in writing or on a durable medium by means of a

statement of account of

(i)

the precise period to which the statement of

account relates;

(ii)

the amounts and dates of drawdowns;

(iii) the balance from the previous statement

and the date thereof;

(iv)

the new balance;

(v)

the dates and amounts of payments made

by the consumer;

(vi)

the borrowing rate applied;

(vii)

any charges that have been applied; and

(viii) where applicable, the minimum amount to

be paid;

(b)

in the event of a change in the borrowing rate or in

any charges payable, the provisions of regulation 16 shall apply.

(1)

A consumer shall be entitled to terminate an open-

end credit agreement at any time and free of charge.

(2)

A credit agreement may however provide for a period of

notice not exceeding one (1) month before termination by the

consumer.

(3)

If provided for in the credit agreement, the creditor may

terminate an open-end consumer credit agreement by giving the

consumer not less than two (2) months’ notice in writing or on a

durable medium.

(4)

If provided for in the credit agreement, a creditor may,

for objectively justified reasons terminate the right of the consumer to

drawdown credit under an open-end consumer credit agreement

Provided that, for the purpose of this sub-regulation

"objectively justified reasons" include, suspicion by the creditor that

the consumer is involved in an unauthorised or fraudulent use of the

credit granted, or that there is a significant risk that the consumer shall

be unable to fulfil his obligation to pay the credit.

(5)

In the event of a termination in accordance with sub-

regulation (4), the creditor shall inform the consumer of the

termination and the reasons for it on paper or on another durable

medium, where possible before the termination and at the latest

immediately thereafter, unless the provision of information would be

contrary to public policy or public security or is deemed to be

unlawful.

(1)

The consumer has a right to withdraw from a

credit agreement without providing any reasons.

(2)

The right of the consumer to withdraw from a credit

agreement shall be exercised within fourteen (14) running days, which

period starts to run either

(a)

from the day of the conclusion of the credit

agreement; or

(b)

from the day when the consumer receives the

contractual terms and conditions and information in accordance

with regulation 15 if that day is later than the date referred to in

paragraph (a).

(3)

If the consumer exercises his right of withdrawal, he

shall

(a)

in order to give effect to the withdrawal before the

expiry of the period specified in sub-regulation (2), notify the

creditor in accordance with the information given to the

consumer under regulation 15(1)(g) by means which may be

proven according to law. The deadline shall be deemed to have

been satisfied if that notification, if in writing or on a durable

medium that is available and accessible to the creditor, is

dispatched before the deadline expires; and

(b)

repay to the creditor the credit provided and pay

the interest accrued on it, to be calculated on the basis of the

borrowing rate specified in the credit agreement, from the date

the credit was drawn down until the date it is repaid, without

any undue delay and not later than thirty (30) running days after

giving a notification in accordance with paragraph (a)

FINANCIAL INSTITUTIONS ACT (CONSUMER CREDIT)

Provided that, the creditor shall not be entitled to

any other compensation from the consumer in the event of

withdrawal, except compensation for any non-refundable

charges paid by the creditor to any public administrative body.

(4)

Where an ancillary service relating to a consumer credit

agreement is provided by the creditor or by a third party on the basis of

an agreement between the third party and the creditor, the consumer

shall not be bound by the ancillary service agreement if the consumer

exercises his right of withdrawal in accordance with this regulation.

(5)

Regulations 7 and 8 of the Distance Selling (Retail

Financial Services) Regulations shall not apply to sub-regulations (1)

to (4).

(6)

Sub-regulations (1) to (4) shall not apply to credit

agreements which by law are required to be concluded before a Notary

Public

Provided that the non-application of sub-regulations (1)

to (4) is subject to confirmation by the Notary Public that the

consumer is guaranteed the rights provided for under regulations 9 and

15.

(1)

Where the consumer has exercised a right of

withdrawal, concerning a contract for the supply of goods or services,

he shall no longer be bound by a linked credit agreement.

(2)

A consumer shall have the right to take action against the

grantor of credit where

(a)

in order to buy goods or obtain services, the

consumer enters into a credit agreement with a creditor other

than the supplier of such goods or services;

(b)

the grantor of the credit and the supplier of the

goods or services have a pre-existing agreement where credit is

made exclusively by that grantor of credit to customers of that

supplier for the acquisition of goods or services from that

supplier;

(c)

the consumer referred to in paragraph (a) obtains

his credit pursuant to that pre-existing agreement;

(d)

the goods or services covered by the linked credit

agreement are either not supplied, are supplied only in part, or

are not in conformity with the contract for the supply thereof;

and

(e)

the consumer has pursued his remedies against the

supplier but has failed to obtain the remedy to which he is

entitled to according to the law or the contract for the supply of

goods or services.

(1)

The consumer shall have the right to discharge his

obligations under a consumer credit agreement, in full or in part,

before the agreed termination.

(2)

In the event of early repayment of credit

(a)

the consumer shall be entitled to a reduction of

total costs of the credit consisting of the interest and the costs

for the remaining duration of the credit; and

(b)

the creditor shall be entitled to a fair and

objectively justified compensation for possible costs directly

linked to early repayment of credit so long as the early

repayment falls within a period for which the borrowing rate is

fixed.

(3)

The compensation referred to in accordance with sub-

regulation (2)(b) may not exceed

(a)

one percent (1%) of the amount of credit repaid

early, if the period of time between the early repayment and the

agreed termination of the credit agreement exceeds one (1)

year; and

(b)

zero point five percent (0.5%) of the amount of

credit repaid early, if the period of time between the early

repayment and the agreed termination of the credit agreement

does not exceed one (1) year.

(4)

(a)

The limitations in accordance with sub-regulation

(3) in terms of the amount of compensation which may be claimed by

the creditor shall exceptionally not apply if the creditor proves that the

loss suffered from early repayment exceeds the amount determined

under the said sub-regulation (3); and

(b)

The consumer may claim a corresponding reduction to

the compensation claimed by the creditor if the compensation claimed

exceeds the loss actually suffered

Provided that the loss suffered shall consist of the

difference between the initial agreed interest rate and the interest rate

at which the creditor may lend out the money repaid early on the

market at the time of early repayment. Consideration shall also be

given to the impact of early repayment on administrative costs.

(5)

Compensation for early repayment in accordance with

sub-regulation (2)(b) shall not apply

(a)

if the repayment has been made under an

insurance contract intended to provide a credit repayment

guarantee;

(b)

in the case of an overdraft facility;

(c)

if the repayment falls within a period for which

the borrowing rate is not fixed; or

(d)

if the amount of early repayment does not exceed

three thousand euro (€3,000) within any period of twelve (12)

months.

(6)

A creditor may not claim compensation which is in

excess of the amount of interest which the consumer would have paid

during the period between the early repayment and the agreed date of

termination of the credit agreement.

(1)

Creditors shall have adequate policies and

procedures to ensure that they make efforts to exercise, where

appropriate, reasonable forbearance before enforcement proceedings

are initiated. Such forbearance measures shall take into account,

among other elements, the circumstances of the consumer and may

consist of, among other possibilities

(a)

a total or partial refinancing of a credit agreement;

(b)

a modification of the existing terms and

conditions of a credit agreement, which may include among

others

(i)

extending the term of the credit agreement;

(ii)

changing the type of credit agreement;

(iii) deferring payment of all or part of the

instalment repayment for a period;

(iv)

changing the interest rate;

(v)

offering a payment holiday;

(vi)

partial repayments;

(vii)

currency conversions;

(viii)

partial forgiveness and debt consolidation.

(2)

Where the creditor is permitted to define and impose

charges on the consumer arising from the default, those charges shall

not be greater than is necessary to compensate the creditor for costs it

has incurred as a result of the default.

(1)

Where the rights of the creditor under a credit

agreement are, or the credit agreement itself is, assigned to a third

party, the consumer shall be entitled to plead against that assignee, any

defence available to him against the original creditor. Such defence

may also include the right to set-off

Provided that set-off may only be raised in accordance

with the relevant provisions of articles 1196 to 1204 of the Civil Code,

which shall apply irrespective of anything to the contrary contained in

the credit agreement.

(2)

Where the rights of the creditor are assigned in

accordance with sub-regulation (1), the consumer shall be entitled to

be informed of such an assignment, except where the original creditor,

by agreement with the assignee, continues to service the credit towards

the consumer.

(1)

Where a consumer enters into an agreement to

open a current account and the consumer is allowed an overrun, the

agreement shall also include the information referred to in regulation

10(1)(e). The creditor shall in any case, provide that information on

paper or another durable medium on a regular basis.

(2)

In the event of a significant overrunning exceeding a

period of one (1) month, the creditor shall inform the consumer

without delay of the overrunning in writing or on a durable medium of

the amount involved, the borrowing rate and, of any penalties, charges

or interest on arrears which are applicable.

(1)

The annual percentage rate of charge, equating on

an annual basis, to the present value of all commitments, such as

drawdowns, repayments and charges, future or existing, agreed by the

creditor and consumer, shall be calculated in accordance with the

mathematical formula established in Part I of the Third Schedule.

(2)

For the purpose of calculating the annual percentage rate

of charge, the following costs shall be included in the total cost of

credit to the consumer

(a)

the costs of maintaining an account recording both

payment transactions and drawdowns;

(b)

the costs of using a means of payment for both

payment transactions and drawdowns; and

(c)

other costs relating to payment transactions

Provided that any charges payable by the consumer for

non-compliance with any of his commitments stipulated in the credit

agreement and charges other than the purchase price which, for

purchases of goods or services, he is obliged to pay, whether the

transaction is effected in cash or on credit, shall not be included in the

total cost of credit to the consumer for the purpose of calculating the

annual percentage rate of charge

Provided further that the costs referred to in sub-

regulation (2) shall not be included in the total cost of credit to the

consumer where the opening of the account is optional, and the costs

of the account have been clearly and separately shown in the consumer

credit agreement or in any other agreement concluded with the

consumer.

(3)

The calculation of the annual percentage rate of charge

shall be based on the assumption that

(a)

the credit agreement is to remain valid for the

period agreed and that the creditor and the consumer shall fulfil

their obligations under the terms and by the dates specified in

the credit agreement; and

(b)

the borrowing rate and other charges shall remain

fixed in relation to the initial level and shall remain applicable

until the end of the credit agreement in the circumstance that

the credit agreement contains a clause allowing variations in the

borrowing rate and, where applicable, charges contained in the

annual percentage rate of charge but unquantifiable at the time

of calculation.

(4)

Where necessary the additional assumptions established

in the Third Schedule may be used in calculating the annual

percentage rate of charge.

(1)

Without prejudice to any other power assigned to

the Authority in accordance with the Act, these regulations or any

other law, where a person falling within the scope of these regulations

fails to comply with any of the provisions of these regulations or any

Financial Institutions Rules issued thereunder which further

implement these regulations, the Authority may, by notice in writing

impose on such person an administrative penalty and other

administrative measures in accordance with article 23 of the Act, as

applicable.

(2)

A right of appeal to the Financial Services Tribunal shall

lie from the decisions which the Authority shall take in accordance

with these regulations and the provisions of article 21 of the Act shall

apply mutatis mutandis.

(1)

The provisions of these regulations shall prevail

and apply notwithstanding anything to the contrary contained in any

credit agreement entered into by the consumer.

(2)

Any waiver by the consumer of any of the rights granted

to him by these regulations shall be null and void.

(3)

The provisions of these regulations shall not be

circumvented as a result of the way in which agreements are

formulated, in particular by integrating drawdowns or credit

agreements falling within the scope of these regulations into credit

agreements the character or purpose of which would make it possible

to avoid its application.

(4)

Notwithstanding any provision in the credit agreement to

the effect that the applicable law to the credit agreement shall be the

law of a country which is not a Member State, the protection granted

by these regulations shall continue to apply where the credit agreement

has a close link with the territory of Malta or of any other Member

State.