Skip to content Skip to footer

Loading Results

Regulatory Updates

January 2019




Contact the PwC Malta Regulatory Team for further information in relation to any of the updates or if you wish to discuss how these may impact your business.


Welcome to PwC Malta’s Regulatory Updates - giving a recap for this month of the main legislative updates and key regulator activity.

View more

Anti-Money Laundering and Funding of Terrorism

Legal Updates


L.N. 12 of 2019 Prevention of Money Laundering Act (Cap. 373), National Coordinating Committee on Combating Money Laundering and Funding of Terrorism (Amendment) Regulations, 2019

The purpose of this Legal Notice is to amend regulation 5 of the said Regulations to impose an obligation on the National Coordinating Committee on Combating Money Laundering and Funding of Terrorism to keep national risk assessments up-to-date, which in turn, should be made available to the European Commission, the European Banking Authority (EBA), the European Insurance and Occupational Pensions Authority (EIOPA), the European Securities and Markets Authority (ESMA) and other Member States.

Click here to access the Legal Notice.

View more

Asset Management

MFSA Circulars


11/01/2019 Circular on Markets in Financial Instrument Directive (‘MiFID II’) and Markets in Financial Instruments Regulation (MiFIR)

This circular is addressed to investment firms, credit institutions providing investment services and/or performing investment activities, and market operators including any trading venues they operate.

This Circular is intended for the MFSA to inform the industry that ESMA has on 4 January 2019, updated the following:

  1. Questions and Answers (“Q&As”) on MiFID II/ MiFIR on transparency topics, in relation to the following topics - default transparency regime for equity instruments, publication of request for market data (RFMD) transactions; and default LIS and SSTI thresholds for bonds;
  2. Q&As relating to MiFID II and MiFIR Commodity Derivate Topics, in order to introduce a new Q&A dealing with electricity derivative contracts; and

Additionally, in December 2018, ESMA also published updated Guidelines on the application of C6 and C7 of Annex 1 under MiFID II (relating to commodity derivatives) and also made updates to the assessment of third-country trading venues for the purpose of post-trade transparency and position limits under MiFID II/MiFIR.

Click here to access the circular page.


14/01/2019 Circular – Brexit: UK FCA Temporary Permissions Regime

This purpose of this Circular is to inform the industry that the MFSA have been informed by the UK Financial Conduct Authority (“FCA”) that fund managers and investment firms (hereunder referred to as “Maltese Licensed Entities”) currently passporting into the UK need to apply to FCA under the Temporary Permissions Regime (“TPR”) in order to enable such entities to continue their regulated business within the scope of their current permissions in the UK. This regime would apply for a limited time period after the UK leaves the EU until Maltese Licensed Entities obtain full authorisation from the FCA.

It is pertinent to note that Maltese Licensed Entities currently passporting into the UK and intending to continue offering their services in the UK are urged to apply for the TPR via the FCA ‘Connect system’. Fund managers also need to notify the FCA of the passported funds they wish to continue to market in the UK.

The notification window will expire on 28 March 2019 and the notification procedure is free of charge.

Click here to access the circular page.


14/01/2019 Circular to Collective Investment Schemes, Alternative Investment Funds Managers, UCITS Management Companies and Depositaries of Collective Investment Schemes relating to Commission Delegated Regulations on safe-keeping duties of depositaries.

The purpose of this circular is to notify the industry of the publication of the Commission Delegated Regulation 2018/1618 amending Delegated Regulation 231/2013 (Level II law of AIFMD) and the Commission Delegated Regulation 2018/1619 amending Delegated Regulation (EU) 2016/438 (Level II law of UCITS V) (the “Regulations”) which were published on 30 October 2018.

The above-mentioned Regulations set out rules on the safe-keeping duties of depositaries and aim at ensuring stronger client protection. The changes introduced by the Regulations include:

Changes to asset segregation rules (including the prohibition for the depository’s own assets to be co-mingled with UCITS and/or AIF assets held in omnibus accounts);

Considerations to be taken into account when determining the frequency of reconciliations of accounts and records of the depositaries with those of third parties; and

A requirement to seek independent legal advice confirming that the applicable insolvency law in the host Member State where the third party is located, provides for a level of protection afforded by segregated financial instruments accounts in that jurisdiction.

The new requirements contained in both Regulations shall apply from 1 April 2020

Click here to access the circular page.


Legal Updates


LN 16 of 2019 Various Financial Services Laws (Amendment) Act, 2018 (ACT No. XXVI of 2018)

Further to Legal Notice XLIV of 2018 (discussed in Regulatory Updates issued for December 2018), the Minister responsible for the regulation of Financial Services has established that the various amendments made to the Investment Services Act shall come into force as from 1st February, 2019.

Click here to access the Legal Notice.


View more


MFSA Circulars



03/01/2019 Circular addressed to Credit Institutions providing an update on the Imposition of Negative Interest Rates on Euro Denominated Deposits

The purpose of this Circular is to bring to the attention of Credit Institutions, a further update to the Circular on the Imposition of Negative Interest Rates on Euro denominated Deposits issued by the MFSA in September 2018. The said circular dealt with the position taken by the MFSA (in consultation with Central Bank of Malta) with respect to the imposition of negative interest by Maltese credit institutions on Euro denominated deposits, whereby credit institutions are not to impose negative interest rates on Euro denominated deposits held with them by their clients, independently of the amount of such deposits held, the liquidity thereof or the type of client holding such balances.

Nonetheless, the MFSA (also in consultation with the Central Bank of Malta) has reconsidered the criteria established on the charge of maintenance fees on deposits held by credit institutions and decided to reduce the deposit threshold from EUR2.0 million to EUR1.5 million (or the equivalent amount in any other currency).

As established in the previous circular, the said maintenance fees may only be charged to:

  1. to non-personal customers;
  2. subject to other terms and conditions which may be decided by the credit institution, which shall be clearly disclosed to the client in good time prior to commencing the depositary services; and
  3. if it corresponds to another service being provided by the credit institution and may cover any ancillary operational costs which may be incurred in the course if providing such a service, is proportional thereto and is of a reasonable amount.

Click here to access the circular page.


11/01/2019 - Circular to Credit Institutions on Banking Rule BR/09

The MFSA would like to notify credit institutions that it has issued two annexes to Banking Rule BR/09 on Measures addressing credit risks arising from the assessment of the quality of asset portfolios of Credit Institutions authorised under the Banking Act, as follows:

  • Annex 1 – Connected Clients under Article 4(1)(39) of Regulation (EU) No 575/2013 (on prudential requirements for credit institutions and investment firms amending Regulation (EU) No. 648/2012), which specifies the approach required by credit institutions in applying the requirement to group two or more clients into a “group of connected clients” since they constitute a single risk as defined in Article 4(1)(39) of the Capital Requirements Regulation (“CRR”);
  • Annex 2 – Limits on exposures to shadow banking entities, which prescribes the approach and states the methodology which credit institutions shall adopt, as part of their internal processes and policies, for the purposes of handling risk arising from exposures to shadow banking. This relates to the limits on exposures to shadow banking entities and implements EBA Guideline EBA/GL/2015/20 setting limits on exposures to shadow banking entities that carry out banking activities outside a regulated framework under Article 395(2) of the CRR.

Additionally, the MFSA has also added two new paragraphs, 63A and 70A to BR/09 to allow for the inclusion of the above-mentioned annexes. The revised BR/09 shall come into force with immediate effect.

Click here to access the circular page.


View more

Family Business

Legal Updates


LN 17 of 2019 Family Business (Amendment) Act, 2018 (ACT No. XXXVII of 2018)

By virtue of this Legal Notice (discussed in the Regulatory Updates issued in November 2018), the Minister responsible for the Economy, Investment and Small Businesses has established the 31st January, 2019 as the date when all the provisions of this Act shall come into force.

Click here to access the Legal Notice.

View more

Financial Markets

MFSA Circulars



09/01/2019 Circular on the Consultation on Guidelines on Settlement Fails Reporting and Standardised Procedures and Messaging Protocols under ‘Regulation (EU) No. 909/2014 – the Central Securities Depositories Regulation (“CSDR”)

The Circular is intended for the MFSA to inform all interested stakeholders, particularly investment firms and professional clients, that ESMA has on 20 December 2018, published two consultation papers on Settlement Fails Reporting and Standardised Procedures and Messaging Protocols.

The said consultation papers are intended to serve as a first step for the development of guidelines in these areas, as follows:

Draft guidelines on standardised procedures and messaging protocols under Article 6(2) of the CSDR, which are intended to contribute to the early settlement of transactions on the intended settlement date and to the reduction of the number of instructions that fail to settle on the intended settlement date; and

Draft guidelines on Settlement Fails Reporting under Article 7(1) of the CSDR, dealing with reporting architecture and exchange of information between ESMA and National Competent Authorities (‘NCAs’) in relation to settlement fails, based on reports submitted by CSDs.

The aforementioned ESMA consultations are open for feedback until 20 February 2019.

Click here to access the circular page.

View more


Malta Gaming Authority (“MGA”) News Alerts



03/01/2019 The implementation of the First Phase of the Sandbox Framework for the acceptance of Virtual Financial Assets (“VFA”) and the use of Distributed Ledger Technology (“DLT”) within the Gaming Industry

The first of two phases of the MGA’s Sandbox Framework has been launched on 1 January 2019. During this phase, which is set to last ten (10) months, the MGA will be accepting applications for the use of DLT Assets by its licensees.

Click here to access the newsalert.


7/01/2019 MGA – FIAU Guidance Document on the Risk Evaluation Questionnaire

The MGA would like to notify licensees that the Financial Intelligence Analysis Unit has issued a guidance document for subject persons on the completion of the Anti- Money Laundering and Countering the Financing of Terrorism Risk Evaluation Questionnaire (“REQ”) which replaces the Annual Compliance Report.

Click here to access the newsalert.


29/01/2019 The MGA publishes the De Minimis and Gaming Premises Directives

The purpose of this news alert is to notify licensees and the general public of the issuance of the De Minimis Games Directive. This directive is a binding instrument establishing which games classify as a de minimis exempt games in terms of the Second Schedule to the Gaming Authorisations Regulations.

Moreover, the MGA has also issued the Gaming Premises Directive to outline further requirements to which gaming premises must adhere.

Both directives came into force on 1 February 2019 and can be accessed through the MGA website and the below link.

Click here to access the newsalert.

View more


MFSA Circulars



4/01/2019 - Feedback Statement issued further to Industry Responses to MFSA Consultation Document on Amendments to Pension Rules for Personal Retirement Schemes

In December 2017, the MFSA issued a Consultation on Amendments to the Pension Rules for Personal Retirement Schemes. Following strong feedback from the pensions market, the MFSA issued a second consolation document in November 2018 relating to various amendments to the Pension Rules for Personal Retirement Schemes issued under the Retirement Pensions Act (Cap.514) (the “RPA”). The main aim for these consultations was to clarify the applicability of the pension rules for personal retirement schemes.

This Feedback Statement issued by the MFSA outlines the industry’s main comments and the MFSA’s position, relating inter alia, to the following:

  • The introduction of a new ground of Member-Direction - “Professional Member”;
  • Investment Restrictions in case of member-directed schemes;
  • The role of the Retirement Scheme Administrator in the context of Member-Direction;
  • Compliance with the diversification requirement at member level;
  • Specific information to be provided to the Member;
  • The Retirement Scheme Administrator’s approval of the investment manager and investment advisor;
  • Due diligence on custodian at member level;
  • Amendments to Part B.5 on the Conditions relating to information for Scheme Members and Beneficiaries;
  • Amendments applicable to all Personal Retirement Schemes;
  • Schemes which qualify as Qualifying Recognized Overseas Pension Schemes (“QROPS”);
  • Back office administration;
  • Applicability of certain provisions;
  • Schemes set up as Trusts;
  • Schemes set up as Umbrella Funds; and
  • Amendments to Scheme Document.

Click here to access the Feedback Statement.


MFSA Circulars



15/01/2019 Circular to Licensed Personal and Occupational Retirement Schemes to submit the half-yearly and annual report as stipulated under Part B of the respective Pension Rules issued in terms of the Retirement Pensions Act, 2011

15/01/2019 Circular to Licensed Retirement Funds to submit the half-yearly and annual report as stipulated under Part B of the Pension Rules for Retirement Funds issued in terms of the Retirement Pensions Act, 2011

The above-mentioned MFSA circulars are addressed to (i) Licensed Personal and Occupational Retirement Schemes and (ii) Licensed Retirement Funds, intended to notify them that going forward, the half-yearly report and annual report should be submitted by their due date, through the MFSA web portal.

The above-mentioned procedure for the submission of the half-yearly report shall replace the current email by attachment and submission by post submissions. On the other hand, for the submission of the annual report, the MFSA still requires a signed hard-copy to be submitted.

The half-yearly report is to be submitted to the MFSA within 3 months from the end of the period concerned, whereas the annual report shall be submitted within six months of the date up to which it has been prepared..

Click here and here to access the circular pages.

View more


MFSA Circulars


14/01/2019 Circular: VFA Agents Approved Courses

The purpose of this circular is to for the MFSA to communicate that it has produced a list of courses approved for the purposes of fulfilling the competence requirements in Chapter 1 of the Virtual Financial Assets Rulebook and provide details about a course provided by the Malta Institute of Management for the purposes of the Competence Assessment of Prospective VFA Agents.

Click here to access the circular page.


15/01/2019 - Circular to Issuers of Virtual Financial Assets (“VFAs”)

Further to the ‘Circular to Issuers of VFAs’ issued by the MFSA in December 2018 providing certain guidelines for the registration of Whitepapers in terms of the Virtual Financial Assets Act (Chapter 590 of the laws of Malta) (the “VFA Act”), the MFSA is informing issuers of the following:

The launch of the Online Registration Form for Whitepapers under the VFA Act (including guidance with regards to the process and requirements of the submission of the said Whitepaper electronically);

The issue of the final version of the Financial Instrument Test (the MFSA shall be issuing an updated Guidance Note in this respect);

The introduction of new definitions within the Glossary of Terms of the VFA Framework, including “Admission to Trading on a DLT exchange”, “Auditor”, “Board of Administration”, “Connected Person”, “Cyber Security Framework”, “Experienced Investor”, “Functionary”, “Offer of virtual financial assets to the Public”, “Parent Undertaking”, “Public Sector Issuer”, “Regulated Information, “Related Parties”, “Restricted Person”, “Substantial Unitholder” and “Systems Auditor”;

The issue of a Note regarding Systems Auditors, whereby for the time being issuers are not required to appoint a systems auditor – but are only required to identify a person who meets the necessary criteria under the VFA Act as well as the Systems Auditor Guidelines issued by the Malta Digital Innovation Authority.

Click here to access the circular page.


MFSA Circulars


25/01/2019 Circular - A Status Update on the VFA Framework

This circular is intended to provide the industry with a status update in relation to the practical implementation of the VFA framework, including:

  • The Regulatory Framework, including the MFSA rulebook entitled the ‘Virtual Financial Assets Rulebook’, subdivided into – (i) Chapter 1: Virtual Financial Assets Rules for VFA Agents, (ii) Chapter 2 – Virtual Financial Assets Rules for Issuers of Virtual Financial Assets; and (iii) Virtual Financial Assets Rules for VFA Service Providers. In this respect, Chapter 1 and 2 have been successfully published on 17 and 30 October 2018 (respectively), and it is expected for Chapter 3 to be published in the coming weeks;
  • The Financial Instruments Test which was issued to assist users to determine whether a DLT qualifies as (i) Electronic Money as defined under the Third Schedule to the Financial Institutions Act (Chapter 376 Laws of Malta), (ii) a Financial Instrument as defined under the Second Schedule to the Investment Services Act (Chapter 370 Laws of Malta) (‘ISA’), whether issued in Malta or otherwise, (iii) a Virtual Financial Asset (‘VFA’) or a Virtual Token (‘VT’) as defined under the VFA Act
  • Frequently Asked Questions on the Virtual Financial Assets Framework, which should be updated by the MFSA from time to time to address the general queries raised by interested parties, as the framework develops
  • Applications for Authorisation under the Virtual Financial Assets Act and applications for registration of VFA Agents, and Whitepapers of VFAs issued by Issuers operating under the transitory provision;
  • VFA Agents approved courses and courses for Money Laundering Reporting Officers.

Click here to access the circular page.


MFSA Consultation Paper


31/01/2019 Consultation – MFSA FinTech Strategy – harnessing innovation through technology

This consultation document presents the MFSA’s vision and strategy towards developing Malta into a global FinTech hub, taking into consideration the European Commission’s FinTech Action Plan which seeks to harness the opportunities presented by technological innovation, and the Commission’s efforts to build a true Digital Single Market.

The consultation paper is essentially divided into the following chapters:

  • An outline the MFSA’s vision and mission towards establishing Malta as a global FinTech Hub;
  • Discussions and identification of the strategic priorities which the MFSA (together with other stakeholders) should aim at achieving in order to attain this goal; and
  • Seeking feedback from the industry through a set of questions as a conclusion to this Consultation Document.

The MFSA is seeking to provide legal and regulatory certainty to industry players in order to ensure effective investor protection, market integrity and financial soundness in the FinTech environment.

The MFSA aims at achieving this by developing a long-term strategy and is proposing a wider, cross-sectional approach underpinned by six strategic pillars, including: (i) Regulations (ii) Ecosystem, (iii) Architecture, (iv) International Links, (v) Knowledge, and (vi) Security. These six pillars are expected to provide the medium to build Malta into a thriving FinTech hub and enable firms to fully embrace technology, innovation and change in the way financial services are delivered.

Moreover, the key foundational element of this strategy will also be the introduction of the ‘FinTech Regulatory Sandbox’ and a FinTech Innovation Hub.

The consultation is open to the public until 1 March 2019 and responses may be submitted through an online survey.

Click here to access the Consultation Document.


View more






Follow us

Enquire about your personalised Regulatory Updates

Fill in the form below to receive more information about how we can customise our Regulatory Updates to meet the requirements of your business.

Required fields are marked with an asterisk(*)