Under a recently issued circular, the MFSA, Malta’s number one financial regulator, intends to expedite the process of obtaining a financial services license in the Republic of Malta by:
- introducing a termination date;
- introducing a deadline for a response.
VFA service providers must either complete their applications by the specified deadline (September 2020) or have their applications put on hold. This, in turn, will require them to cease all operations conducted inside or outside Malta. According to the regulator, getting a financial services license in Malta will require them to submit two sets of documents (Type A & Type B). Of them, Type A documentation will be deemed enough to obtain a financial services provider license in the Republic of Malta.
The regulator also sets a 3-week deadline within which applicants must respond to its comments. Failure to meet the said deadline will result in their applications being rejected.
Instead of using services of intermediaries (e.g. investment managers or advisors), professional agents are now required to channel investments into their accounts. Becoming a professional agent requires submitting a retirement plan indicating that an applicant is aware of their responsibilities in relation to individual accounts.
Applicants must have the necessary experience & knowledge related to specific types of financial instruments they invest in.
They must have worked in the financial services sector for at least 36 months in a professional, and not an administrative position.
A potential member's account within the framework of the pension scheme must be no less than five hundred thousand euros. Those seeking to obtain a fintech license in Malta are highly recommended to pay close attention to the new definition.
Compliance with AML/CFT Rules
For the purpose of complying with AML/CFT rules, the ESMA & EBA have launched consultations regarding the adoption of new guidelines. Meant to supersede the 2017 rules, they're expected to focus on:
- independence of individuals holding positions in affiliated companies;
- gender balanced staffing in leadership positions;
- guidance on the BRRD.
Consultations are estimated to go on until late October 2020. Individuals considering opening a business in Malta shold, therefore, be on the lookout for the latest developments in the new guidelines.
Impact of the COVID-19 Pandemic: Opening a Business in the EU
In an attempt to provide further clarification of its new disclosure & reporting system, the EBA has launched a FAQ section on its website. It specifically addresses reporting & disclosure issues that have emerged due to the coronavirus pandemic. The section is also intended to assist senior managers of lending institutions in their implementation of the new guidelines developed by the ESMA & EBA.
Considering getting a financial services license in Malta? Need advice on the regulation of financial services in Malta? Why not contact IQ Decision UK?