MFSA Newsletter
Streamlining of insurance rules underway An industry-wide consultation process on a set of proposals for the review of Insurance Rules and Insurance Intermediaries Rules (formerly known as the Insurance Directives) in a number of specific areas is now...
Streamlining of insurance rules underway
An industry-wide consultation process on a set of proposals for the review of Insurance Rules and Insurance Intermediaries Rules (formerly known as the Insurance Directives) in a number of specific areas is now underway. The proposals have been published under two separate Notes for Consultation issued by the MFSA earlier this month. In the long term insurance business sector a new format for the submission of statements is being proposed, complete with instructions intended to assist insurers in the correct completion and submission of statements and in meeting the required standards of regulatory disclosure.
An abstract outlining the form and content of a valuation report prepared by an appointed actuary as required by the Insurance Business Act has also been published with the aim of obtaining feedback. These proposals are aimed at ensuring greater transparency, strengthening the governance of insurance companies, simplifying the certification of insurance returns and ensuring that actuarial expertise is available to advise life insurers on key business aspects.
The proposed Insurance Rule 5 of 2007, now also clarifies that only mutual associations situated in non-EEA states are regulated under this rule. At the same time the amended rule is proposing that a mutual association may be permitted to carry on business through a person enrolled in the Managers List in terms of the Insurance Intermediaries Act, and not exclusively through a person enrolled in the Brokers List.
Following the removal of the requirement for authorised insurance companies involved in the marketing and selling of linked long term contracts of insurance to hold a licence under the Investment Services Act, Insurance Rule 14 of 2007 related to advertising and other promotional activities is being amended to include specific requirements relating to LLTCs. The latter are now regulated solely by the provisions of the Insurance Business Act.
A new rule applying to insurance companies carrying on business through the internet is also being proposed. This rule is modelled on the provisions previously included in Insurance Intermediaries Rule 5 of 2006 relating to advertisements and other promotional activities which it would be superseding.
Specifically with regard to insurance intermediaries, a new Insurance Intermediaries Rule is being proposed, specifying the particulars, conditions and requirements for the enrolment of persons in the Tied Insurance intermediaries List by European insurance undertakings seeking to operate through such intermediaries in Malta.
All documents containing the proposed changes in legislation together with the applicable deadlines are available on the MFSA's website at www.mfsa.com.mt under the insurance section.
Seminar discusses EU Green Paper on financial services
According to a Eurobarometer Report published in 2005, Maltese consumers would be more inclined to accessing financial services offered by providers from other member states should these be more competitive and become more accessible.
Respondents in France, Ireland and Slovakia appear to be similarly disposed.
This factor was highlighted in a presentation entitled Consumers and Retailers: do their priorities meet? given by Geoffrey Bezzina, head of the MFSA's Consumer Complaints Unit, at a workshop organised by Forum Malta fl-Ewropa and the Institute of Financial Services-Malta.
The workshop discussed the EU's Green Paper on opening up of European retail financial services to more cross-border competition. Although most customers of retail financial services are likely to remain domestically focused, and that consumers must remain free to choose a local product or service if that is their preference, the Green Paper states that further reforms may be needed to make markets work better for consumers.
In the context of the Green Paper, Mr Bezzina's presentation also identified a number of possible legal, administrative and cultural or information barriers that could discourage cross-border procurement of financial services both in and out of Malta.
Preference for dealing with a local representative rather than an overseas provider, legal costs of pursuing a claim in another EU state, a relatively higher degree of consumer protection that may be available locally vis-à-vis certain other member states and language issues were among the factors which could be holding back consumers from procuring cross-border financial services.
On the other hand certain local providers could be deterred from marketing their services in other EU countries due to onerous general good provisions (suh as consumer protection measures) that may be applicable in some member states, or due to other difficulties which they may find too costly to overcome.
The Commission will be organising a hearing in Brussels in September to discuss the outcome of the consultation. The results of the consultative process will be incorporated into the Single Market Review, to be published in the Autumn.
An expert group, called the Government Expert Group on Retail Financial Services (GEGRFS), has meanwhile been set up by DG Internal Market & Services to assist the Commission in the development of its policy on retail financial services and the follow-up to the Green Paper. The MFSA is also represented on this Group.
Warnings to investors
Over the past month the MFSA has received and circulated a number of warnings to investors issued by overseas regulators. Full releases can be accessed from the Warnings for Investors section in the MFSA website: www.mfsa.com.mt
Licences issued this month
(i) Collective Investment Scheme
• Licence issued to NBCG Fund SICAV plc in respect of one sub-fund. This fund is a Professional Investor Fund targeting Qualifying Investors.
• Licence issued to Broadgate Capital Funds SICAV. This fund is a Professional Investor Fund targeting Qualifying Investors.
• Licence issued to Altma Fund SICAV plc in respect of three sub-funds. This fund is a Professional Investor Fund targeting Qualifying Investors.
• Licence issued to GlobalCapital Funds SICAV PLC. This Fund is a Professional Investor Fund targeting Qualifying Investors.
• Licence issued to RFID Invest II SICAV plc. This Fund is a Professional Investor Fund targeting Qualifying Investors.
• Licence issued to HSBC No Load Fund SICAV plc.
• Licence issued to Scottish Capital Protected Fund plc in respect of 46 sub-funds.
• Licence issued to Celsius Global Funds SICAV plc in respect of four sub-funds.
(ii) Investment Services Licences
• Category 1A Investment Services Licence issued to Cosmic Financial Services (Malta) Limited.
• Category 2 Investment Services Licence issued to All Invest Company Limited.
(iii) Insurance Licences
• Authorisation extended to GlobalCapital Life Insurance to carry on business of insurance in Class III.
• Authorisation granted to Setanta Insurance Company Ltd to carry on business of insurance in four classes of general business restricted to risks situated outside Malta.
(iv) Trusts and Trustees
• Finaserv Consultancy Limited has been authorised to act as Trustee in terms of the Trusts and Trustees Act.
• Claris Investments Limited has been authorised to act as Trustee in terms of the Trusts and Trustees Act.
• N Trust Limited has been authorised to act as Trustee in terms of the Trusts and Trustees Act.
(v) Revised licenses
• A revised collective investment scheme licence issued to Somerset Capital Fund SICAV in respect of four sub-funds.
• Amalgamated Investment SICAV plc and its respective sub-fund were converted from a Retail Non-UCITS Scheme to a Professional Investor Funds targeting Experienced Investors.
• Vilhena Funds SICAV and its seven sub-funds were converted from Retail Non-UCITS scheme to Maltese UCITS.
• MFSA website: http://www.mfsa.com.mt
• Registry website: http://registry.mfsa.com.mt
• Consumer website: http://www.mfsa.com.mt/consumer
An industry-wide consultation process on a set of proposals for the review of Insurance Rules and Insurance Intermediaries Rules (formerly known as the Insurance Directives) in a number of specific areas is now underway. The proposals have been published under two separate Notes for Consultation issued by the MFSA earlier this month. In the long term insurance business sector a new format for the submission of statements is being proposed, complete with instructions intended to assist insurers in the correct completion and submission of statements and in meeting the required standards of regulatory disclosure.An abstract outlining the form and content of a valuation report prepared by an appointed actuary as required by the Insurance Business Act has also been published with the aim of obtaining feedback. These proposals are aimed at ensuring greater transparency, strengthening the governance of insurance companies, simplifying the certification of insurance returns and ensuring that actuarial expertise is available to advise life insurers on key business aspects.
The proposed Insurance Rule 5 of 2007, now also clarifies that only mutual associations situated in non-EEA states are regulated under this rule. At the same time the amended rule is proposing that a mutual association may be permitted to carry on business through a person enrolled in the Managers List in terms of the Insurance Intermediaries Act, and not exclusively through a person enrolled in the Brokers List.
Following the removal of the requirement for authorised insurance companies involved in the marketing and selling of linked long term contracts of insurance to hold a licence under the Investment Services Act, Insurance Rule 14 of 2007 related to advertising and other promotional activities is being amended to include specific requirements relating to LLTCs. The latter are now regulated solely by the provisions of the Insurance Business Act.
A new rule applying to insurance companies carrying on business through the internet is also being proposed. This rule is modelled on the provisions previously included in Insurance Intermediaries Rule 5 of 2006 relating to advertisements and other promotional activities which it would be superseding.
Specifically with regard to insurance intermediaries, a new Insurance Intermediaries Rule is being proposed, specifying the particulars, conditions and requirements for the enrolment of persons in the Tied Insurance intermediaries List by European insurance undertakings seeking to operate through such intermediaries in Malta.
All documents containing the proposed changes in legislation together with the applicable deadlines are available on the MFSA's website at www.mfsa.com.mt under the insurance section.
Seminar discusses EU Green Paper on financial services
According to a Eurobarometer Report published in 2005, Maltese consumers would be more inclined to accessing financial services offered by providers from other member states should these be more competitive and become more accessible.
Respondents in France, Ireland and Slovakia appear to be similarly disposed.
This factor was highlighted in a presentation entitled Consumers and Retailers: do their priorities meet? given by Geoffrey Bezzina, head of the MFSA's Consumer Complaints Unit, at a workshop organised by Forum Malta fl-Ewropa and the Institute of Financial Services-Malta.
The workshop discussed the EU's Green Paper on opening up of European retail financial services to more cross-border competition. Although most customers of retail financial services are likely to remain domestically focused, and that consumers must remain free to choose a local product or service if that is their preference, the Green Paper states that further reforms may be needed to make markets work better for consumers.
In the context of the Green Paper, Mr Bezzina's presentation also identified a number of possible legal, administrative and cultural or information barriers that could discourage cross-border procurement of financial services both in and out of Malta.
Preference for dealing with a local representative rather than an overseas provider, legal costs of pursuing a claim in another EU state, a relatively higher degree of consumer protection that may be available locally vis-à-vis certain other member states and language issues were among the factors which could be holding back consumers from procuring cross-border financial services.
On the other hand certain local providers could be deterred from marketing their services in other EU countries due to onerous general good provisions (suh as consumer protection measures) that may be applicable in some member states, or due to other difficulties which they may find too costly to overcome.
The Commission will be organising a hearing in Brussels in September to discuss the outcome of the consultation. The results of the consultative process will be incorporated into the Single Market Review, to be published in the Autumn.
An expert group, called the Government Expert Group on Retail Financial Services (GEGRFS), has meanwhile been set up by DG Internal Market & Services to assist the Commission in the development of its policy on retail financial services and the follow-up to the Green Paper. The MFSA is also represented on this Group.
Warnings to investors
Over the past month the MFSA has received and circulated a number of warnings to investors issued by overseas regulators. Full releases can be accessed from the Warnings for Investors section in the MFSA website: www.mfsa.com.mt
Licences issued this month
(i) Collective Investment Scheme
• Licence issued to NBCG Fund SICAV plc in respect of one sub-fund. This fund is a Professional Investor Fund targeting Qualifying Investors.
• Licence issued to Broadgate Capital Funds SICAV. This fund is a Professional Investor Fund targeting Qualifying Investors.
• Licence issued to Altma Fund SICAV plc in respect of three sub-funds. This fund is a Professional Investor Fund targeting Qualifying Investors.
• Licence issued to GlobalCapital Funds SICAV PLC. This Fund is a Professional Investor Fund targeting Qualifying Investors.
• Licence issued to RFID Invest II SICAV plc. This Fund is a Professional Investor Fund targeting Qualifying Investors.
• Licence issued to HSBC No Load Fund SICAV plc.
• Licence issued to Scottish Capital Protected Fund plc in respect of 46 sub-funds.
• Licence issued to Celsius Global Funds SICAV plc in respect of four sub-funds.
(ii) Investment Services Licences
• Category 1A Investment Services Licence issued to Cosmic Financial Services (Malta) Limited.
• Category 2 Investment Services Licence issued to All Invest Company Limited.
(iii) Insurance Licences
• Authorisation extended to GlobalCapital Life Insurance to carry on business of insurance in Class III.
• Authorisation granted to Setanta Insurance Company Ltd to carry on business of insurance in four classes of general business restricted to risks situated outside Malta.
(iv) Trusts and Trustees
• Finaserv Consultancy Limited has been authorised to act as Trustee in terms of the Trusts and Trustees Act.
• Claris Investments Limited has been authorised to act as Trustee in terms of the Trusts and Trustees Act.
• N Trust Limited has been authorised to act as Trustee in terms of the Trusts and Trustees Act.
(v) Revised licenses
• A revised collective investment scheme licence issued to Somerset Capital Fund SICAV in respect of four sub-funds.
• Amalgamated Investment SICAV plc and its respective sub-fund were converted from a Retail Non-UCITS Scheme to a Professional Investor Funds targeting Experienced Investors.
• Vilhena Funds SICAV and its seven sub-funds were converted from Retail Non-UCITS scheme to Maltese UCITS.
• MFSA website: http://www.mfsa.com.mt
• Registry website: http://registry.mfsa.com.mt
• Consumer website: http://www.mfsa.com.mt/consumer