The Malta Financial Services Authority is currently reviewing the feedback received to its proposals to improve customer protection in the investment services sector, according to chairman Joe Bannister.
The MFSA decided to review the conduct of business regulatory regime for the investment services sector. The consultation paper addressed various issues, such as defining types of customers, measuring risk, the dissemination of information on risk, ‘know your customer’ tests, standards of care, records and disclosures, professional standards, designations, transparency and qualifications for advisory functions, measures on inducements and disclosure of remuneration.
The recommendations aim to ensure that Maltese consumers and investors have acceptable levels of protection and that the rules are applied by firms in Malta in ways that enhance consumer confidence and build on the country’s established reputation for business probity and high standards.
Bannister was speaking during the presentation of the MFSA’s annual report to Parliament, which also includes a proposal for an ombudsman to be appointed for the financial services industry.
The report also gives an overview of the industry. The fund services infrastructure continued to build up in 2013 with the issuance of more investment services licences.
There were 125 investment service licences at the end of 2013, a net increase of almost 11 per cent from the previous year.
The authority licensed 135 new collective investment schemes (including sub-funds), a slight increase over the previous year.
While the number of new licensed professional investor funds remained almost at the same level of the previous year, the number of new Undertakings for the Collective Investment of Transferable Securities funds doubled during the same period.
Additionally, there were 188 non-Malta domiciled funds (including sub-funds) administered by Malta-based fund administration companies at the end of 2013. This represents an increase of 31 per cent .
Among the emergent niches of growth, retirement pension schemes registered an increase of 88 per cent when compared to the previous year. Additionally, there were two retirement funds registered .
Malta was the EU country most advanced in adopting new EU legislation in national law . It was the first jurisdiction to complete the transposition of the Alternative Investment Fund Management Directive.