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The Insurance Intermediaries Act (Act No. Xii Of 2006)

INSURANCE INTERMEDIARIES ACT, 2006
Arrangement of Act PART I PRELIMINARY
1. Short title
2. Interpretation and scope
PART II REGULATORY POWERS
3. Powers of the Minister
4. Powers and duties of the competent authority
PART III
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REGISTRATION OR ENROLMENT OF INSURANCE AGENTS, INSURANCE MANAGERS AND INSURANCE BROKERS
5. Application of this Part to specified insurance intermediaries
6. Registration or enrolment of insurance intermediaries
7. Register of insurance intermediaries
8. Qualifications for registration
9. List of persons carrying on insurance intermediaries activities
10. General requirements for enrolment
11. Specific qualifications for enrolment in the case of local companies
12. Specific requirements for enrolment in the case of foreign companies
13. Grant of registration or enrolment by competent authority to insurance
intermediaries
14. Certificate of registration or enrolment of intermediaries
PART IV
POWERS OF INTERVENTION IN RELATION TO PERSONS ENROLLED UNDER PART III OF THIS ACT
15. Automatic striking off of registration or enrolment of intermediaries
16. Power of the competent authority to suspend or strike the name off the register or list
17. Notification of intention of suspension or striking a name off the register or
list
18. Restoration of a name struck off the register or list
19. Power of the competent authority to protect the public interest
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PART V
OBLIGATIONS OF PERSONS ENROLLED UNDER PART III OF THIS ACT
20. Monies held in a fiduciary capacity
21. Fidelity bonds required of insurance intermediaries
22. Exemptions applicable to insurance managers
23. Notification of persons registered in the register
24. Submission of audited financial statements and income statements
25. Submission of business of insurance intermediaries statements
26. Enrolled persons ceasing to carry on insurance intermediaries activities
PART VI
FINANCIAL YEAR AND AUDITORS
27. Financial year of insurance intermediaries
28. Appointment, duties and termination of appointment of auditors
29. Communication by auditors etc. with the competent authority
PART VII
PROVISIONS APPLICABLE TO INTERMEDIARIES CARRYING ON BUSINESS AS INSURANCE BROKERS
30. Appointment of insurance managers by enrolled insurance brokers
31. Contracts of insurance relating to risks situated in Malta or to commitments where Malta is the country of the commitment
32. Underwriting agreements
PART VIII
REGISTRATION AND ENROLMENT OF TIED INSURANCE INTERMEDIARIES
33. Restriction on persons for carrying out tied insurance intermediaries activities
34. Tied Insurance Intermediaries Company Registers
35. Qualifications for registration
36. List of persons carrying out tied insurance intermediaries activities
37. Appointment, registration and enrolment of tied insurance intermediaries
38. Maintenance of separate accounts
39. Striking name off Tied Insurance Intermediaries Company Register
40. Striking name off Tied Insurance Intermediaries Company Register or the
Tied Insurance Intermediaries List
41. Protection of the public or other interest
42. Restoration of a name struck off the Tied Insurance Intermediaries List
43. Application of Part VIII of the Act and European insurance undertakings
PART IX GENERAL PROVISIONS
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44. Changes in documentation
45. Co-operation in supervisory duties and sharing of information
46. Confidentiality
47. Access to the public of the registers and the lists
48. Use of the word “insurance”
49. Services of notices, etc.
50. Appeals
51. Exclusion of liability
52. Offences
53. Penalties
54. Application of certain articles of the Insurance Business Act to insurance intermediaries
55. Repeals and Savings
PART X
Amendment of the Malta Financial Services Authority Act, Cap. 330 ……56-57
PART XI
Amendment of the Trusts and Trustess Act, Cap. 331.....…………………58-60
PART XII
Amendment of the Investment Services Act, Cap. 370 …………………...61-65
PART XIII
Amendment of the Financial Institutions Act, Cap. 376 …………………66-70
PART XIV
Amendment of the Companies Act, Cap. 386 ……………………………71-74
PART XV
Amendment of the Insurance Business Act, Cap. 403 ……………………75-121
PART XVI
Amendment of the Special Funds (Regulation) Act, Cap. 450 …………122-130
SCHEDULE
Insurance Intermediaries and Insurance Intermediaries Activities
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I assent.
(L.S.) EDWARD FENECH ADAMI
President
28th July, 2006
ACT No. XII of 2006

AN ACT to regulate the registration and enrolment of insurance intermediaries and insurance intermediaries activities.

BE IT ENACTED by the President, by and with the advice and consent of the House of Representatives, in this present Parliament assembled, and by the authority of the same, as follows>
PART I PRELIMINARY

Short title.

Interpretation and scope.

1. (1) The short title of this Act is the Insurance Intermediaries
Act, 2006.
(2) Parts I and IX and the Schedule after Part IX to this Act shall come into force on such date as the Minister responsible for finance may be notice in the Gazette establish.
2. (1) In this Act, unless the context otherwise requires -
“advertisement”, in relation to insurance intermediaries activities, means any form of advertising, whether done verbally or in writing and, without prejudice to the generality of the foregoing, includes advertising in a publication, the display of notices, signs, labels or showcards, by means of letters, circulars, prospectuses, catalogues, price lists or other documents, by an exhibition of pictures or photographic or cinematographic films, by way of sound broadcasting or television, by the distribution of
recordings or in any other manner, and references to the issue of an advertisement shall be construed accordingly<
“Agents List” means the list of persons acting as insurance agents established and maintained under article 9 of this Act<
“Agents Register” means the insurance agents register established and maintained under article 7 of this Act<
“approved auditor” and “auditor” have the meaning assigned to them by subarticle (10) of article 28 of this Act<
“authorised company” means a company authorised or any person deemed authorised, under the Insurance Business Act, to carry on business of insurance and includes a company enrolled under this Act to act as an insurance agent of the company, as well as a European insurance undertaking having its head office in a Member State or an EEA State establishing a branch or providing services in Malta in exercise of a European right<
“binding authority agreement” means an agreement between a member of Lloyd’s or a person acting on its behalf and a coverholder under which the coverholder may, in accordance with the terms thereof, accept risks or commitments on behalf of that member of Lloyd’s<
“body corporate” means an entity having a legal personality distinct from that of its members<
“branch” means premises of the company, other than its head office, from which insurance intermediaries activities are carried out<
“Brokers List” means the list of persons carrying on business as insurance brokers established and maintained under article 9 of this Act<
“Brokers Register” means the insurance brokers register established and maintained under article 7 of this Act<
“business of insurance” has the same meaning as is assigned to it by subarticle (1) of article 2 of the Insurance Business Act<
“business of insurance broking”, in relation to a registered insurance broker or an enrolled insurance broker, means the activities listed in paragraph 1 of the Third Column of the Schedule<
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Cap. 403.

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Cap. 386.

“cell” has the same meaning as is assigned to it by the
Companies Act<
“cell company” has the same meaning as is assigned to it by the Companies Act<
“certificate of enrolment” -
(a) in relation to a person acting as an insurance agent, means a certificate issued by the competent authority under article 14 of this Act to the person evidencing enrolment of that person in the Agents List< and
(b) in relation to a person acting as an insurance manager, means a certificate issued by the competent authority under article 14 of this Act to the person evidencing enrolment of that person in the Managers List<
(c) in relation to a person carrying on business as insurance broker, means a certificate issued by the competent authority under article 14 of this Act to the person evidencing enrolment of that person in the Brokers List< and
(d) in relation to a person registered as a tied insurance intermediary in the Tied Insurance Intermediaries Company Register of any company, means a certificate issued by the competent authority under article 37 of this Act to the company enrolling that person evidencing enrolment of that person in the Tied Insurance Intermediaries List<
“certificate of registration”-
(a) in relation to an individual registered as an insurance agent, means a certificate issued by the competent authority under article 14 of this Act to that individual evidencing registration of that individual in the Agents Register<
(b) in relation to an individual registered as an insurance manager, means a certificate issued by the competent authority under article 14 of this Act to that individual evidencing registration of that individual in the Managers Register< and
(c) in relation to an individual registered as an insurance broker, means a certificate issued by the competent
authority under article 14 of this Act to that individual evidencing registration of that individual in the Brokers Register<
“class” -
(a) in relation to long term business, means any of the classes specified in the Second Schedule to the Insurance Business Act< and
(b) in relation to general business, means any of the classes specified in Part I of the Third Schedule to the Insurance Business Act<
“commitment” and “country of the commitment” have the same meanings as are assigned to them by subarticle (1) of article
2 of the Insurance Business Act<
“company” includes a local company and a foreign company< “competent authority” means the body appointed under article
3 of the Insurance Business Act<
“conditions” includes obligations and restrictions<
“contract of insurance” and “contract” have the same meanings as are assigned to them by subarticle (1) of article 2 of the Insurance Business Act<
“control”, in relation to a body corporate, is the power to determine the financial and operating policies of the body corporate<
“controller”, in relation to a body corporate, is a person who, alone or together with others, exercises control of the body corporate<
“coverholder” means a person authorised under a binding authority agreement to accept or to issue documents related to contracts of insurance evidencing the acceptance of risks or commitments on behalf of a member of Lloyd’s granting such authority pursuant to such agreement<
“director”, in relation to a company, includes an individual occupying the position of a director of the company, by whatever name he may be called, empowered to carry out substantially the same functions in relation to the direction of the company as those
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carried out by a director and, in respect of a foreign company, includes a member of a local board, an agent and the person designated as the representative of that company for the purpose of sub-paragraph (ii) of paragraph (b) of subarticle (1) of article
12 of this Act<
“EEA State” means a State which is a contracting party to the agreement on the European Economic Area signed at Oporto on 2
May, 1992 as amended by the Protocol signed at Brussels on the
17th March, 1993 and as amended from time to time< “enrolled” -
(a) in relation to a person acting as an insurance agent, means enrolled in the Agents List under article 13 of this Act<
(b) in relation to a person acting as an insurance manager, means enrolled in the Managers List under article
13 of this Act<
(c) in relation to a person carrying on business as insurance broker, means enrolled in the Brokers List under article 13 of this Act< and
(d) in relation to a person registered as a tied insurance intermediary, means enrolled in the Tied Insurance Intermediaries List under article 37 of this Act,
and, in each case, “enrolment” shall be construed accordingly< “European insurance undertaking” means an undertaking
having its head office in a Member State or an EEA State, other
than Malta, pursuing the activity of direct insurance within the meaning of article 1 of First Council Directive 73#239#EEC of 24
July 1973 on the coordination of laws, Regulations and administrative provisions relating to the taking-up and pursuit of direct insurance other than life assurance or article 2 of Directive
2002#83#EC of the European Parliament and of the Council of 5
November 2002 concerning life assurance, which has received authorisation under article 6 and article 4 of the said Directives respectively<
“financial year” shall be construed in accordance with subarticle (4) of article 27 of this Act<
“foreign company” means a company or a partnership en commandite or similar or equivalent body corporate, the capital of which is divided into shares, registered, incorporated or constituted outside Malta under the laws of any country provided that such company or partnership en commandite has complied with the provisions of any law which may from time to time be in force in Malta relating thereto>
Provided that, unless otherwise specified, the term “foreign company” shall not include a European insurance intermediary registered under article 3 of Directive 2002#92#EC of the European Parliament and of the Council of 9 December 2002 on insurance mediation<
“functions” includes responsibilities, powers and duties< “group” and “group of classes”, in relation to general business,
means any group of classes or part classes specified in Part II of
the Third Schedule to the Insurance Business Act<
“insurance agent” means a person carrying out activities listed in paragraph (2) of the Third Column of the Schedule< and in relation to Lloyd’s, means a person enrolled as such under article
13 of this Act appointed by or on behalf of a member of Lloyd’s to be its coverholder in Malta in respect of business of insurance with authority to enter into contracts of insurance on behalf of that member under the terms of a binding authority agreement<
“insurance broker” means a person carrying on business of insurance broking<
“insurance manager” means a person carrying out activities listed in paragraph (3) of the Third Column of the Schedule<
“insurance intermediary” means any natural or legal person who, takes up or pursues insurance intermediaries activities, and includes a person providing services ancillary to other business of insurance as may be prescribed<
“insurance intermediaries activities” means the activities of introducing, proposing or carrying out other work preparatory to the conclusion of contracts of insurance, or of concluding such contracts, or of assisting in the administration and performance of such contracts, in particular in the event of a claim and includes the activities listed in paragraphs 1 to 4 of the Third Column of the Schedule and any other activities as may be prescribed<
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Cap. 373.

“insurance intermediaries rule” means a rule in respect of insurance intermediaries activities which shall be binding on insurance intermediaries and others as may be specified therein, issued by the competent authority in virtue of subarticle (2) of article 4 of this Act<
“insurer” has the same meaning as assigned to it by subarticle
(1) of article 2 of the Insurance Business Act<
“local company” means a limited liability company formed and registered under the Companies Act and includes, subject to subarticle (2) of this article, a partnership en commandite, the capital of which is divided into shares, formed and registered under the said Act<
“Malta’s international commitments” has the same meaning as assigned to it by subarticle (1) of article 2 of the Insurance Business Act<
“Managers List” means the list of persons acting as insurance managers established and maintained under article 9 of this Act<
“Managers Register” means the insurance managers register established and maintained under article 7 of this Act<
“Member State” means a Member State of the European
Communities<
“Minister” means the Minister responsible for finance< “money laundering” has the same meaning as is assigned to
it by the Prevention of Money Laundering Act<
“officer”, in relation to a company, includes a director, partner, manager or company secretary or any person effectively acting in such capacity whether formally appointed or not<
“own funds” shall be construed in accordance with an insurance intermediaries rule made for the purpose of this Act to determine the amounts and components which make up the enrolled person’s own funds<
“prescribed” means prescribed by regulations under this Act< “qualifying shareholding” means a direct or indirect holding
in a company which represents ten per centum or more of the share
capital issued by such company or of the voting rights attaching to such share capital or which makes it possible to exercise a significant influence over the management of the company, and “qualifying shareholder” shall be construed accordingly<
“registered” -
(a) in relation to a person registered as an insurance agent under article 13 of this Act, means registered in the Agents Register<
(b) in relation to a person registered as an insurance manager under article 13 of this Act, means registered in the Managers Register<
(c) in relation to a person registered as an insurance broker under article 13 of this Act, means registered in the Brokers Register< and
(d) in relation to a person registered as a tied insurance intermediary under article 37 of this Act, means registered in the Tied Insurance Intermediaries Company Register of any one or more companies,
and, in each case, “registration” shall be construed accordingly< “representative” shall be construed in accordance with article
12 of the Insurance Business Act<
“risk situated in Malta” has the same meaning as is assigned to it by subarticle (1) of article 2 of the Insurance Business Act<
“Schedule” means the Schedule to this Act<
“tied insurance intermediary” means a person carrying on tied insurance intermediaries activities<
“tied insurance intermediaries activities”, in relation to a person registered as a tied insurance intermediary, means activities listed in paragraph 4 of the Third Column of the Schedule and any person who carries on insurance intermediaries activities, in addition to his principal professional activity, shall also be considered as a tied insurance intermediary acting under the responsibility of an authorised company for the products offered on its behalf if the insurance is complementary to the goods supplied or services provided in relation to his principal professional activity,
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Cap. 330. Scope.

Powers of the

Minister.

Cap. 403.

whether or not the person collects premiums or amounts intended for the policyholder concerned<
“Tied Insurance Intermediaries List” means the list of tied insurance intermediaries established and maintained under subarticle (1) of article 36 of this Act<
“Tied Insurance Intermediaries Company Register” in relation to an authorised company means the Tied Insurance Intermediaries Company Register established and maintained by a company under subarticle (1) of article 34 of this Act<
“Tribunal” means the Financial Services Tribunal referred to in article 21 of the Malta Financial Services Authority Act.
(2) The objective of this Act is, in part, to implement the provisions of Directive 2002#92#EC of the European Parliament and of the Council of 9 December 2002 on insurance mediation, and any other Directive of the European Parliament and of the Council that may be issed from time to time on the regulation of insurance intermediaries which shall be interpreted and applied accordingly.
(3) The provisions of this Act shall apply to a partnership en commandite or to a similar or equivalent body corporate subject to such modifications as the competent authority may, from time to time, make in any provision thereof, which modifications shall not materially detract from the main object of the provisions so modified.
(4) In this Act and in any regulations made thereunder, if there is any conflict between the English and the Maltese texts, the English text shall prevail.
PART II REGULATORY POWERS
3. (1) The competent authority appointed under article 3 of the Insurance Business Act shall carry out the functions of the competent authority under this Act and, in particular, shall ensure compliance with the provisions of this Act.
(2) The Minister may, after consultation with the competent authority, make regulations as may be required for carrying into effect any of the provisions of this Act and without prejudice to the generality of the foregoing, the Minister may, by such regulations, in particular, make provisions in respect of any one or more of the following matters -
(a) the implementation of Directive 2002#92#EC of the European Parliament and of the Council of 9 December 2002 on insurance mediation<
(b) the transposition of any requirement or provision as may arise under a Directive, Regulation or Decision of the European Union or any other similar measure relevant for the purposes of this Act<
(c) the amendment or revocation of the Schedule<
(d) the payment by any person, body or cell created by a cell company, as the case may be, of any fees, duties and such other charges payable to the competent authority in respect of any matter provided for, by or under the Act, or any regulations made under this article<
(e) the registration or enrolment of persons, other than persons registered or enrolled by virtue of this Act, carrying out insurance intermediaries activities or providing services ancillary to business of insurance as may be prescribed<
(f) any matter relating to or connected with any provision contained in the Schedule<
(g) any matter that may or is to be prescribed under any provision of this Act<
(h) the administrative penalties in respect of infringements as may be prescribed which may be imposed and recovered by the competent authority without recourse to a court hearing< administrative penalties shall be due to the competent authority as a civil debt>
Provided that, an administrative penalty may not be greater than a financial penalty of forty thousand Maltese liri in respect of any infringement and, where an infringement continues, a further penalty not exceeding fifty Maltese liri for each day during which the infringement continues<
(i) the penalties or other punishments to which persons contravening or failing to comply with any provision of any regulation made under this Act shall become liable, being penalties of not less than one hundred Maltese liri and not exceeding forty thousand Maltese liri, in respect of any offence and in respect of a
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Powers and duties of the competent authority.

continuing offence of a further penalty not exceeding one hundred
Maltese liri for each day during which the offence continues<
(j) any matter incidental to or connected with any of the above<
(k) any matter relating to the establishment, co-ordination, amalgamation and otherwise of compensation schemes.
(3) The Minister may, after consulting the competent authority, make regulations exempting any person from all or any of the provisions of this Act or any regulations made thereunder, subject to such conditions or requirements including the requirement of other forms of registration or enrolment and notification procedures as may be prescribed.
(4) The Minister may also by regulations under this article, after consultation with the competent authority, extend and make applicable any of the provisions of this Act to any insurance intermediary activity as may be prescribed which in his opinion ought, in the public interest, to be regulated by such provisions.
(5) Regulations made under this article may make such exemptions, conditions or modifications as may be specified therein in respect of different cases, circumstances or purposes and may give the competent authority such power of adaptation of the regulations as may be specified therein.
(6) In the event of a doubt as to whether an activity constitutes the carrying out of insurance intermediaries activities, or whether such insurance intermediaries activities are or are not being carried on in Malta, the matter shall be conclusively determined by the competent authority.
(7) The exercise of any of the powers assigned under this article shall be subject to any obligations or restrictions arising from Malta’s international commitments.
(8) Regulations made under this Act and any amendment or revocation of such regulations, may be published in the English language only.
4. (1) It shall be the duty of the competent authority to carry out the functions assigned to it by or under this Act and to ensure that persons, companies or insurance intermediaries, registered or enrolled in accordance with this Act and regulations made thereunder comply
with the provisions of this Act, any regulations made thereunder, with insurance intermediaries rules made by the competent authority in virtue of this Act and of any regulations made thereunder and with the conditions specified in certificates of registration or enrolment.
(2) The competent authority may make insurance intermediaries rules as may be required for carrying into effect any of the provisions of this Act and of any regulations made thereunder. The competent authority may amend or revoke such insurance intermediaries rules.
(3) Insurance intermediaries rules and any amendment or revocation thereof shall be officially communicated to the persons or companies concerned and be open to public inspection at the offices of the competent authority at all times during the normal working hours of the competent authority.
(4) Insurance intermediaries rules made by the competent authority in virtue of this Act may provide for different regulatory requirements to be applicable to different categories of insurance intermediaries< and without prejudice to insurance intermediaries rules required to be made under this Act and to the generality of the foregoing, the competent authority may, by such insurance intermediaries rules, in particular -
(a) determine, in relation to insurance intermediaries, what constitutes fitness and properness<
(b) determine, in relation to insurance intermediaries, the criteria of sound and prudent management<
(c) determine the information which insurance intermediaries shall disclose to persons seeking or making use of insurance intermediary services<
(d) determine the codes of conduct which may regulate any aspect of dealings between insurance intermediaries and insurance companies or between such intermediaries and persons seeking or making use of insurance intermediary services<
(e) determine, in relation to insurance intermediaries activities, the issuing of advertisements and the undertaking of any other promotional activities.
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Application of this Part to specified insurance intermediaries.

Registration or enrolment of insurance intermediaries.

Register of insurance intermediaries.

Qualifications for registration.

PART III
REGISTRATION OR ENROLMENT OF INSURANCE AGENTS, INSURANCE MANAGERS AND INSURANCE BROKERS
5. This Part of the Act applies to persons acting as insurance agents, insurance managers and persons carrying on business as insurance brokers, hereinafter referred to as “the intermediary”.
6. (1) Subject to subarticle (3) of this article, no person shall act as an intermediary and carry on, or attempt to carry on, in or from Malta, insurance intermediaries activities unless such person is registered or enrolled under article 13 of this Act.
(2) The competent authority shall not grant registration or enrolment under this article to a person nor shall the competent authority permit such person to be registered or enrolled thereunder or to remain so registered or enrolled, unless it is satisfied that such person fulfils or complies with the requirements set out in this Part of the Act.
(3) This article shall not apply to a person, which is registered pursuant to Directive 2002#92#EC of the European Parliament and of the Council of 9 December 2002 on insurance mediation in a Member State or EEA State, other than Malta.
7. The competent authority shall establish and maintain registers of persons carrying on the insurance intermediaries activities of insurance agents, insurance managers and insurance brokers, in this Act separately referred to as the “Agents Register”, the “Managers Register” or the “Brokers Register”, containing such particulars as the competent authority may determine from time to time, by an insurance intermediaries rule made for the purposes of this article, of all persons which are entitled under this Act to be registered therein and to apply in the manner determined by that rule to be so registered.
8. (1) A person shall be entitled to be registered in the “Agents Register”, the “Managers Register” or the “Brokers Register” if he satisfies the competent authority that -
(a) he is an individual<
(b) he is a fit and proper person to be so registered and to ensure the company’s sound and prudent management<
(c) he possesses the qualifications and fulfils or complies with the requirements determined by an insurance intermediaries rule made for the purposes of this article.
(2) A person shall not be entitled to carry out insurance intermediaries activities by virtue of his registration under this article unless he is a director or an employee of a company enrolled under article 13 of this Act.
9. The competent authority shall establish and maintain a list of persons carrying on insurance intermediaries activities of insurance agents, insurance managers and insurance brokers, in this Act separately referred to as the “Agents List”, the “Managers List”, or the “Brokers List”, containing particulars of all persons which are entitled under this Act to be enrolled therein and which apply in the manner determined from time to time by the competent authority in an insurance intermediaries rule made for the purposes of this article.
10. (1) Subject to paragraph (b) of this subarticle, the intermediary shall be entitled to be enrolled in the Agents List, Managers List or the Brokers List if, it satisfies the competent authority that>
(a) in the case of an applicant which is a company>
(i) the applicant’s objects are limited to operations arising directly from insurance intermediaries activities listed in paragraphs (1), (2) and (3) of the Third Column of the Schedule, as applicable, and to matters or functions connected therewith or ancillary thereto, to the exclusion of all other commercial business, other than business determined by an insurance intermediaries rule made for the purposes of this article<
(ii) the applicant discloses to the satisfaction of the competent authority such information as the competent authority has requested of it in relation to persons who will, upon its enrolment, have any proprietary, financial or other interest in, or in connection with, the applicant<
(iii) all qualifying shareholders, controllers and all persons who will effectively manage the affairs or carry out the operations appropriate to the application are fit and proper persons to ensure its sound and prudent management<
(iv) the applicant’s own funds, whether in Maltese liri or in other currencies acceptable to the competent authority
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List of persons carrying on insurance intermediaries activities.

General requirements for enrolment.

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are at all times not less than such amount appropriate for the kind of business to be carried on by it as may be determined by an insurance intermediaries rule made for the purposes under this Act and such own funds shall at all times be unencumbered<
(v) the applicant has at all times in its favour a policy of professional indemnity insurance or some other comparable guarantee, in each case acceptable to the competent authority, indemnifying it or any person employed by it or otherwise acting for it, to such amount, in such manner and in respect of such matters as the competent authority may from time to time determine<
(vi) the applicant submits to the satisfaction of the competent authority a scheme of operations appropriate to the application which shall include the particulars or proof as may be determined by an insurance intermediaries rule<
(b) in the case of an applicant who is an individual>
(i) indents (i) and (iii) of paragraph (a) of subarticle
(1) of this article shall not apply< and
(ii) he shall be entitled to be enrolled in the Agents List, Managers List or the Brokers List if he satisfies the competent authority that –
(aa) he is a fit and proper person to be so enrolled and to ensure that the business is carried on in a sound and prudent manner<
(bb) he possesses the qualifications and fulfils or complies with the requirements determined by the Act or an insurance intermediaries rule made for the purposes of this article<
(cc) his activities are limited to operations arising directly from insurance intermediaries activities and matters and functions connected therewith or ancillary thereto, to the exclusion of all other commercial business other than business determined by an insurance intermediaries rule.
(2) Where close links exist between the intermediary and any other person, the competent authority shall>
(a) only grant enrolment if it considers that such close links do not prevent it from effectively exercising its supervisory functions< and
(b) refuse to grant enrolment if it considers that the laws, regulations or administrative provisions of any country, other than Malta, governing any person with whom the intermediary has close links, or their enforcement, prevent it from effectively exercising its supervisory functions.
(3) The competent authority may, from time to time, by means of an insurance intermediaries rule issued under this Act define the circumstances in which close links are to be regarded as existing between the intermediary and any other person.
(4) Where the application is for enrolment to carry on insurance intermediaries activities as an insurance agent or insurance manager, the applicant is required to produce proof to the satisfaction of the competent authority that such person holds an appointment in writing signed by a senior officer of an insurer or an insurance broker, as the case may be, for which the applicant desires to act designating the applicant to act in the name and on behalf of the company, or solely on behalf of the company, in the capacity specified in the appointment and in respect of matters and under the conditions specified in that appointment>
Provided that, where an application is for enrolment to act as an insurance manager, the appointment referred in this paragraph shall not constitute a prerequisite condition for granting enrolment in that behalf provided that the enrolled insurance manager shall not act for an insurer or an insurance broker, as the case may be, unless and until it produces proof to the satisfaction of the competent authority that it holds an appointment in writing from the company concerned to act on its behalf.
11. (1) In the case of an applicant which is a local company, such company shall be entitled to be enrolled in the>
(a) Agents List if, in addition to the requirements of article
10 of this Act, the competent authority is satisfied that any one or more of the company’s directors are registered in the Agents Register<
(b) Managers List if, in addition to the requirements of article 10 of this Act, the competent authority is satisfied that any one or more of the company’s directors are registered in the Managers Register<
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Specific qualifications for enrolment in the case of local companies.

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Specific requirements for enrolment in the case of foreign companies.

(c) Brokers List if, in addition to the requirements of article
10 of this Act, the competent authority is satisfied that any one or more of the company’s directors are registered in the Brokers Register,
and the insurance intermediaries activities are carried on under the management of a registered person.
(2) Every person enrolled under article 13 of this Act shall make an application in writing to the competent authority before opening a branch or setting up or acquiring a subsidiary in Malta.
(3) The competent authority may permit a person enrolled as aforesaid to open a branch in Malta if it satisfied that the insurance intermediaries activities carried on by it from the branch are conducted by a registered person.
(4) No person enrolled under this Part of the Act may carry out insurance intermediaries activities or set up or acquire a subsidiary in any country outside Malta, except with the written consent of the competent authority.
12. (1) In the case of an applicant which is a foreign company, such company shall be entitled to be enrolled in the Agents List, Managers List or Brokers List if, in addition to the requirements of article 10 of this Act, the competent authority is satisfied that -
(a) the company is registered or permitted in the country where its head office is situated to carry on insurance intermediaries activities<
(b) the company has in Malta at all times - (i) a branch< and
(ii) a representative>
Provided that, a company carrying on business as an insurance broker restricted to contracts of insurance relating to risks situated outside of Malta may, either in lieu of or in addition to opening a branch in Malta, appoint an insurance manager enrolled under the Act to manage such business< and as long as the insurance manager holds such appointment, the business of insurance broking shall be under the management of a registered insurance broker.
(2) In relation to a branch of a foreign company carrying on insurance intermediaries activities as may be prescribed, the insurance intermediaries activities shall be carried out from such branch by an individual who satisfies the following requirements -
(a) in the case of a company carrying on insurance intermediaries activities-
(i) the individual is registered in the Agents Register, Managers Register or Brokers Register<
(ii) the individual is a director of the company or has authority to act for the company and the insurance intermediaries activities are carried on under his management<
(iii) the individual is not an approved auditor, or a partner or an employee of an approved auditor of the company<
(b) in the case of a company carrying on other insurance intermediaries activities as may be prescribed, provisions as may be prescribed.
13. (1) An application for registration or enrolment under this article shall be made in such form and manner as the competent authority may from time to time determine.
(2) The competent authority shall have the power to require an applicant to provide such information as it may deem necessary for the purpose of determining an application for registration or enrolment under this article.
(3) The competent authority may grant registration or enrolment under this article only if it is satisfied on the basis of the information required to be submitted under this Act and any information received by it, that registration or enrolment ought to be granted.
(4) Subject to the provisions of this Act, the competent authority may subject registration or enrolment made under this article to such conditions as it may from time to time deem fit to impose.
(5) The competent authority shall determine an application for registration or enrolment under this article within three months of receiving the information required to be submitted under this Act< and if it refuses to grant the registration or enrolment it shall inform the applicant in writing of the reasons for the refusal>
A 425

Grant of registration or enrolment by competent authority to insurance intermediaries.

A 426

Certificate of registration or enrolment of intermediaries.

Automatic striking off of registration or enrolment of intermediaries.

Provided that, in each case the competent authority may take such measures as it may deem necessary for the protection of the interest of the public.
14. (1) On granting registration or enrolment under article 13 of this Act, the competent authority shall issue to the applicant concerned a certificate of registration or enrolment in the form and manner as it deems appropriate evidencing -
(a) in the case of an application for registration, registration of the applicant in the Agents Register, Managers Register, or Brokers Register, as the case may be<
(b) in the case of an application for enrolment, enrolment of the applicant in the Agents List, Managers List or Brokers List, as the case may be.
(2) A certificate of registration or enrolment granted under this article or an official copy thereof shall be prominently displayed by the intermediary concerned at his, or its place or places of business, in a part thereof to which the public has access.
(3) The competent authority may by means of an insurance intermediaries rule made for the purposes of this article, determine the details to be included in the certificate of registration or enrolment.
PART IV
POWERS OF INTERVENTION IN RELATION TO PERSONS ENROLLED UNDER PART III OF THIS ACT
15. (1) An intermediary registered or enrolled under this Act shall automatically be struck off the register or list, if -
(a) the intermediary does not commence to carry on the insurance intermediaries activities pursuant to the registration or enrolment within twelve months of it being granted, or within such other period as may be specified in the registration or enrolment< or
(b) the intermediary is declared bankrupt or goes into liquidation or makes a composition with creditors of the intermediary or is otherwise dissolved< or
(c) the intermediary has ceased to operate as a result of a merger with another company carrying on insurance intermediaries activities or for any other reason whatsoever< or
(d) in the case of a foreign company enrolled in terms of article 13 of this Act, the overseas regulatory authority in the country of registration or where the head office is situated withdraws the registration or permission to carry on such activities.
(2) Paragraph (a) of subarticle (1) of this article shall not apply to a person enrolled to act as an insurance manager.
16. Without prejudice to anything contained in any other provision of this Act, the competent authority may at any time suspend registration or enrolment or strike off the name of a registered or enrolled person from the Agents Register, Managers Register or Brokers Register, or the Agents List, Managers List or Brokers List if -
(a) any document or information accompanying an application for registration or enrolment, or any information given in connection therewith, is false, incorrect or misleading in any material particular, or the registered or enrolled person has concealed, or conceals from, or fails to notify to the competent authority any document or information or change therein which was the duty of the intermediary to reveal or to notify under this Act and any regulations made thereunder or any insurance intermediaries rule< or
(b) it considers that the registered or enrolled person does not fulfil the requirements of, or has contravened, any of the provisions of this Act and any regulations made thereunder, or any insurance intermediaries rule, or has failed to satisfy or comply with any condition to which he or it, or the registration or the enrolment, is subject by virtue of or under this Act< or
(c) it considers that the registered or enrolled person is unfit to retain his or its name in the Agents Register, Managers Register, Brokers Register or the Agents List, Managers List or Brokers List< or
(d) the enrolled company is no longer managed in a sound and prudent manner to retain its name in the Agents List, Managers List or Brokers List< or
(e) it receives a written request so to do by the registered or enrolled person< or
A 427

Power of the competent authority to suspend or strike the name off the register or list.

A 428

Notification of intention of suspension or striking a name off the register or list.

(f) the enrolled person no longer possesses the required own funds as applicable< or
(g) the enrolled person fails to pay the annual continuance of registration or enrolment fee when due< or
(h) the registered or enrolled person is declared bankrupt or the enrolled company goes into liquidation or makes a composition with its creditors or is otherwise dissolved< or
(i) the enrolled company ceases to have on its board of directors any one person who is a registered person< or
(j) it considers that, by reason of the manner in which the registered or enrolled person is carrying on insurance intermediaries activities, or for any other valid reason, the interest of the insurance industry or of the public is threatened< or
(k) the registered individual or the enrolled person has misappropriated or converted to his or to its own use or illegally withheld monies held, or required to be held, by him or by it in a fiduciary capacity< or
(l) the registered or enrolled person is convicted by any court of law of any criminal offence, unless it is an offence which, owing to its trivial nature or the circumstances under which it was committed, does not render it or him unfit to have his name in the Agents Register, Managers Register or Brokers Register or the Agents List, Managers List or Brokers List< or
(m) the registered or enrolled person is considered by the competent authority to have carried on insurance intermediaries activities in an unprofessional manner< or
(n) the competent authority is prevented from exercising its supervisory functions effectively because of the existence of close links as may be defined by means of an insurance intermediaries rule made under this Act.
17. (1) Subject to the following provisions of this article, where the competent authority intends to suspend a registration or enrolment or strike the name of a registered or enrolled person off the Agents Register, Managers Register or Brokers Register, or the Agents List, Managers List or Brokers List, it shall give the person concerned notice in writing setting out the reasons for its intention to do so.
(2) Every notice given under subarticle (1) of this article shall state that the person concerned may, within such reasonable period after the service thereof as may be stated in the notice (being a period of not less than forty-eight hours and not longer than fifteen days), make representations in writing to the competent authority giving reasons why the registration or enrolment should not be suspended or the name of the person struck off the Agents Register, Managers Register or Brokers Register, or the Agents List, Managers List or Brokers List, as applicable, and the competent authority shall consider any representations so made before arriving at a final decision.
(3) The competent authority shall notify in writing its final decision to the person concerned.
(4) On notification by the competent authority to a person that his or its name has been suspended or has been struck off the Agents Register, Managers Register or Brokers Register or the Agents List, Managers List or Brokers List, the intermediary shall forthwith surrender to the competent authority the certificate of registration or enrolment, and any official copies thereof< and in each case, the competent authority may take such other measure as it may deem necessary to safeguard the interests of insureds, policyholders, creditors or other interested persons.
(5) Where the competent authority has suspended the registration or enrolment or struck off the name of a person from the Agents Register, Managers Register or Brokers Register or the Agents List, Managers List or Brokers List on any of the grounds specified in article 16 of this Act, it may, if it so elects give publicity to such suspension or striking off in a manner it deems appropriate.
(6) The competent authority shall have power to order that all expenses, incurred by it in relation to such publicity, or such part thereof, as it deems appropriate, shall be paid by the person concerned< and any sum so due shall be recoverable by the competent authority in the same manner as an administrative penalty imposed under this Act.
18. (1) Where the name of a person has been struck off the Agents Register, Managers Register or Brokers Register or the Agents List, Managers List or Brokers List, in pursuance of a decision under article 16 of this Act, the name of that person shall not again be entered in the register or list unless -
(a) otherwise ordered by the Tribunal< or
(b) in the absence of such order, the competent authority, on an application made to it in that behalf, otherwise decides.
A 429

Restoration of a name struck off the register or list.

A 430

Power of the competent authority to protect the public interest.

(2) The competent authority shall determine an application for restoration of a name of a person to the Agents Register, Managers Register, or Brokers Register or the name of an enrolled person to the Agents List, Managers List or Brokers List under this article within three months of receiving the information required to be submitted under this Act as if the application were an application made under article 13 of this Act< and if it refuses to restore a name of an individual or of a company to the register or list, it shall inform the applicant in writing of the reasons for the refusal.
(3) Subarticle (2) of this article shall not apply where the restoration of a name of a person to the Agents Register, Managers Register, and Brokers Register or the Agents List, Managers List or Brokers List is made by an order of the Tribunal.
19. (1) Without prejudice to the powers conferred to the competent authority under article 16 of this Act, the competent authority may, where it is satisfied that sufficient serious circumstances exist, proceed to take one or more of the following measures>
(a) require the intermediary forthwith to take such steps as the competent authority may consider necessary to rectify or remedy the circumstances<
(b) appoint a person to advise the intermediary in the proper conduct of its business<
(c) appoint a person to take charge of the assets of the intermediary, or any portion of them, for the purposes of safeguarding the interests of insureds, policyholders, creditors or other interested persons and, in the case of a local company, shareholders of the company<
(d) appoint a person to assume control of the business of the intermediary, either to carry on that business or to carry out such other function or functions in respect of such business, or part thereof, as the competent authority may direct<
(e) issue an order for the dissolution and winding up of the enrolled company or, in the case of a foreign company, for the winding up of its business in Malta<
(f) appoint a competent person to act as liquidator for the purpose of winding up the affairs of the enrolled company<
(g) fix the remuneration to be paid by the intermediary to any person appointed under this article<
(h) require the intermediary to submit a financial recovery plan if it considers that the interest of insureds, policyholders, creditors or other interested persons are likely to be prejudiced owing to a deterioration in the financial position of the intermediary<
(i) require a registered or enrolled person to remove the word “insurance” as part of his or its description or title and not make use of such word on any letter paper, in any notice or advertisement, or in any another similar manner<
(j) do such other act or require the doing of such other thing as it may deem appropriate in the circumstances,
and having proceeded in any one or more of the manners aforesaid, the competent authority may further proceed in any one or more of such manners, whether in addition thereto or in substitution thereof.
(2) Where a person is appointed by the competent authority -
(a) under paragraph (b) of subarticle (1) of this article, it shall be the duty of the intermediary to act in accordance with the advice given by such person unless and until the competent authority, on representations made to it, directs otherwise<
(b) under paragraph (c) of subarticle (1) of this article, the intermediary shall deliver to such person all the assets of which he is placed in charge, and all the powers, functions and duties of the intermediary in respect of those assets, and in relation to a company, whether exercisable by the company in general meeting, or by the directors, or by any other person, including the legal and judicial representation of the intermediary, shall be exercisable by and vest in the person appointed under the said paragraph to the exclusion of any other person<
(c) under paragraph (d) of subarticle (1) of this article, the intermediary shall submit the business to the control of such person and shall provide him with such facilities as he may require the intermediary to provide him to carry on that business or to carry out the functions assigned to him under the said paragraph< and all the powers, functions and duties of the intermediary, and in relation to a company whether exercisable by the intermediary in general meeting, or by the directors, or by any other person, including the
A 431
A 432

Monies held in a fiduciary capacity.

Fidelity bonds required of insurance intermediaries.

legal and judicial representation of the intermediary in all matters, shall be exercisable by and vest in him to the exclusion of any other person<
(d) under paragraph (f) subarticle (1) of this article, such person shall be the liquidator of the intermediary for all purposes of law to the exclusion of any other person.
(3) In the case of a foreign company, the branches and offices in Malta of that company shall, if the competent authority so directs and to the extent it so directs be deemed to constitute a separate company.
PART V
OBLIGATIONS OF PERSONS ENROLLED UNDER PART III OF THIS ACT
20. (1) Every person enrolled under article 13 of this Act shall keep monies held by him or it in a fiduciary capacity separate from his or its own monies and shall, in respect of those monies, maintain separate accounts in accordance with requirements determined by an insurance intermediaries rule made for the purposes of this article.
(2) No person shall have or obtain any recourse or right against monies standing to the credit of the account referred to in subarticle (1) of this article in respect of a claim or right against an enrolled person until all proper claims arising out of insurance intermediaries activities against those monies have been satisfied, even in the event of bankruptcy of the individual or insolvency of the company, as the case may be.
21. (1) Without prejudice to article 20 of this Act, every person enrolled under article 13 of this Act shall effect a fidelity bond in a specified form, as respects the insurance intermediaries activities carried on by the intermediary concerned, in such circumstances, to such value, in such manner and under such conditions as may be determined by an insurance intermediaries rule made for the purposes of this article.
(2) The bond referred to in subarticle (1) of this article shall provide that in the event of the inability or failure of the enrolled person to meet his or its financial obligations in relation to any sums of money received by him or it from, or on behalf of, his or its clients, a sum of money will become available to a person nominated or approved by the competent authority, to be applied for the benefit of any client of the
enrolled person who has incurred loss or liability because of the inability or failure of the enrolled person to meet such financial obligations.
22. The provisions of articles 20 and 21 of this Act shall not apply to a person enrolled as an insurance manager for so long as such person holds no appointment from any insurer or an insurance broker for so acting.
23. Every enrolled company shall, not later than the end of January of each year, notify in writing the competent authority in such manner as the competent authority may require, the name and the other particulars as it may also require, of every director and employee of the company who are registered in the Agents Register, Managers Register or Brokers Register< and during the following twelve months, the company shall give notice in writing to the competent authority of any change that may, from time to time, occur among such directors and employees and such notice shall be given within such period as may be specified by an insurance intermediaries rule.
24. (1) Every enrolled company shall, not later than four months from the date of closing of its financial year, or at any other time as may exceptionally be authorised in writing by the competent authority, forward to the competent authority a copy of its audited financial statements drawn up -
(a) in the case of a local company, in accordance with the provisions of the Companies Act< and
(b) in the case of a foreign company, in accordance with the provisions of the laws of the country where the registered office or head office of the company is situated governing the financial statements of such companies.
(2) Every enrolled person who is an individual shall provide income statements drawn up in a manner as determined by an insurance intermediaries rule made for the purposes of this article and such statements shall be forwarded to the competent authority within such period as may be specified in the rule.
25. (1) Subject to the following subarticles, an enrolled person which in any calendar year carries on insurance intermediaries activities shall, in respect of the insurance intermediaries activities so carried on by it, forward to the competent authority a statement relating to that business made out in the form, manner and content as the competent authority may, by an insurance intermediaries rule made for the purposes
A 433

Exemptions applicable to insurance managers.

Notification of persons registered in the register.

Submission of audited financial statements and income statements.

Cap. 386.

Submission of business of insurance intermediaries statements.

A 434

Enrolled persons ceasing to carry on insurance intermediaries activities.

Financial year of insurance intermediaries.

of this article determine< and the date by which such statement shall be forwarded shall also be established by that rule.
(2) The statement required to be submitted under this article shall be verified in the manner required by the insurance intermediaries rule.
(3) The competent authority may at any time direct an enrolled person to submit to it such statement at such interval and for such period as it may specify in such rule.
26. An enrolled person shall not cease to carry on, in Malta, insurance intermediaries activities except with the permission of the competent authority given in writing on an application made to it in that behalf in such manner as it may require, and in compliance with such conditions as it may deem proper to impose.
PART VI
FINANCIAL YEAR AND AUDITORS
27. (1) A company enrolled under article 13 of this Act which is a local company shall, not later than three months from the date of a company’s enrolment, notify in writing the competent authority of the financial year and, failing such notice, the financial year of the enrolled company shall terminate on the thirty-first day of December of each year.
(2) No enrolled company as aforesaid shall alter its financial year unless and until the competent authority has given its approval in writing on an application made to it in that behalf.
(3) Every foreign company applying for enrolment under article 13 of this Act shall, on application, notify in writing the competent authority of its financial year< and after enrolment under that article, where a foreign company alters its financial year, it shall forthwith inform in writing the competent authority of such change.
(4) For the purposes of this Act “financial year”-
(a) in relation to an enrolled company which is a local company, means an accounting period as is construed in accordance with articles 164 to 166 of the Companies Act<
(b) in relation to an enrolled company which is a foreign company, means an accounting period as is construed in accordance with the provisions of the laws of the country where the registered office or the head office of the company is situated governing the accounting period of such companies.
28. (1) Every company enrolled under article 13 of this Act shall each year appoint an approved auditor as auditor to the company whose duty shall be to report on the financial statements of the company examined by him and on financial statements prepared by the company.
(2) If the enrolled company fails to appoint an auditor as required by subarticle (1) of this article or at any time fails to fill any vacancy in the office of an auditor, the competent authority shall have the power to appoint an auditor for that company and shall fix the remuneration to be paid by that company to such auditor.
(3) The auditor’s report shall include a statement as to whether the various requirements of this Act and of any regulations made thereunder and of any insurance intermediaries rule in respect of the enrolled company have been complied with and observed.
(4) Every auditor of an enrolled company shall have the right to demand such information or explanation as he deems necessary in the performance of his duties from any officer or employee of, or any person under an appointment from, that company.
(5) An auditor shall immediately give notice in writing to the competent authority if -
(a) he resigns<
(b) he does not seek to be re-appointed< or
(c) he decides to qualify the audit report,
and, in the situations mentioned in paragraphs (a) and (b) of this subarticle, the auditor shall specify the reasons for so doing.
(6) An enrolled company shall give notice in writing to the competent authority immediately it receives notice of a resolution intended to be put before the company’s annual general meeting to appoint as an auditor a person other than the retiring auditor or otherwise providing expressly that the retiring auditor shall not be reappointed.
A 435

Appointment, duties and termination of appointment of auditors.

A 436
(7) Where, for any reason whatever, the appointment of an auditor comes to an end, the enrolled company shall, not later than fourteen days from the termination of such appointment, give notice in writing to the competent authority stating reasons for such termination.
(8) The competent authority may require an enrolled company to change its appointed auditor where, in the competent authority’s opinion, such auditor is considered unfit for this appointment, at any time during his term of office.
(9) Before requiring an enrolled company to change the appointed auditor in the circumstances mentioned in subarticle (8) of this article, the competent authority shall notify in writing its intention to the company and the auditor concerned stating reasons for requiring such change and giving the auditor the opportunity to submit, in writing, within fourteen days from the date of serving of such notice, the reasons why his appointment with the company should not be terminated.
(10) For the purposes of this Act, an approved auditor shall be a person who is qualified to be an auditor in accordance with the Companies Act and holds the authorisation of the competent authority to act as auditor issued to him under the Insurance Business Act.
(11) Notwithstanding anything contained in the foregoing subarticles, the competent authority may, in the case of a foreign company, approve such alternative arrangements as it thinks reasonable and which do not materially detract from the main objects of this article, and where such arrangements have been carried out, the provisions of this article shall not apply to the extent that they are replaced by such arrangements.
(12) If, in his capacity as auditor of an enrolled company or due to a direct request by the competent authority under this Act, an auditor becomes aware of any matter which relates to and may have a serious adverse effect upon the stability and soundness of the company or the integrity of the insurance intermediaries activities carried on in Malta, he shall immediately inform the competent authority through the intermediary’s management or, if circumstances so warrant, directly to the competent authority.
(13) For the purposes of subarticle (12) of this article, any matter which relates to and may have a serious adverse effect is any matter that>
(a) is likely to lead to a serious qualification or refusal of the auditor’s report on the accounts of the company< or
(b) gravely impairs the company’s ability to continue as a going concern or to continue carrying on the activities in respect of which it is enrolled< or
(c) may be prescribed by the Minister.
(14) An auditor of an enrolled company shall likewise have a duty to report to the competent authority any facts and decisions which relate to or have a serious adverse effect upon the stability and soundness of the company or the integrity of the insurance intermediaries activities carried on in Malta, of which he becomes aware in his capacity as an auditor to an enrolled company having close links within the meaning of article 10 of this Act.
29. No duty, including the duty of professional secrecy, to which -
(a) an auditor of a company enrolled under article 13 of this Act may be subject, shall be regarded as contravened by reason of his communicating in good faith to the competent authority, whether or not in response to a request from it, any information or opinion on a matter of which the auditor has become aware in his capacity as auditor and which is relevant to any functions of the competent authority under the provisions of this Act or is required to be communicated by virtue of this Act<
(b) a person appointed to make a report under any provision of this Act may be subject, shall be regarded as contravened by reason of his communicating in good faith to the competent authority, whether or not in response to a request made by it, on any matter which relates to the business or affairs of an enrolled company in relation to which a report is made.
PART VII
PROVISIONS APPLICABLE TO INTERMEDIARIES CARRYING ON BUSINESS AS INSURANCE BROKERS
30. A local company enrolled under article 13 of this Act and carrying on business as an insurance broker, restricted to contracts of insurance relating to risks situated outside of Malta, may appoint an
A 437

Communication by auditors etc. with the competent authority.

Appointment of insurance managers by enrolled insurance brokers.

A 438

Contracts of insurance relating to risks situated in Malta or to commitments where Malta is the country of the commitment.

Underwriting agreements.

insurance manager enrolled under the Act to manage such business< and so long as the insurance manager holds such appointment, the business of insurance broking shall be under the management of a registered insurance broker.
31. (1) Subject to the following subarticles, except with the approval of the Minister given generally by order in the Gazette, or with the approval of the competent authority given specifically in writing, a contract of insurance relating to a risk situated in Malta or to a commitment where Malta is the country of the commitment negotiated, arranged or procured by an insurance broker on behalf of an insured person or a person to be insured shall be taken out with an authorised company.
(2) Where a contract of insurance is a contract of a general business class or part class – falling within group 3 of Part II of the Third Schedule to the Insurance Business Act, and such contract is a contract relating to a risk situated in Malta and is taken out with a Mutual Association, which is not a European insurance undertaking, that Mutual shall have to be a Mutual within the meaning of a “Mutual Association” as construed in accordance with subarticle (3) of article 6 of the said Act< and the Mutual shall have to satisfy or comply with the requirements of the insurance rule made for the purposes of the said article either on or before the date of commencement of such contract or not later than thirty days from the date of such commencement.
(3) Save as otherwise provided in subarticle (2) of this article, the provisions of this article shall not apply to -
(a) business of reinsurance<
(b) large risks as defined by Article 5 of the Second Council Directive 88#357#EEC of 22nd June 1988 on the coordination of laws, regulations and administrative provisions relating to direct insurance other than the life assurance and laying down provisions to facilitate the effective exercise of freedom to provide services and amends Directive 73#239#EEC.
32. (1) Subject to the following subarticles, any person enrolled in the Brokers List under article 13 of this Act may make or enter into any underwriting agreement with any authorised company.
(2) No person enrolled as aforesaid shall make or enter into any underwriting agreement unless, with respect to that underwriting agreement, the person complies with or satisfies such requirements as
the competent authority may by an insurance intermediaries rule made for the purpose of this article determine.
(3) Any person enrolled as aforesaid shall register with the competent authority any underwriting agreement made or entered into under this article in the form and manner as the competent authority may by an insurance intermediaries rule determine.
(4) No business of insurance shall be accepted under an underwriting agreement unless the underwriting agreement has been duly registered as aforesaid.
(5) The competent authority shall determine an application for registration of an underwriting agreement under this article within one month of receiving the information required to be submitted under the insurance intermediaries rule< and if it refuses to register the agreement it shall inform the applicant in writing of the reasons for the refusal.
(6) Subject to the provisions of this Act, the competent authority may subject registration of any underwriting agreement made under this article to such conditions as it may from time to time deem fit to impose.
(7) For the purposes of this article “underwriting agreement”, in relation to business of insurance, means an agreement between an authorised company and a person enrolled in the Brokers List under article 13 of this Act under which the enrolled person may, in accordance with the terms thereof, accept risks on behalf of the authorised company< and, in this context, any other arrangement, by whatever name it may be called, whose objects and purposes are similar to an underwriting agreement, for the purposes of this article, is deemed to be an underwriting agreement.
PART VIII
REGISTRATION AND ENROLMENT OF TIED INSURANCE INTERMEDIARIES
33. (1) Subject to subarticle (2) of this article, no person shall act as a tied insurance intermediary and carry out, or attempt to carry out in Malta tied insurance intermediaries activities unless such person is appointed, registered and enrolled in accordance with the provisions of this Act.
A 439

Restriction on persons for carrying out tied insurance intermediaries activities.

A 440

Tied Insurance Intermediaries Company Registers.

Qualifications for registration.

List of persons carrying out tied insurance intermediaries activities.

(2) This article shall not apply to a tied insurance intermediary, which is registered pursuant to Directive 2002#92#EC of the European Parliament and of the Council of 9 December 2002 on insurance mediation in a Member State or an EEA State, other than Malta.
34. (1) Subject to article 43 of this Act, every authorised company desirous of appointing a person to act on its behalf as a tied insurance intermediary shall establish and maintain a register of persons acting as tied insurance intermediaries, in this Act referred to as the “Tied Insurance Intermediaries Company Register”, containing the particulars as the competent authority may, from time to time, by an insurance intermediaries rule made for the purposes of this article, determine, of all persons who are entitled under this Act to be registered therein.
(2) Subject to the provisions of subarticle (1) of this article, every authorised company shall determine its own procedures for appointing and registering a person as a tied insurance intermediary in the Tied Insurance Intermediaries Company Register.
35. (1) A person shall be entitled to be registered by an authorised company in the Tied Insurance Intermediaries Company Register of the company if the company is satisfied that such person is fit and proper to carry out tied insurance intermediaries activities.
(2) A person shall not be entitled to carry out tied insurance intermediaries activities, by virtue of his registration under article 37 of this Act unless and until he is enrolled by the competent authority in the Tied Insurance Intermediaries List under that article.
36. (1) The competent authority shall establish and maintain a list of persons carrying out tied insurance intermediaries activities in this Act referred to as the “Tied Insurance Intermediaries List”, containing such particulars as the competent authority may, determine from time to time by an insurance intermediaries rule made for the purposes of this article of all persons who are, or which are, entitled under this article to be enrolled therein.
(2) It shall be the duty of an authorised company to enrol with the competent authority in the Tied Insurance Intermediaries List any person registered by it as a tied insurance intermediary in the Tied Insurance Intermediaries Company Register of the company under article
37 of this Act.
(3) On obtaining from the competent authority a certificate of enrolment under article 37 of this Act, an authorised company shall furnish the person, in whose name the certificate of enrolment is made out, with the certificate or an official copy thereof, issued to the company by the competent authority.
(4) Where a person enrolled as aforesaid carries out tied insurance intermediaries activities from a place of business or from any other place accessible to the public, that person shall display in a prominent position in that place in a part thereof to which the public has access, the certificate of enrolment or an official copy thereof issued by the competent authority under this article.
37. (1) Subject to the provisions of this Act, every authorised company desirous of appointing a person to act on its behalf as a tied insurance intermediary shall, under this article, appoint and register in the Tied Insurance Intermediaries Company Register of the company and enrol with the competent authority in the Tied Insurance Intermediaries List, any one or more persons to act on its behalf as tied insurance intermediaries and to carry out tied insurance intermediaries activities in the class or classes of long term business or the group or groups of classes of general business specified in their respective appointments and, where a person is not an individual, such person must itself have an individual who satisfies the requirements of subarticle (1) of article 35 of this Act>
Provided that, a company is prohibited from appointing and registering in the Tied Insurance Intermediaries Company Register of the company a person which is -
(a) a person registered in the Agents Register, Managers
Register or Brokers Register under article 13 of this Act<
(b) a person enrolled in the Agents List, Managers List or
Brokers List under that article<
(c) a company authorised under the Insurance Business Act to carry on business of insurance>
Provided further that a company is prohibited from appointing any person acting on its behalf as a tied insurance intermediary to carry out any tied insurance intermediaries activities within any class or group of classes of business of insurance as the competent authority may, from time to time, by an insurance intermediaries rule made for the purposes of this article determine to be a class or
A 441

Appointment, registration and enrolment of tied insurance intermediaries.

A 442
group of classes of business within which no tied insurance intermediaries activities shall be carried out.
(2) Where an authorised company appoints and registers in the Tied Insurance Intermediaries Company Register of the company a person which is not an individual, and that person carries out tied insurance intermediaries activities from any one or more places of business, that person shall ascertain that tied insurance intermediaries activities so carried out by it from each such place of business are carried out only by an individual who satisfies the requirements of subarticle (1) of article 35 of this Act.
(3) Subject to subarticles (4) and (5) of this article, any person, other than a person mentioned in the first proviso to subarticle (1) of this article, may seek and obtain under this article appointment and registration in a Tied Insurance Intermediaries Company Register of an authorised company to carry out tied insurance intermediaries activities on behalf of that company.
(4) Where a person desires to seek appointment and registration in the Tied Insurance Intermediaries Company Register of more than one company authorised to carry on long term business, and where any class of long term business carried on by the companies concerned is of the same kind, such person shall, in respect of that class of business, seek and obtain appointment and registration to carry out tied insurance intermediaries activities relating to that kind of class of business only in the Tied Insurance Intermediaries Company Register of one of the companies concerned.
(5) Where a person desires to seek appointment and registration in the Tied Insurance Intermediaries Company Register of more than one company authorised to carry on general business, and where any class, or any group of classes, of general business carried on by the companies concerned is of the same kind, such person shall, in respect of that class, or that group of classes of business, seek and obtain appointment and registration to carry out tied insurance intermediaries activities relating to that class, or that group of classes of business only in the Tied Insurance Intermediaries Company Register of one of the companies concerned.
(6) No person who is an employee of an authorised company shall, solely by virtue of his employment by the company, require registration in the Tied Insurance Company Register of the company under this article.
(7) (a) On granting an application for enrolment under this article, the competent authority shall issue to the applicant concerned a certificate of enrolment evidencing enrolment of the person registered in the Tied Insurance Intermediaries Company Register of the applicant in the Tied Insurance Intermediaries List.
(b) The competent authority may by means of an insurance intermediaries rule made for the purposes of this article, determine the details to be included in the certificate of enrolment.
(8) Subject to the provisions of this Act, the competent authority may subject enrolment made under this article to such conditions as it may from time to time deem fit to impose.
(9) An authorised company shall at all times be responsible for any act or omission of its registered tied insurance intermediaries provided that such act or omission is an act or omission pertaining to a contract of insurance issued by the company or offered on its behalf through the services of such tied insurance intermediaries. For the purposes of this subarticle any reference to registered tied insurance intermediaries shall include a reference to past as well as present registered tied insurance intermediaries.
38. (1) Without prejudice to subarticle (3) of this article, every tied insurance intermediary, shall, in respect of monies held by him or it in relation to a policy of insurance, keep such monies held by him or it separate from his or its own monies and shall, in respect of those monies maintain separate accounts in accordance with requirements determined by an insurance intermediaries rule made for the purposes of this article.
(2) No person shall have or obtain any recourse or right against monies standing to the credit of the account referred to in subarticle (1) of this article in respect of a claim or right against a person acting as a tied insurance intermediary until all proper claims arising out of insurance intermediaries activities against those monies have been satisfied, even in the event of bankruptcy of the individual or insolvency of the company, as the case may be.
(3) Notwithstanding the provisions of subarticles (1) and
(2) of this article>
(a) monies received by the tied insurance intermediary from a person in relation to a contract of insurance shall be treated as having been paid to the company issuing or offering the contract, and on whose behalf the tied insurance intermediary carries on tied insurance intermediaries activities< and
A 443

Maintenance of separate accounts.

A 444

Striking name off Tied Insurance Intermediaries Company Register.

Striking name off Tied Insurance Intermediaries Company Register or the Tied Insurance Intermediaries List.

(b) monies paid by the authorised company to the tied insurance intermediary, and intended for the policyholder, shall not be treated as having been paid to the policyholder until such monies are actually received by the policyholder concerned.
39. Subject to the provisions of article 40 of this Act and to the terms and conditions of any relevant tied insurance intermediaries appointment at any time and for any reason whatsoever -
(a) any authorised company may strike off the Tied Insurance Intermediaries Company Register of the company the name of any person registered in the said register<
(b) any person registered in the Tied Insurance Intermediaries Company Register of an authorised company may make an application in writing to the company concerned requesting the company to strike his name off the said register.
40. (1) Where an authorised company elects to strike the name of a person off the Tied Insurance Intermediaries Company Register of the company, the company shall forthwith notify in writing the person concerned and the competent authority specifying the date on which it elects to strike the name of that person off the register.
(2) Where an authorised company strikes the name of a person off the Tied Insurance Intermediaries Company Register of the company on grounds of unfitness and improperness or because the person concerned has acted fraudulently, or dishonestly, or in such manner as to cease to be trustworthy, the company shall also notify in writing the competent authority the reasons for so doing.
(3) On receiving a notification from an authorised company that the company has elected to strike the name of a person off the Tied Insurance Intermediaries Company Register of the company, the competent authority shall -
(a) if the striking of such name off the register is on grounds other than those specified in subarticle (2) of this article, as early as reasonably practicable, confirm in writing to the company concerned that the name of such person, in so far as it relates to that company, shall be struck off the Tied Insurance Intermediaries List as from the date specified in the company’s notification<
(b) if the striking of such name off the register is on grounds specified in subarticle (2) of this article, before striking the name of such person off the Tied Insurance Intermediaries List, forthwith,
give the person concerned notice in writing setting out the reasons for so doing and the provisions of subarticles (2) and (3) of article
17 of this Act shall mutatis mutandis apply to a notice given under this article.
(4) Without prejudice to any action which the competent authority may deem appropriate under this Act or any other law, where the competent authority strikes the name of a person off the Tied Insurance Intermediaries List on the grounds specified in subarticle (2) of this article, the competent authority may give publicity to the striking of that name off the Tied Insurance Intermediaries List and -
(a) if the name of that person is registered in the Tied Insurance Intermediaries Company Register of any other company, the competent authority shall also forthwith notify in writing that other company and direct it to strike forthwith the name of that person off the Tied Insurance Intermediaries Company Register of that company and give the company the reasons for its direction<
(b) if the competent authority elects to give publicity to the striking of that name off the Tied Insurance Intermediaries List, the competent authority shall publish a notice giving publicity to that striking off in a manner it deems appropriate.
(5) The competent authority shall have power to order that all expenses incurred by the publication of a notice pursuant to this article, or such part thereof as it may deem appropriate, shall be paid by the person concerned< and any sum so due shall be recoverable by the competent authority in the same manner as an administrative penalty imposed under this Act.
(6) Where an authorised company receives in writing an application from a person registered in the Tied Insurance Intermediaries Company Register of the company requesting the company to strike the name of that person off the said register, the company shall without undue delay strike the name of that person off the said register and notify in writing the person concerned and the competent authority specifying the date on which it elects to strike the name of that person off the register.
(7) Where, on an application made to an authorised company under subarticle (6) of this article, the company refuses, or unduly prolongs the process, to strike the name of a person off the Tied Insurance Intermediaries Company Register of the company, the person concerned may refer the matter to the competent authority and the competent authority shall issue in writing to the company concerned those directives
A 445
A 446

Protection of the public or other interest.

Restoration of a name struck off the Tied Insurance Intermediaries List.

Application of Part VIII of the Act and European insurance undertakings.

it deems necessary to oblige the company to hasten the process to strike the name of that person off its register.
(8) On notification by the competent authority to an authorised company that the name of a person registered in the Tied Insurance Intermediaries Company Register of the company has been struck off the Tied Insurance Intermediaries List, the company concerned shall forthwith surrender to the competent authority the certificate of enrolment relating to that person, and any official copies thereof.
41. (1) Notwithstanding any provision of this Act, the competent authority may, at any time, on grounds of unfitness and improperness or of protection of the public interest -
(a) refuse to enrol a person in the Tied Insurance
Intermediaries List<
(b) strike the name of a person off the Tied Insurance
Intermediaries List>
Provided that, in each case, the competent authority shall inform the company concerned in writing of the reasons for so doing.
(2) In each case the competent authority may take any other measure as it may deem necessary to safeguard the interests of insureds, policyholders, creditors or other interested persons.
42. Where in pursuance of article 40 of this Act the name of a person has been struck off the Tied Insurance Intermediaries List -
(a) on grounds contained in subarticle (2) of that article, the name of that person shall, upon application by an authorised company, again be enrolled in the Tied Insurance Intermediaries List only on the order of the Tribunal or on acquittal from an offence under that subarticle by any court<
(b) on grounds other than those contained in subarticle (2) of that article, the name of that person may, upon application by an authorised company, again be enrolled in the Tied Insurance Intermediary List.
43. (1) Subject to subarticle (2) of this article, for the purposes of this Part of this Act, “authorised company” shall not include European insurance undertakings.
(2) In the case of a European insurance undertaking seeking to appoint a person resident in Malta or having its registered office or head office in Malta to carry out tied insurance intermediaries activities, that undertaking shall enrol such person with the competent authority as may be determined by an insurance intermediaries rule made for the purposes of this article and the said rule shall contain the particulars, conditions and requirements for enrolment.
PART IX GENERAL PROVISIONS
44. (1) Every person registered or enrolled under this Act, shall notify in writing the competent authority of any material changes in the documentation provided or required to be provided by or under this Act and any regulations made thereunder, or any insurance intermediaries rule, as soon as the registered or enrolled person becomes aware of such changes.
(2) Without prejudice to article 54 of this Act insofar as it refers to article 38 of the Insurance Business Act, a person enrolled as a local company under this Act shall -
(a) before making any addition or alteration to the memorandum or articles of association or other instrument constituting the company, submit in writing to the competent authority particulars of the proposed addition or alteration for its prior consent< and no such addition or alteration shall be made or shall be registered, or shall take effect, whether it is registered or not, unless and until the competent authority has signified its consent in writing< and
(b) inform the competent authority of the names of the persons holding a qualifying shareholding in the company and the percentage of such holdings< and the competent authority may, by an insurance intermediaries rule made for the purposes of this article, determine the form, manner and content of the information to be forwarded to it and the date by which such information shall be forwarded shall also be established by that rule.
(3) Without prejudice to the foregoing provisions of this article, a person enrolled under Part III of this Act, shall notify the competent authority on a continuous basis, with any change or circumstance which may give rise to the existence of close links within the meaning of article 10 of this Act.
A 447

Changes in documentation.

A 448

Co-operation in supervisory duties and sharing of information.

45. (1) The competent authority may exercise the following powers at the request of or for the purposes of assisting an overseas regulatory authority -
(a) the power to impose, revoke or vary conditions on the grant of a registration or enrolment pursuant to the provisions of subarticle (4) of article 13 of this Act<
(b) the power to suspend or strike off the name of a registered person from the Agents Register, Managers Register or Brokers Register or of an enrolled person from the Agents List, Managers List or Brokers List under article 16 of this Act<
(c) the power to strike off the name of a tied insurance intermediary off the Tied Insurance Intermediaries List enrolled under article 41 of this Act<
(d) the power to take any action under articles 29, 30, 31 or
31A of the Insurance Business Act, as applicable in accordance with article 54 of this Act<
(e) the power to communicate to the overseas regulatory authority information in its possession, whether such information is the result of any of the above powers or otherwise.
(2) The competent authority shall exercise powers by virtue of this article>
(a) where the assistance is requested by the overseas regulatory authority for the purposes of the exercise of one or more of its regulatory functions< or
(b) where so required within the terms of Malta’s international commitments< or
(c) where so required within the terms of undertakings assumed in bilateral or multilateral agreements for the exchange of information and other forms of collaboration with overseas regulatory authorities including a request under a memorandum of understanding concluded with the competent authority.
(3) There shall be meetings held between an authorised company, an insurance intermediary, an approved auditor and the competent authority on a bilateral or a multilateral basis as circumstances may warrant. Such meetings may be called by any of the parties and shall in each case be chaired by the competent authority.
46. (1) Nothing in this Act shall authorise the competent authority to enquire or cause an enquiry to be made in relation to an enrolled person into the affairs of any individual client of the enrolled person except for the purpose of ensuring compliance with any of the provisions of this Act or any other Act.
(2) Subject to the provisions of subarticle (3) of this article, information obtained by any person for the purposes of, or pursuant to, any of the provisions of this Act, or of any regulations made thereunder, or of any insurance intermediaries rule, or in the discharge of any functions under any of the said provisions, or from an overseas regulatory authority shall be treated as confidential and protected by the duty of professional secrecy, and shall not be disclosed to any other person, not being a person who may lawfully obtain that information for the purposes of, or pursuant to, the provisions of this Act, or of any regulations made thereunder or of any insurance intermediaries rule except with the consent of the person from whom he obtained the information, provided the information relates solely to that person.
(3) The provisions of subarticle (2) of this article, shall not preclude the disclosure of information -
(a) with a view to the institution of, or otherwise for the purposes of, criminal proceedings or of any proceedings by the competent authority before any court under this Act<
(b) with a view to enabling or assisting the competent authority in the performance or discharge of any of its functions under this Act<
(c) which has been made available to the public by virtue of being disclosed on any circumstances in which, or for any purposes for which, disclosure is not precluded by this article<
(d) in a summary or collection of information formed in such a way as not to enable the identity of any person to whom the information relates to be ascertained<
(e) to an auditor where the competent authority considers that such disclosure would assist the auditor in the exercise of his functions under article 28 of this Act<
(f) to the Central Bank of Malta or to the Listing Authority under the Financial Markets Act, where such information is required by the Bank or the Listing Authority in the exercise of their respective functions in terms of law<
A 449

Confidentiality.

Cap. 345.

A 450
(g) in response to a request from or for the purposes of assisting, an overseas regulatory authority pursuant to article 45 of this Act<
(h) to such other local or overseas regulatory, judicial or enforcement authorities where such disclosure is required or requested for the pursuance of serious regulatory concerns or the deception, prevention or prosecution of criminal offences<
(i) in civil or commercial proceedings in relation to the bankruptcy, insolvency or compulsory winding up of an insurance intermediary provided such information does not concern third parties involved in attempts to rescue an insurance intermediary, and to such overseas bodies responsible for the liquidation and bankruptcy of a person who is registered or holds an equivalent authorisation or licence from an overseas regulatory authority or for other similar procedures.
(4) No person, including past and present officers or agents of an enrolled person, shall disclose any information relating to the affairs of an enrolled person or of a client of the enrolled person concerned which he has acquired in the performance of his duties or the exercise of his functions under this Act except -
(a) when authorised to do so under any of the provisions of this Act<
(b) for the purpose of the performance of his duties or the exercise of his functions<
(c) when lawfully required to do so by any court or under a provision of any law.
(5) In this article, the expression “agents”, in relation to an enrolled person, means and includes the bankers and the auditor of the enrolled person.
(6) When an officer or an employee of an enrolled company, or a person registered or enrolled, or an officer or an employee of such person, has reason to believe that an activity or a proposed activity could involve money laundering, he shall act in accordance with regulations laid down under the Prevention of Money Laundering Act and any guidelines issued by the competent authority. Compliance with the provisions of this subarticle shall not constitute a breach of confidentiality.
47. (1) The Agents Register, Managers Register and Brokers Register and the Agents List, Managers List, Brokers List, and Tied Insurance Intermediaries List shall be accessible to the public, free of charge, at the offices of the competent authority at all times during the normal working hours of the competent authority.
(2) Any person may, upon payment of such fee as may be prescribed, obtain from the competent authority extracts from the Agents Register, Managers Register or Brokers Register and the Agents List, Managers List or Brokers List, and the Tied Insurance Intermediaries List and official copies of certificates of registration or enrolment.
(3) The Tied Insurance Intermediaries Company Register of any local company authorised under the Insurance Business Act shall be open to public inspection, free of charge, at the principal office of the company concerned during the normal working hours of the company.
48. (1) Subject to the following provisions of this article, save with the written permission of the competent authority, no person other than -
(a) a person registered in the Agents Register, Managers
Register or Brokers Register under article 13< or
(b) a person enrolled in the Agents List, Managers List or
Brokers List under that article< or
(c) a person enrolled in the Tied Insurance Intermediaries
List under article 36< or
(d) a company authorised under the Insurance Business Act<
A 451

Access to the public of the registers and the lists.

Use of the word

“insurance”.

or
(e) a person who holds insurance qualifications of an
institute of repute recognised for such purpose by the competent authority< or
(f) an institute of repute which provides instruction in insurance business studies and is recognised as such by the competent authority< or
(g) a person prescribed by regulations under this Act,
shall use the word “insurance” as part of his or its description or title or make any such use on any letter paper, in any notice or advertisement, or in any other similar manner.
A 452

Service of notices, etc.

(2) Any foreign company enrolled or authorised as aforesaid may use the name used in its country of registration, incorporation or constitution save that, where there is a risk that the use of such name may be misleading, such company shall add such explanatory particulars to its name as the competent authority shall direct.
(3) The competent authority may, by an insurance intermediaries rule made for the purpose of this article, determine the qualifications or experience for carrying on insurance intermediaries activities which are required of persons, other than persons referred to in the foregoing subarticles of this article, who, on application to the competent authority, may be permitted under this article to use the word “insurance” as part of their description or title.
(4) For the purposes of this article, the expression “insurance” includes reinsurance, assurance and reassurance and any of their derivatives or other words as may indicate or purport to indicate the carrying on of business of insurance or the carrying out of insurance intermediaries activities or the carrying on of such business or the carrying out of such activities in any language in the description or title under which a person is carrying on such business or carrying out such activities.
49. A notice or other document to be given or served under this Act and any regulations made thereunder shall be deemed to have been duly given or served on a person if -
(a) it has been delivered to him< or
(b) it has been left at the address furnished by him to the competent authority, or at his last known address< or
(c) it has been sent to him by post or by telefax at any of the aforesaid addresses< or
(d) in the case of a commercial partnership registered in Malta, it has been delivered, sent by post or by telefax, or left at the registered office, or at the last known registered office, of that commercial partnership< or
(e) in the case of any other body of persons, whether corporate or unincorporate, it has been given or served in any of the manners aforesaid to or on a director, an officer, a clerk or the representative of that body.
50. (1) (a) For the purposes of any appeal made to the Tribunal under this Act, the provisions of the proviso to subarticle (1) of article 57 of the Insurance Business Act shall apply.
(b) For the purposes of any such appeal, the provisions of article 21 of the Malta Financial Services Authority Act shall also apply.
(2) Subject to the provisions of this article, any person who, or any company which, is aggrieved by a decision of the competent authority -
(a) to refuse to register or to enrol an applicant under article
13 or 41 of this Act<
(b) to impose any condition on, or subsequent to, registration and enrolment under article 13 or 37 of this Act<
(c) to suspend or strike the name of a person off the Agents Register, Managers Register or Brokers Register or the name of an enrolled person off the Agents List, Managers List or Brokers List under article 16 of this Act<
(d) to refuse to restore the name of a person to the Agents Register, Managers Register or Brokers Register or the name of an enrolled person to the Agents List, Managers List or Brokers List under subarticle (2) of article 18 of this Act<
(e) to refuse to register an underwriting agreement under article 32 of this Act<
(f) to strike the name of a person off the Tied Insurance
Intermediaries List under paragraph (b) of subarticle (3) of article
40 of this Act<
(g) to require a company authorised under the Insurance Business Act to strike the name of a person off the Tied Insurance Intermediaries Company Register of a company under article 41 of this Act<
(h) to impose an administrative penalty in respect of infringements as may be prescribed under article 3 of this Act,
may appeal against the decision to the Tribunal which shall have exclusive competence to hear appeals on the matters listed in this subarticle.
A 453

Appeals.

A 454

Exclusion of liability.

Offences.

(3) An appeal under this article shall lie only on any of the following grounds -
(a) that the competent authority has wrongly applied any of the provisions of this Act< or
(b) that the decision of the competent authority constitutes an abuse of discretion or is manifestly unfair, provided that the discretion of the competent authority may not, so long as it has been exercised properly, be queried by the Tribunal.
(4) An appeal made under this article shall not suspend the operation of any decision from which the appeal is made except in the case of an appeal from a decision as is mentioned in paragraph (h) of subarticle (2) of this article>
Provided that, a decision to strike the name of a person off the Agents Register, Managers Register or Brokers Register or Agents List, Managers List or Brokers List shall not become operative until the expiration of the period within which an appeal may be made under this article and, if an appeal is made within such period, the decision shall become operative on the date of the decision of the Tribunal dismissing the appeal or the date in which the appeal is abandoned.
51. The competent authority and any member, officer or employee of the competent authority, and any other person appointed to perform a function under this Act and any regulations made thereunder shall not be liable in damages for anything done or omitted to be done in the discharge or purported discharge of any functions under this Act and any regulations aforesaid, unless the act or omission is shown to have been done or omitted to be done, as the case may be, in bad faith.
52. (1) Any person -
(a) who for the purpose of obtaining the registration or enrolment under this Act or any regulations made thereunder furnishes information or makes a statement or a declaration which the person knows to be inaccurate, false or misleading in any material particular, or recklessly furnishes information or makes a statement or a declaration which is inaccurate, false or misleading in any material particular< or
(b) who contravenes or fails to comply with any of the provisions of this Act or of article 29, 30, 31A or 38 of the Insurance Business Act, as applicable in accordance with article 54 of this Act<
A 455
(c) who contravenes or fails to comply with any regulations made under this Act, other than regulations in relation to which administrative penalties have been prescribed under paragraph (h) of subarticle (2) of article 3 of this Act<
(d) who contravenes or fails to comply with any insurance intermediaries rule or registration or enrolment condition<
(e) who fails to comply with any lawful order or requirement of the competent authority<
(f) who fails to comply with any lawful order or requirement of any other person made under this Act and any regulations made thereunder<
(g) who without any reasonable excuse alters, suppresses, conceals, destroys or refuses to produce any document which is lawfully required to be produced by any person under this Act and any regulations made thereunder< or
(h) who intentionally obstructs a person exercising rights conferred by this Act or any regulations made thereunder,
shall be guilty of an offence.
(2) Any person who is knowingly a party to, or procures or aids and abets the commission of any offence under subarticle (1) of this article shall be guilty of an offence and shall be liable to the same penalties as the principal offender.
(3) The Minister shall make regulations under this article prescribing penalties for offences against this Act, and such regulations may prescribe -
(a) penalties which are enforceable by prosecution in the courts of Malta<
(b) different penalties for contraventions of different provisions of this Act<
(c) penalties calculated in accordance with the duration of the commission of the offence,
unless such penalties are otherwise imposed under article 3 of this Act.
A 456

Penalties.

Application of certain articles of the Insurance Business Act to insurance intermediaries.

53. (1) The penalties prescribed by regulations made under 52 of this Act -
(a) in the case of imprisonment, shall not provide for a sentence of imprisonment greater than two years<
(b) in the case of a fine imposed after a prosecution in the courts of Malta, shall not provide for a fine (multa) of less than one hundred Maltese liri or greater than fifty thousand Maltese liri<
(c) in the case of a continuing offence, shall not provide for a fine (multa) of less than fifty Maltese liri or greater than one hundred Maltese liri for each day during which the offence continues.
(2) No proceedings for an offence under this Act or any regulations made thereunder other than an infringement to which paragraph (h) of subarticle (2) of article 3 applies, shall be commenced without the consent of the Attorney General.
(3) The provisions of this Act shall not affect any criminal proceedings that may be competent under any other law.
54. (1) Subject to the provisions of subarticle (2) of this article> (a) the provisions of articles 29 to 31A and of article 38 of
the Insurance Business Act (hereinafter in this article referred to
as the “the Act”) shall apply to an enrolled person, as if reference in such provisions -
(i) to “authorisation” were a reference to “enrolment”
in the Agents List, Managers List or Brokers List”<
(ii) to “an authorised company” were a reference to
“an enrolled person”<
(iii) to “business of insurance” were a reference to
“insurance intermediaries activities”<
(iv) to “a company whose head office is in a country outside Malta” were a reference to “a foreign company”<
(b) articles 29 to 31A of the Act shall apply to a person enrolled in the Tied Insurance Intermediaries List as if reference in such provisions -
(i) to “authorisation” were a reference to “enrolment in the Tied Insurance Intermediaries List”<
(ii) to “an authorised company” were a reference to “a tied insurance intermediary”<
(iii) to “business of insurance” were a reference to “tied insurance intermediaries activities”.
(2) Subarticle (1) of this article shall apply to an enrolled person as if reference in the relevant provisions of the Act to “the competent authority” were a reference to “the competent authority” under this Act, and references to “insurance rules” were references to “insurance intermediaries rules”.
55. (1) Saving the provisions of the following subarticles of this Act, the Insurance Brokers and Other Intermediaries Act is hereby repealed.
(2) Every licence issued or other action whatever taken or commenced under the Insurance Business Act, in so far as insurance agents and insurance managers are concerned, or under the Insurance Brokers and Other Intermediaries Act, shall continue in force and to be valid as if such licence were issued or as if such other action were taken or commenced under this Act.
(3) Any person or company licensed under the Insurance Business Act to act as an insurance agent or as an insurance manager within the meaning of that Act or licensed under the Insurance Brokers and Other Intermediaries Act to act as an insurance broker or insurance sub-agent within the meaning of that latter Act shall, not later than the appointed date, conform with the provisions of this Act or otherwise cease to act as an insurance intermediary, and shall until the appointed date or until it conforms with the provisions of this Act, whichever is earlier, continue to be governed by the provisions of the Insurance Business Act or the Insurance Brokers and Other Intermediaries Act, as the case may be. For the purpose of this subarticle “appointed date” means a day being six months after the date of the coming into force of this Act.
(4) Where a company ceases to act as an insurance agent, insurance manager or insurance broker on the grounds that such company did not, on the appointed date, conform with the provisions of this Act, that company shall be deemed to have made an application to the competent authority under article 26 of this Act on the appointed date to cease to carry on insurance intermediaries activities on that date and
A 457

Repeals andSavings. Cap. 404.

A 458
to have been given permission by the competent authority under that article on the appointed date to cease to carry on such business on that date and to run-off that business as from that date. The competent authority may impose such conditions with regard to the run-off of that business as it may deem proper.
(5) Where a person concerned ceases to act as a registered insurance broker on the grounds that such person did not, on the appointed date, conform with the provisions of this Act –
(a) that person shall be deemed to have made a request to the competent authority under paragraph (e) of article 16 of this Act on the appointed date requesting the competent authority to strike his name off the said register on that date<
(b) the competent authority shall be deemed to have struck the name of that person off the Brokers Register on that date, and, also on that date, notified that person that his name has been struck off the Brokers Register< and the person, following the appointed date, shall forthwith surrender to the competent authority the certificate of registration, and any official copies thereof.
(6) Where a person ceases to act as an insurance sub-agent on the grounds that such person did not, on the appointed date, conform with the provisions of this Act -
(a) that person shall be deemed to have made an application to the authorised company, in whose Tied Insurance Intermediaries Company Register of the company his name is registered, under paragraph (b) of article 39 of this Act, on the appointed date, requesting the company to strike his name off the said register on that date<
(b) the authorised company concerned shall be deemed to have struck the name of that person off the Tied Insurance Intermediaries Register of the company on that date, and, also on that date, notified that person and the competent authority accordingly, under subarticle (6) of article 40 of this Act<
(c) the competent authority shall be deemed to have struck the name of that person off the Tied Insurance Intermediaries List on that date, and, also on that date, notified the company concerned accordingly, under paragraph (a) of subarticle (3) of article 40 of this Act< and the authorised company concerned shall forthwith, following the appointed date, surrender to the competent authority the certificate of enrolment relating to that person and any official copies thereof.
(7) Without prejudice to the provisions of article 12 of the
Interpretation Act -
(a) all regulations, insurance directives, insurance intermediaries directives, orders and other instruments which were kept into force by, or made under, the Insurance Business Act, in so far as insurance agents and insurance managers are concerned, and the Insurance Brokers and Other Intermediaries Act< and
(b) any agreements and arrangements which were made in virtue of the Insurance Business Act, in so far as insurance agents and insurance managers are concerned, and the Insurance Brokers and Other Intermediaries Act, or made in virtue of any regulation, insurance directive, insurance intermediaries directive, order and other instrument,
shall, if and as in force immediately before the commencement of this article, be deemed to have been made under or in virtue of this Act and shall continue in force and may be amended, altered, repealed or otherwise dealt with accordingly.
(8) All references in any enactment and in any instrument or other document issued pursuant to the Insurance Business Act, in so far as insurance agents and insurance managers are concerned, or to the Insurance Brokers and Other Intermediaries Act, or to any provision thereof, shall, in so far as applicable, be read and construed as a reference to this Act or to the corresponding provision thereof.
(9) Any reference to an insurance intermediaries directive issued by the competent authority in virtue of subarticle (3) of article 4 of the Insurance Brokers and Other Intermediaries Act in any licence, notice, decision or other act made or taken by the competent authority before the coming into force of the provisions of this Act, and any reference in any law to an insurance intermediaries directive shall be deemed to be a reference to an insurance intermediaries rule.
(10) For the purpose of this article, “licence” includes authority or authorisation, permit, approval, registration, enrolment and appointment, and the word “licensed” shall be construed accordingly.
A 459

Cap. 249.

A 460

Amends the Malta Financial Services Authority Act, Cap.

330.

Amendment of article 16 of the principal Act.

PART X
AMENDMENT OF THE MALTA FINANCIAL SERVICES AUTHORITY ACT, CAP. 330
56. (1) This Part amends and shall be read and construed as one with the Malta Financial Services Authority Act, hereinafter in this Part referred to as “the principal Act”.
(2) The provisions of this Part shall come into force on such date as the Minister responsible for finance may, by notice in the Gazette, establish.
57. Immediately after sub-article (3) of article 16 of the principal
Act there shall be inserted the following new subarticles>
“(4) The right of the Authority to obtain information from a person who holds or has held a licence or other authorization, or from any of the officials or employees of such person, shall not be restricted, obstructed or precluded in any manner. Any gagging or similar confidentiality obligation or other restrictive condition arising from the legal or contractual relationship between such person and his officials or employees shall be, in so far as it is contrary to these provisions and impedes or restricts the right of the Authority to receive information required in the pursuance of its regulatory functions and duties arising under this or any other Act, null and void.
(5) In furtherance of the provisions of subarticle (4), the following rules shall apply>
(a) any person who holds or has formerly held a license or other authorization from the Authority, and the officials and employees thereof shall, upon a written request by the Authority, promptly provide the Authority with any information that it may require as provided in subarticle (4), and may not raise any contractual gagging restriction or similar prohibition or other confidentiality obligation arising or alleged to arise under contract law or otherwise refuse to comply with such a request of the Authority<
(b) no action for breach of contract and no disciplinary measure may be taken, directly or indirectly, by a person against any of its officials or employees for providing the Authority with any information required by the Authority as
provided in subarticle (4)< and any contractual or disciplinary measure contrary to this provision shall be null and void<
(c) for the purposes of this article>
(i) “information” shall include explanations and other forms of assistance< and
(ii) “employees” and “officials” shall include former employees and officials.”.
PART XI
AMENDMENTS OF THE TRUSTS AND TRUSTEES ACT, CAP. 331.
58. (1) This Part amends and shall be read and construed as one with the Trusts and Trustees Act, hereinafter in this Part referred to as “the principal Act”.
(2) The provisions of this Part shall come into force on such date as the Minister responsible for finance may, by notice in the Gazette, establish and different dates may be so established for different provisions and different purposes thereof.
59. In subarticle (2) of article 12 of the principal Act, for the words “for a charitable purpose or to a unit trust” there shall be substituted the words “for a charitable purpose, to a unit trust or to a retirement scheme registered in terms of the Special Funds (Regulation) Act and set up as a trust”.
60. Article 43 of the principal Act shall be amended as follows> (a) immediately after paragraph (b) of subarticle (6) thereof,
there shall be inserted the following new paragraph (c)>
“(c) A person registered in terms of the Special Funds (Regulation) Act to act as a trustee to retirement schemes shall not require further authorisation in terms of this Act provided that such trustee services are limited to retirement schemes.”<
(b) in paragraph (i) of subarticle (8) thereof, for the words “they are licensed< or” there shall be substituted the words “they are licensed<”<
A 461

Amendments of the Trusts and Trustees Act, Cap. 331

Amendment of article 12 of the principal Act.

Amendment of article 43 of the principal Act.

A 462

Amendment of the Investment Services Act, Cap. 370.

Amendment of article 12 of the principal Act.

Amendment of article 19 of the principal Act.

(c) in paragraph (ii) of subarticle (8) thereof, for the words “approved jurisdiction>” there shall be substituted the words “approved jurisdiction< or”<
(d) immediately after paragraph (ii) of subarticle (8), there shall be inserted the following new paragraph (iii)>
“(iii) a person registered under the Special Funds
(Regulation) Act as a retirement scheme administrator>”< and
(e) in paragraph (a) of subarticle (9), for the words “subarticle (6)(a) and (7)(e), (g) and (h)” there shall be substituted the words “ (6)(a) and (c) and (7)(e), (g) and (h)”.
PART XII
AMENDMENT OF THE INVESTMENT SERVICES ACT, CAP. 370
61. (1) This Part amends and shall be read and construed as one with the Investment Services Act, hereinafter in this Part referred to as “the principal Act”.
(2) The provisions of this Part shall come into force on such date as the Minister responsible for finance may, by notice in the Gazette, establish.
62. In paragraph (b) of subarticle (1) of article 12 of the principal Act, for the words “thereto, providing for any matter he may deem expedient including the creation and exercise of rights by or for the benefit of the public and the imposition of duties and obligations on the holders of a licence or persons responsible for the management or administration thereof<” there shall be substituted the words “thereto< providing for any matter he may deem expedient including the creation and exercise of rights by or for the benefit of the public, the imposition of duties and obligations on the holders of a licence or persons responsible for the management or administration thereof and the regulation of any fees and, or any other charges imposed directly or indirectly on investors<”.
63. Paragraph (h) of subarticle (2) of article 19 thereof shall be deleted.
64. Article 25 of the principal Act shall be amended as follows>
A 463

Amendment of article 25 of the principal Act.

and
(a) subarticles (2), (3), (4) and (5) thereof shall be deleted<
(2).
(b) subarticle (6) thereof shall be re-numbered as subarticle
65. Article 26 of the principal Act shall be substituted by the following>
“26. (1) Information obtained by the competent authority or by its officers, employees or agents for the purposes of, or pursuant to, any of the provisions of this Act, or of any rules or regulations made thereunder, or in the discharge of any functions under any of the said provisions, shall be treated as confidential and protected by the duty of professional secrecy, and shall not be disclosed to any other person, except in the following cases>
(a) where the disclosure is required for the detection, prevention or prosecution of criminal offences under the criminal provisions of this Act or any other Act<
(b) where the information is disclosed with a view to the institution of, or otherwise for the purposes of any proceedings by the competent authority before any court under this Act<
(c) where the information is disclosed in civil or commercial proceedings in relation to the bankruptcy or dissolution and consequential winding up by the Court of a licence holder, provided such information does not concern third parties and is necessary for the carrying out of the proceedings, or is disclosed to an overseas body responsible for the liquidation and bankruptcy of a person holding a licence or an equivalent authorisation from an overseas regulatory authority<
(d) where a summary or collection of the information is prepared or supplied in such a way as not to enable the identity of any persons to whom the information relates to be ascertained<
(e) where the information is disclosed to an auditor where such disclosure would assist him in the exercise of his functions under article 18<

Amendment of article 26 of the principal Act.

A 464

Cap. 345.

Amendment of the Financial Institutions Act, Cap. 376.

Amendment of article 2 of the principal Act.

Amendment of article 3 of the principal Act.

(f) where the information is provided to the Central Bank of Malta or to the Listing Authority under the Financial Markets Act in the exercise of their respective functions in terms of law< and
(g) where the information is provided to such other local or overseas regulatory, judicial or enforcement authorities in the pursuance of serious concerns of a regulatory or criminal nature.
(2) Subject to the provisions of article 17, information obtained from an overseas regulatory authority may only be disclosed to another person, to another overseas regulatory authority or to any other third party with the prior approval of the authority which had provided the information.”.
PART XIII
AMENDMENT OF THE FINANCIAL INSTITUTIONS ACT, CAP. 376
66. (1) This Part amends and shall be read and construed as one with the Financial Institutions Act, hereinafter in this Part referred to as “the principal Act”.
(2) The provisions of this Part shall come into force on such date as the Minister responsible for finance may, by notice in the Gazette, establish.
67. Article 2 of the principal Act shall be amended as follows> (a) in subarticle (1) thereof, for the definition “competent
authority”, there shall be substituted the following new definition>
“ “the competent authority” means the body referred to in article 12(1)<”< and
(b) subarticle (2) thereof shall be repealed and subarticle
(1) thereof shall be renumbered as the whole article 2.
68. Article 3 of the principal Act shall be amended as follows> (a) subarticles (2) and (3) thereof shall be renumbered as
subarticles (3) and (4) respectively< and
(b) immediately after subarticle (1) thereof, there shall be inserted the following new subarticle (2)>
“(2) Subject to the provisions of subarticle (3), a person shall not be deemed to be a financial institution by reason of the fact that the person either>
(a) belongs to a group of companies and provides any of the activities listed in the Schedule to this Act to companies which are not banks or financial institutions and which belong to the same group of companies< or
(b) draws and issues trade bills in the normal course of business under hire purchase agreements, or under sales on credit where trade bills are drawn in respect of the price due.”.
69. For sub-article (3) of article 9 of the principal Act, there shall be substituted the following>
“(3) Subarticle (1) shall apply whether or not any of the relevant shares are shares listed on a recognised investment exchange in terms of the Financial Markets Act.”.
70. For paragraph (a) of article 21 of the principal Act there shall be substituted the following>
“ (a) under article 3(3)<”.
PART XIV
AMENDMENT OF THE COMPANIES ACT, CAP. 386
71. (1) This Part amends and shall be read and construed as one with the Companies Act, hereinafter in this Part referred to as “the principal Act”.
(2) The provisions of this Part shall come into force on such date as the Minister responsible for finance may, by notice in the Gazette, establish.
72. In the second part of the “ARRANGEMENT OF ACT”
appearing before the principal Act, entitled “SCHEDULES”, for the
A 465

Amendment of article 9 of the principal Act.

Amendment of article 21 of the principal Act.

Amendment of the Companies Act, Cap. 386.

Amendment of “Arrangement of Act”.

A 466

Amendment of article 428 of the principal Act.

Amendment of the Tenth Schedule to the principal Act.

words from “Tenth Schedule” to the words “Table of Concordance”, there shall be substituted the following>
“Tenth Schedule Partnerships ‘en commandite’ or limited partnerships
Eleventh Schedule Penalties
Twelfth Schedule Table of Concordance”.
73. In sub-article 15 of article 428 of the principal Act, for the words “ – in the case of a company, any resolution, notice or return required to be delivered to the Registrar in terms of the provisions of Title II of Part V and of articles 122, 146, 183 and 184< and”, there shall be substituted the words “- in the case of a company, any resolution, notice or return required to be registered under this Act, other than any resolution , notice, return or other document required to be delivered to the Registrar in terms of the provisions of Title II of Part V and of articles 122, 146, 183 and 184 of this Act< and”.
74. Paragraph 25 of the Tenth Schedule to the principal Act shall be amended as follows>
(a) in indent (m) of sub-paragraph (8) thereof, for the words “and in the event that such assets are insufficient to discharge the liabilities so incurred, the creditors in respect thereof shall have no claim or right of action against the other assets of the partnership, and the provisions of any law or regulation in force regulating the insolvency of partnerships shall not apply.”, there shall be substituted the words “and the creditors in respect thereof shall have no claim or right of action against the other assets of the partnership, and the following rules shall apply>
(i) proceedings in relation to the partnership shall respect the legal status of each sub-class as a patrimony separate from the assets and liabilities of each other sub-class of the partnership in terms of this Schedule< and
(ii) proceedings under the Act shall apply mutatis mutandis to the sub-class as though it were a distinct legal entity and with such modifications as are necessary to accommodate the fact that the sub-class is not a partnership< and any proceedings in relation to one sub-class shall not have any effect on the assets of any other sub-class of the partnership or the partnership itself.
“Proceedings” in indent (m) of this sub-paragraph refers to any proceedings in terms of paragraphs 20 to 24 of this Schedule and Part VI of the Act.”< and
(b) sub-paragraphs (n), (o) and (p) of sub-paragraph (8) thereof shall be renumbered as sub-paragraphs (o), (p) and (q) respectively, and immediately after sub-paragraph (m) thereof, there shall be inserted the following new sub-paragraph (n)>
“(n) When a partnership en commandite or a limited partnership is established as an umbrella or multi-class partnership and elects to have the assets and liabilities of its sub-classes treated as distinct patrimonies, the memorandum shall provide that the actual value of the paid up share capital of any sub-class shall be at all times equal to the value of the assets of any kind of the particular sub-class after the deduction of such sub-classes’ liabilities and this in lieu of what is stated in paragraph (i) of sub-paragraph (c) of sub-article (2) of article
84 of the Act.”.
PART XV
AMENDMENT OF THE INSURANCE BUSINESS ACT, CAP. 403
75. (1) This Part amends the Insurance Business Act and shall be read and construed as one with the Insurance Business Act, hereinafter in this Part referred to as “the principal Act”.
(2) The provisions of this Part shall come into force on such date as the Minister responsible for finance, may by notice in the Gazette establish, and different dates may be so established for different provisions or different purposes of this Part.
76. Article 2 of the principal Act shall be amended as follows> (a) in the marginal note thereof, for the word “Interpretation”
there shall be substituted the words “Interpretation and scope”.
(b) in subarticle (1) thereof>
A 467

Amendment of the Insurance Business Act, Cap. 403.

Amendment of article 2 of the principal Act.

A 468

Cap. 386.

(i) immediately after the definition “business of insurance” there shall be added the following new definition>
“ “cell” has the same meaning as is assigned to it by the Companies Act<”<
(ii) immediately after the definition “cell”, there shall be added the following new definition>
“ “cell company” has the same meaning as is assigned to it by the Companies Act<”<
(iii) for the definition of “company whose head office is in a country outside Malta” there shall be substituted the following>
“ “company whose head office is in a country outside Malta” means a company, other than a European insurance undertaking, registered, incorporated or constituted outside Malta under the laws of any country provided that such company has complied with the provisions of any law which may from time to time be in force in Malta relating thereto<”<
(iv) in the definition “competent authority”, for the words “established under article 3(2)”, there shall be substituted the words “established under article 3”<
(v) immediately after the definition “director” there shall be added the following new definition>
“EEA State” means a State which is a contracting party to the agreement on the European Economic Area signed at Oporto on 2 May, 1992 as amended by the Protocol signed at Brussels on the 17th March, 1993 and as amended from time to time<
(vi) immediately after the definition “establishment”
there shall be added the following new definition>
“ “European insurance undertaking” means an undertaking having its head office in a Member State or an EEA State other than Malta, pursuing the activity of direct insurance within the meaning of article 1 of First Council Directive 73#239#EEC of 24 July 1973 on the coordination of laws, Regulations and administrative
provisions relating to the taking-up and pursuit of direct insurance other than life assurance or article 2 of Directive 2002#83#EC of the European Parliament and of the Council of 5 November 2002 concerning life assurance, which has received authorisation under article
6 and article 4 of the said Directives respectively<”<
(vii) for the definition “insurance agent”, there shall be substituted the following>
“ “insurance agent” has the same meaning as is assigned to it by the Insurance Intermediaries Act,
2006<”<
(viii) the definition of “insurance directive” shall be deleted<
(ix) for the definition “insurance manager”, there shall be substituted the following>
“ “insurance manager” has the same meaning as is assigned to it by the Insurance Intermediaries Act,
2006<”<
(x) immediately after the definition of “insurance manager” there shall be added the following new definition>
“ “insurance rule” means a rule in respect of the business of insurance which shall be binding on authorised companies and others as may be specified therein, issued by the competent authority in virtue of article 4(3) of this Act<”<
(xi) for the definition of “Malta’s international commitments” there shall be substituted the following>
“ “Malta’s international commitments” means Malta’s commitments, responsibilities and obligations arising out of its membership of, or accession to the European Union, or membership of, or affiliation to, or relationship with, any international, global or regional organisations or grouping of countries or out of any treaty, convention or other international agreement, however called, whether bilateral or multilateral, to which Malta is a party<”<
A 469
A 470
(xii) immediately after the definition “margin of solvency” there shall be added the following new definition>
“ “Member State” means a Member State of the
European Communities<
(xiii) in the definition “own funds”, for the words “in accordance with an insurance directive”, there shall be substituted the words “in accordance with an insurance rule”<
(xiv) in the definition “prescribed”, for the words “prescribed by rules or regulations”, there shall be substituted the words “prescribed by regulations”<
(xv) the definition of “recognised insurance body”
shall be deleted<
(xvi) immediately after the definition of “reconstruction” there shall be added the following new definition>
“reinsurance” means the activity consisting in accepting risks ceded by an insurance undertaking or by another reinsurance undertaking<
(xvii) in the definition “risk situated in Malta”, in paragraph (b) thereof, there shall be added the following proviso>
“Provided that, where a vehicle is dispatched from a Member State or an EEA State into Malta, the risk is deemed to be situated in Malta, immediately upon acceptance of delivery by the purchaser for a period of thirty days, even though the vehicle has not been formally registered in Malta<”< and
(xviii) in the definition “technical provisions”, for the words “in accordance with article 17(1) to (6)”, there shall be substituted “in accordance with article 17(1) to (5)”<
(c) subarticle (2) thereof shall be substituted by the following>

“Scope.

(2) The objective of this Act is, in part, to implement the provisions of>
(a) First Council Directive of 24 July 1973 on the coordination of laws, Regulations and administrative provisions relating to the taking-up and pursuit of direct insurance other than life assurance (73#239#EEC)<
(b) Second Council Directive of 22 June 1988 on the coordination of laws, regulations and administrative provisions relating to direct insurance other than life assurance and laying down provisions to facilitate the effective exercise of freedom to provide services and amending Directive 73#239#EEC (88#357#EEC)<
(c) Council Directive 92#49#EEC of 18 June 1992 on the coordination of laws, regulations and administrative provisions relating to direct insurance other than life assurance and amending Directives
73#239#EEC and 88#357#EEC (third non-life insurance
Directive)<
(d) Directive 2002#12#EC of the European Parliament and of the Council of 5 March 2002 amending Council Directive 79#267#EEC as regards the solvency margin requirements for life assurance undertakings<
(e) Directive 2002#13#EC of the European Parliament and of the Council of 5 March 2002 amending Council Directive 73#239#EEC as regards the solvency margin requirements for non-life insurance undertakings<
(f) Directive 2002#83#EC of the European Parliament and of the Council of 5 November 2002 concerning life assurance<
(g) Directive 2005#14#EC of the European Parliament and of the Council of 11 May 2005 amending Council Directives 72#166#EEC, 84#5#EEC, 88#357#EEC and 90#232#EEC and Directive 2000#26#EC of the European Parliament and of the Council relating to insurance against civil liability in respect of the use of motor vehicles<
(h) Directive 2005#68#EC of the European Parliament and of the Council of 16 November 2005 on reinsurance and amending Council Directives
73#239#EEC, 92#49#EEC as well as Directives 98#78#EC
and 2002#83#EC< and
A 471
A 472

Substitution of article 3 of the principal Act.

(i) any other Directive of the European Parliament and of the Council that may be issued from time to time relating to the regulation of and the prudential requirements applicable to insurance companies,
which shall be interpreted and applied accordingly.”< and
(d) in subarticle (3) thereof, for the words “in any rules or regulations made thereunder,”, there shall be substituted the words “in any regulations made thereunder,”.
77. For article 3 of the principal Act, there shall be substituted the following>

“Competent authority.

3. The Minister shall by Order in the Gazette appoint a body to be the competent authority for the purposes of this Act to carry out the functions of the competent authority under this Act and, in particular, to ensure compliance with the provisions of this Act.”.

Amendment of article 4 of the principal Act.

78. Article 4 of the principal Act shall be amended as follows> (a) in subarticle (1) thereof>
(i) for the words “any rules or regulations made thereunder” wherever they appear, there shall be substituted the words “any regulations made thereunder”< and
(ii) for the words “with any insurance directive made by the competent authority”, there shall be substituted the words “with any insurance rule made by the competent authority”<
(b) in subarticle (3) thereof>
(i) for the words “insurance directives” wherever they appear, there shall be substituted the words “insurance rules”< and
(ii) for the words “any rules or regulations made thereunder.”, there shall be substituted the words “any regulations made thereunder.”<
(c) in subarticle (4) thereof, for the words “Insurance directives”, there shall be substituted the words “Insurance rules”< and
(d) in subarticle (5) thereof, for the words “Insurance directives”, there shall be substituted the words “Insurance rules”.
79. Article 5 of the principal Act shall be amended as follows> (a) in subarticle (6) thereof, for the words “make rules or
regulations”, there shall be substituted the words “make
regulations”<
(b) in subarticle (7) thereof, for the words “by an insurance directive”, there shall be substituted the words “by an insurance rule”< and
(c) in subarticle (8) thereof, for the words “by an insurance directive” or “the directive”, there shall be substituted the words “by an insurance rule” or “the rule” respectively.
80. Article 6 of the principal Act shall be amended as follows> (a) for subarticle (3) thereof, there shall be substituted the
following>
“(3) Subarticles (1) and (2) shall not apply to>
(a) a mutual association if such mutual association satisfies such requirements as may be set out in an insurance rule made for the purpose< or
(b) a European insurance undertaking having its head office in a Member State or an EEA State establishing a branch or providing services in Malta in exercise of a European right.”< and
(b) subarticle (4) thereof, shall be deleted< and
(c) subarticles (5) and (6) thereof, shall be renumbered as subarticles (4) and (5) respectively.
81. Article 8 of the principal Act shall be amended as follows> (a) in subarticle (1) thereof>
(i) for paragraph (b) thereof, there shall be substituted the following>
A 473

Amendment of article 5 of the principal Act.

Amendment of article 6 of the principal Act.

Amendment of article 8 of the principal Act.

A 474

Amendment of article 9 of the principal Act.

Amendment of article 10 of the principal Act.

(b) (i) in so far as a company whose business is not restricted to reinsurance business, the company’s objects are limited to business of insurance and operations arising directly therefrom, to the exclusion of all other commercial business<
(ii) in so far as a company carrying on business restricted to reinsurance, the company’s objects are limited to the business of reinsurance and related operations, as may be specified by an insurance rule made for the purposes of this article<
(ii) in paragraph (e) thereof, for the words “as may be determined by an insurance directive”, there shall be substituted the words “as may be determined by an insurance rule”< and
(iii) in paragraph (f) thereof, for the words “as may be determined by an insurance directive”, there shall be substituted the words “as may be determined by an insurance rule”< and
(b) in subarticle (3) thereof, for the words “an insurance directive issued under this Act”, there shall be substituted the words “an insurance rule issued under this Act”.
82. Article 9 of the principal Act shall be amended as follows> (a) for subarticle (2) thereof, there shall be substituted the
following>
“(2) Without prejudice to the provisions of subarticle (3), the provisions of this article shall not apply to a company which holds an authorisation to carry on both long term business and general business under this Act as is force immediately before the coming into force of subarticle (1) until such time as the Minister may by Order in the Gazette establish.”< and
(b) in subarticle (3) thereof, for the words “as may be determined by an insurance directive”, there shall be substituted the words “as may be determined by an insurance rule”.
83. In paragraph (b) of subarticle (1) of article 10 of the principal Act, the words “where the authorisation sought or held is one not restricted to reinsurance,” shall be deleted.
84. In indent (ii) of paragraph (b) of subarticle (2) of article 11 of the principal Act, for the words “determined by an insurance directive”, there shall be substituted the words “determined by an insurance rule”.
85. Article 13 of the principal Act shall be deleted.
86. Article 14 of the principal Act shall be amended as follows> (a) in subarticle (2) thereof, the words “Subject to subarticle
(3)” shall be deleted<
(b) subarticle (3) thereof, shall be deleted<
(c) subarticles (4), (5), (6) and (7) thereof, shall be renumbered as subarticles (3), (4), (5) and (6) respectively<
(d) in subarticle (5) thereof as renumbered, for the words “the reference in subarticle (5)(a)”, there shall be substituted the words “the reference in subarticle (4)(a)”< and
(e) in subarticle (6) thereof as renumbered>
(i) for the words “In applying subarticle (5)”, there shall be substituted the words “In applying subarticle (4)”< and
(ii) for the words “maintained under article 17(7)”, there shall be substituted the words “maintained under article
17(6)”.
87. Article 15 of the principal Act shall be amended as follows> (a) for the marginal note to article 15 thereof, there shall be
substituted the words “Failure to maintain the minimum margin of solvency.”< and
(b) in subarticle (3) thereof, for the words “by virtue of article
14(6)” there shall be substituted the words “by virtue of article
14(5)”.
88. Article 16 of the principal Act shall be amended as follows> (a) in subarticle (1) thereof, the words “Subject to subarticle
(5)” shall be deleted< and
A 475

Amendment of article 11 of the principal Act.

Deletion of article

13 of the principal

Act.

Amendment of article 14 of the principal Act.

Amendment of the marginal note to article 15 of the principal Act.

Amendment of article 16 of the principal Act.

A 476

Amendment of article 17 of the principal Act.

Amendment of article 20 of the principal Act.

Amendment of article 21 of the principal Act.

Amendment of article 23 of the principal Act.

Amendment of article 26 of the principal Act.

(b) subarticle (5) thereof shall be deleted.
89. Article 17 of the principal Act shall be amended as follows> (a) subarticle (6) thereof shall be deleted<
(b) subarticles (7), (8) and (9) thereof, shall be renumbered as subarticles (6), (7) and (8) respectively<
(c) in subarticle (6) thereof as renumbered, for the words “Without prejudice to subarticle (1) and subject to subarticle (8)”, there shall be substituted the words “Without prejudice to the foregoing subarticles and subject to subarticle (7)”< and
(d) in subarticle (7) thereof as renumbered, for the words “Subarticle (7) shall not apply to such company”, there shall be substituted the words “Subarticle (6) shall not apply to such company”.
90. Subarticle (4) of article 20 of the principal Act shall be deleted.
91. Subarticle (3) of article 21 of the principal Act shall be amended as follows>
(a) for the words “and of any rules or regulations”, there shall be substituted the words “and of any regulations”< and
(b) for the words “and of any insurance directive”, there shall be substituted the words “and of any insurance rule”.
92. Article 23 of the principal Act shall be amended as follows> (a) in subarticle (4) thereof, for the words “as may be determined by an insurance directive”, there shall be substituted
the words “as may be determined by an insurance rule”< and
(b) in subarticle (6) thereof, for the words “by the insurance directive determine.”, there shall be substituted the words “by the insurance rule determine.”.
93. Article 26 of the principal Act shall be amended as follows> (a) in paragraph (a) thereof>
(i) for the words “and any rules or regulations made thereunder”, there shall be substituted the words “and any regulations made thereunder”< and
(ii) for the words “or any insurance directive<”, there shall be substituted the words “or any insurance rule<”< and
(b) in paragraph (d) thereof>
(i) for the words “and any rules or regulations made thereunder,”, there shall be substituted the words “and any regulations made thereunder,”< and
(ii) for the words “or any insurance directive,”, there shall be substituted the words “or any insurance rule,”.
94. Subarticle (1) of article 28 of the principal Act shall be amended as follows>
(a) for the words “In any of the cases in which the competent authority may suspend or revoke an authorisation under article 26, the competent authority may, either in lieu of or in addition to any such suspension or revocation, and without prejudice to its powers to suspend or revoke an authorisation, proceed in any one or more of the following manners>” there shall be substituted the words “Without prejudice to the powers conferred to the competent authority under article 26 of the Act, the competent authority, may, where it is satisfied that sufficient serious circumstances exist, proceed to take any one or more of the following measures>”<
(b) paragraph (e) shall be substituted by the following> “(e) issue an order for the dissolution and winding up
of the company or, in the case of a company whose head
office is in a country outside Malta, for the winding up of its business in Malta<”< and
(c) for paragraph (h) there shall be substituted the following> “ (h) require the company to submit a financial recovery
plan as may be determined by an insurance rule made for the purposes of this article if it considers that the interest of insureds, policyholders, creditors or other interested persons
A 477

Amendment of article 28 of the principal Act.

A 478

Amendment of article 30 of the principal Act.

Addition of new article 31A in the principal Act.

are likely to be prejudiced owing to a deterioration in the financial position of the company< ”.
95. For subarticle (7) of article 30 of the principal Act, there shall be substituted the following>
“ (7) In this article, any reference to officers or to agents shall include a reference to past as well as present officers or agents and the expression “agents”, in relation to an authorised company, shall include an insurance agent, insurance manager or tied insurance intermediary, registered or enrolled under the Insurance Intermediaries Act, 2006 acting for the company, the bankers, the auditors and, in the case of a company authorised to carry on long term business, the actuary of the company, a person acting as an intermediary for the company and a person as may be prescribed by regulations made for the purposes of article 18.”.
96. Immediately after article 31 of the principal Act, there shall be inserted the following new article 31A>

“Power to issue directives.

31A. (1) Without prejudice to any of the powers conferred to it under this Act, the competent authority may, whenever it deems it necessary, give, by notice in writing, such directives as it may deem appropriate in the circumstances, and any person to whom or to which the notice is given shall obey, comply with and otherwise give effect to any such directive within the time and in the manner stated in the directive.
(2) The power to give directives under this article shall include the power to vary, alter, add to or withdraw any directive, as well as the power to issue new or further directives.
(3) Where the competent authority is satisfied that the circumstances so warrant, it may at any time make public any directive it has given under any of the provisions of this article.”.

Amendment of article 32 of the principal Act.

97. Article 32 of the principal Act shall be amended as follows>
(a) in subarticle (1) thereof, for the words “an insurance directive” or “that directive.”, there shall be substituted the words “an insurance rule” or “that rule.”, respectively<
(b) in subarticle (2) thereof, for the words “the insurance directive.”, there shall be substituted the words “the insurance rule.”< and
(c) in subarticle (3) thereof, for the words “specified in the directive.”, there shall be substituted the words “specified in the rule.”.
98. Article 37 of the principal Act shall be deleted.
99. Article 38 of the principal Act shall be amended as follows> (a) in subarticle (2) thereof, for the words “insurance
undertaking,” there shall be substituted the words “insurance undertaking, reinsurance undertaking,” < and
(b) in subarticle (7) thereof, for the words “an insurance directive determining the form in which such notification shall take place”, there shall be substituted the words “an insurance rule determining the form in which such notification shall take place”.
100. Article 39 of the principal Act shall be amended as follows> (a) in subarticle (2) thereof>
(i) in indent (i) of paragraph (a) therein, for the words “as may be determined by an insurance directive”, there shall be substituted the words “as may be determined by an insurance rule”< and
(ii) in indent (ii) of paragraph (b) therein, for the words “by any applicable insurance directive.”, there shall be substituted the words “by any applicable insurance rule.”< (b) subarticle (3) thereof shall be deleted< and
A 479

Deletion of article

37 of the principal

Act.

Amendment of article 38 of the principal Act.

Amendment of article 39 of the principal Act.

(3).
(c) subarticle (4) thereof shall be renumbered as subarticle
101. Article 43 of the principal Act shall be amended as follows> (a) in subarticle (1) thereof>
(i) for the words “and any rules or regulations made thereunder,”, there shall be substituted the words “and any regulations made thereunder,”< and

Amendment of article 43 of the principal Act.

A 480

Amendment of article 44 of the principal Act.

Substitution of article 46 of the principal Act.

(ii) for the words “or any insurance directive,” there shall be substituted the words “or any insurance rule,”< and
(b) in paragraph (b) of article (2) thereof, for the words “an insurance directive” or “that directive.”, there shall be substituted the words “an insurance rule” or “that rule.”, respectively.
102. In subarticle (1) of article 44 of the principal Act, the words “other than a contract falling within class III of the Second Schedule,” shall be deleted.
103. Article 46 of the principal Act shall be substituted by the following>

“Contracts of insurance not voidable by insurer notwith- standing a

46. No contract of insurance shall be held void or voidable by an insurer by reason only that, at the time the contract is entered into, there is a breach of any provision of this Act or of the Insurance Intermediaries Act, (in this article

breach of this referred to as “the Act”) and of any regulations made under

Insurance

this Act or under the Act or of any insurance rule issued in

Intermediaries virtue of this Act or any insurance intermediaries rule issued

in virtue of the Act.”.

Amendment of article 47 of the principal Act.

Amendment of article 48 of the principal Act.

Addition of new article 48A to the principal Act.

104. Article 47 of the principal Act shall be amended as follows>
(a) in subarticle (1) thereof, for the words “by an insurance directive” there shall be substituted the words “by an insurance rule”< and
(b) in subarticle (2) thereof, for the words “insurance directive,”, there shall be substituted the words “insurance rule,”.
105. In subarticle (2) of article 48 of the principal Act, for the words “by an insurance directive” there shall be substituted the words “by an insurance rule”.
106. Immediately after article 48 of the principal Act there shall be added the following new article 48A>

“Provisions relating to Lloyd’s.

48A. (1) For the purposes of the article>
(a) “Lloyd’s” means the society and corporation incorporated by Lloyd’s Act, 1871, of the United Kingdom, and regulated by or under Lloyd’s Acts, 1871

Cap. 12.

to 1982, of the United Kingdom or any other law from time to time amending or re-enacting the same<
(b) “syndicate” means a member or group of members of Lloyd’s underwriting business of insurance at Lloyd’s through the agency of a managing agent to which a particular syndicate number is assigned by or under the authority of the Council of Lloyd’s.
(2) Lloyd’s shall at all times have a representative in Malta who shall be resident in Malta and who shall be the representative in Malta of Lloyd’s and of each of its members. The representative shall be designated by a letter addressed to the competent authority by the chairman of Lloyd’s.
(3) The representative shall for the purposes of this Act be authorised to act generally as judicial representative of, and accept service of any document on behalf of, Lloyd’s and of each of its members and to file any judicial acts in the registry of any court or similar authority in Malta on behalf of Lloyd’s or any of its members. The general representative shall not be personally liable for the debts and obligations of Lloyd’s or any of its members.
(4) It shall be sufficient in any judicial act (other than an application for the issue of any precautionary or executive warrant) filed by or against members of Lloyd’s in connection with a policy underwritten by them to file the act in the name of the Lloyd’s representative in Malta as representative of those members< provided the act contains a statement that it is being filed in connection with a policy of insurance underwritten by members of Lloyd’s and giving particulars of the number reference and date of the policy in respect of which the act is filed, the identifying number of each of the syndicates subscribing thereto and, where known, the names of the members of Lloyd’s comprising those syndicates. This subarticle shall apply notwithstanding any provision to the contrary contained in the Code of Organisation and Civil Procedure.
(5) The Lloyd’s representative shall within forty- five days after the filing by him of the judicial act, or of its service on him, as the case may be, file a note in the records of the judicial act filed as aforesaid containing a list of the names of the members comprising the syndicates subscribing to the policy and any such note shall be deemed to be an
A 481
A 482

Addition of new article 48B to the principal Act.

integral part of the judgment or decree emanating from the court subsequent to the judicial act and such judgment or decree shall be binding on the members whose names are listed in the note in the same manner as it would so have bound them if they has been named as parties to the said judicial act>
Provided that, the Lloyd’s representatives shall not be bound to file any such note following the filing of any judicial act where particulars of the names of the members of Lloyd’s comprising those syndicates are already contained in the act or where any such note has already been filed in the records of the case.”.
107. Immediately after the new article 48A of the principal Act, there shall be added the following new article 48B>

“Appointment of insurance

48B. Every authorised company shall utilise the

intermediaries. services of insurance intermediaries which are>

(a) enrolled under the Insurance Intermediaries
Act, 2006< or
(b) registered with a supervisory authority of a European insurance undertaking in a Member State or an EEA State.

Amendment of article 49 of the principal Act.

Amendment of article 50 of the principal Act.

Substitution of article 54 of the principal Act.

108. In paragraph (a) of article 49 of the principal Act, for the words “in respect of risks situated in Malta and of commitments where Malta is the country of the commitment” there shall be substituted the words “in respect of risks and of commitments”.
109. In subarticle (1) of article 50 of the principal Act, for the words “and any rules and regulations made thereunder,” there shall be substituted the words “and any regulations made thereunder,”.
110. Article 54 of the principal Act shall be substituted by the following>

“Power to issue regulations under this Part of the Act.

54. The Minister may, after consultation with the competent authority, make regulations to better implement the provisions of this Part, including the transposition of any requirement or provision as may arise under a Directive, Regulation or Decision of the European Union or any other similar measure.”.
111. Subarticles (2) and (3) of article 59 of the principal Act shall be amended as follows>
(a) for subarticle (2) thereof, there shall be substituted the following>
“(2) Information obtained by the competent authority or by its officers, employees or agents for the purposes of, or pursuant to, any of the provisions of this Act, or of any regulations made thereunder, or of any insurance rule, or in the discharge of any functions under any of the said provisions, shall be treated as confidential and protected by the duty of professional secrecy, and shall not be disclosed to any other person, except in the following cases –
(a) where the information is disclosed with a view to the institution of, or otherwise for the purposes of, criminal proceedings or of any proceedings by the competent authority before any court under this Act<
(b) where the information is disclosed with a view to enabling or assisting the competent authority in the performance or discharge of any of its functions under this Act<
(c) where the information has been made available to the public by virtue of being disclosed in any circumstances in which, or for any purpose for which, disclosure is not precluded by this article<
(d) where a summary or collection of information is prepared or supplied in such a way as not to enable the identity of any person to whom the information relates to be ascertained<
(e) where the information is disclosed to an auditor where such disclosure would assist the auditor in the exercise of his functions under articles 21 and 24<
(f) where the information is disclosed to an actuary where such disclosure would assist the actuary in the exercise of his functions under article 23<
(g) where the information is provided to the Central
Bank of Malta or to the Listing Authority under the
A 483

Amendment of article 59 of the principal Act.

A 484

Cap. 345

Financial Markets Act in the exercise of their respective functions in terms of law<
(h) where the information is provided to such other local or overseas regulatory, judicial or enforcement authorities where such disclosure is required or requested for the pursuance of serious regulatory concerns or the detection, prevention or prosecution of criminal offences<
(i) where the information is disclosed in civil or commercial proceedings in relation to the bankruptcy or compulsory winding up of an authorised company provided such information does not concern third parties involved in attempts to rescue such company, and to such overseas bodies responsible for the liquidation and bankruptcy of a person holding an authorisation or an equivalent licence from an overseas regulatory authority.” <
(b) for subarticle (3) thereof, there shall be substituted the following>
“ (3) Subject to the provisions of article 55, information obtained from an overseas regulatory authority may only be disclosed to another person, to another overseas regulatory authority or to any other third party with the prior approval of the authority which had provided the information.” .

Amendment of article 61 of the principal Act.

Amendment of article 62 of the principal Act.

112. Article 61 of the principal Act shall be amended as follows>
(a) for the words “or any rules or regulations made thereunder”, there shall be substituted the words “or any regulations made thereunder”< and
(b) in paragraph (e) thereof, for the words “or paragraph
4.1 of the First Schedule, as the case may be<”, there shall be substituted the words “or subarticle (2) of article 48A of the Act, as the case may be<”.
113. Paragraph (a) of subarticle (3) of article 62 of the principal
Act shall be substituted by the following>
“(3) (a) The provisions of the foregoing subarticles shall also apply, mutatis mutandis to companies enrolled to act as insurance managers and companies enrolled to carry on the business of insurance broking under the Insurance Intermediaries Act, 2006,
and accordingly references in this article to “authorised” and to “business of insurance” shall be deemed to include references to “enrolled” and “activities of companies enrolled as insurance managers and business of insurance broking”, respectively.”.
114. Article 64 of the principal Act shall be amended as follows> (a) in subarticle (1) thereof,
(i) for the words “rules and regulations” , wherever they appear, there shall be substituted the word “regulations”< and
(ii) in the Maltese text, in paragraph (c) therein, for the words “ma[luqa minn kumpannija /ellula” there shall be substituted the words “ma[luqa minn kumpannija /ellulari”<
(b) in subarticle (2) thereof, for the words “and not exceeding five thousand liri” there shall be substituted the words “and not exceeding forty thousand liri” <
(c) subarticles (4), (5), (6) and (7) thereof, shall be renumbered as subarticles (6), (9), (10) and (11) respectively<
(d) immediately after subarticle (3) thereof, there shall be added the following new subarticles (4) and (5)>
“(4) The Minister may, after consultation with the competent authority, make regulations providing for the determination and regulation of any matter which relates to finite reinsurance activities, including mandatory conditions for inclusion in all finite reinsurance contracts, and prescribing the accounting, prudential and statistical information requirements providing for the establishment of technical provisions, the margin of solvency and the minimum guarantee fund requirements that a reinsurance undertaking shall maintain in respect of finite reinsurance activities.
(5) The Minister may, after consultation with the competent authority, make regulations providing for the establishment of special purpose vehicles within the meaning of Directive 2005#68#EC of the European Parliament and of the Council of 16 November 2005 on reinsurance and amending Council Directives 73#239#EEC, 92#49#EEC, as well as Directives 98#78#EC and 2002#83#EC, including the conditions under which the activities of such vehicles shall be carried on.” <
A 485

Amendment of article 64 of the principal Act.

A 486

Amendment of article 66 of the principal Act.

Amendment of article 67 of the principal Act.

(e) in subarticle (6) thereof as renumbered, for the words “or of any rules and regulations” there shall be substituted the words “or of any regulations”<
(f) immediately after subarticle (6) thereof as renumbered, there shall be added the following new subarticles>
“ (7) The Minister may, after consultation with the competent authority, make regulations to better implement the provisions of this Act, including the transposition of any requirement or provision as may arise under a Directive, Regulation or Decision of the European Union or any other similar measure relevant for the purposes of this Act.
(8) Regulations may be made under this article with regards to any matter related to a transfer of business of insurance< and the regulations may make such exemptions, conditions, modifications as may be specified therein in respect of different circumstances or purposes.”<
(g) in subarticle (9) thereof as renumbered, for the words “rules or regulations”, wherever they appear, there shall be substituted the word “regulations”< and
(h) in subarticle (11) thereof as renumbered, for the words “rules or regulations”, whenever they appear, there shall be substituted the word “regulations”.
115. In article 66 of the principal Act, for the words “or any rules and regulations” there shall be substituted the words “or any regulations”.
116. Article 67 of the principal Act shall be amended as follows> (a) in subarticle (2) thereof,
(i) in paragraph (a) thereof, for the words “or any rules or regulations made thereunder,”, there shall be substituted the words “or any regulations made thereunder,”<
(ii) in paragraph (b) thereof, for the words “or any rules or regulations made thereunder or any insurance directive< or”, there shall be substituted the words “or any regulations made thereunder or any insurance rule< or”<
(iii) in paragraph (c) thereof, for the words “or any rules or regulations made thereunder< or”, there shall be substituted the words “or any regulations made thereunder< or”<
(iv) in paragraph (d) thereof, for the words “or any rules or regulations made thereunder or any insurance directive< or”, there shall be substituted the words “or any regulations made thereunder or any insurance rule< or”<
(v) in indent (i) of paragraph (e) thereof>
(aa) for the words “or of any rules or regulations made thereunder,” there shall be substituted the words “or of any regulations made thereunder,”< and
(bb) for the words “or any insurance directive< or”, there shall be substituted the words “or any insurance rule< or”<
(b) in the proviso to subarticle (6) thereof, for the words “may not be greater than a financial penalty of five thousand liri” there shall be substituted the words “may not be greater than a financial penalty of forty thousand liri”.
117. Article 68 of the principal Act shall be amended as follows> (a) in subarticle (1) thereof, for the words “and any rules or
regulations made thereunder”, there shall be substituted the words
“and any regulations made thereunder”< and
(b) in subarticle (2) thereof, for the words “and any rules or regulations made thereunder”, there shall be substituted the words “and any regulations made thereunder”<
118. Article 69 of the principal Act shall be amended as follows> (a) subarticles (8) and (9) thereof shall be renumbered as
(9) and (10) respectively< and
(b) immediately after subarticle (7) thereof, there shall be added the following new subarticle>
“(8) Any reference to an insurance directive issued by the competent authority in virtue of subarticle (3) of article 4 of this Act in any licence, notice, decision or other act made
A 487

Amendment of article 68 of the principal Act.

Amendment of article 69 to the principal Act.

A 488

Deletion of the First Schedule to the principal Act.

Amendment of the Second Schedule to the principal Act.

or taken by the competent authority and any reference in any law or regulation to an insurance directive shall be deemed to be a reference to an insurance rule.”.
119. The First Schedule to the principal Act shall be deleted.
120. The Second Schedule to the principal Act shall be amended as follows>
(a) in paragraph 1 thereof, for the words “insurance directive”, there shall be substituted the words “insurance rule”<
(b) in paragraph 2 thereof>
(i) in class II, “Marriage and birth”, under the heading
“Description”>
(aa) for the words “as may be specified by the insurance directive,”, there shall be substituted the words “as may be specified by the insurance rule.”< and
(bb) the words “but excluding (in each case) contracts within class III of this Schedule.” shall be deleted<
(ii) in class III, “Linked long term”, under the heading “Description” the words “or contracts to provide a sum on marriage or on the birth of a child” shall be deleted<
(iii) in sub-paragraph (a) of class IV, “Permanent health”, under the heading “Description” for the words “as may be specified by the insurance directive,”, there shall be substituted the words “as may be specified by the insurance rule,”<
(iv) in class VIII, “Collective insurance”, under the heading “Description” for the words “as may be specified by the insurance directive”, there shall be substituted the words “as may be specified by the insurance rule”< and
(v) in class IX, “Social insurance”, under the heading “Description” for the words “as may be specified by the insurance directive”, there shall be substituted the words “as may be specified by the insurance rule”.
121. The Fourth Schedule to the principal Act shall be deleted.
PART XVI
AMENDMENT OF THE SPECIAL FUNDS (REGULATION) ACT, CAP. 450
122. (1) This Part amends and shall be read and construed as one with the Special Funds (Regulation) Act, hereinafter referred to as “the principal Act”.
(2) The provisions of this Part shall come into force on such date as the Minister responsible for finance may, by notice in the Gazette establish, and different dates may be established for different provisions and different purposes of this Part.” .
123. Article 2 of the principal Act shall be amended as follows> (a) in the definition “asset manager”, for the words
“discretionary or non-discretionary investment services to” there
shall be substituted the words “the investment service of managing investments of”<
(b) in the definition “scheme”, for the words “means a scheme or arrangement established by contract which governs the rights and responsibilities of the retirement scheme administrator and contributor thereto, and” there shall be substituted the words “means a scheme or arrangement which is registered under this Act”< and
(c) in the definition “scheme document”, for the word
“contract” there shall be substituted the word “instrument”.
124. Subarticle (1) of article 4 of the principal Act shall be amended as follows>
(a) in paragraph (b) thereof, for the word “shall” there shall be substituted the word “may”< and
(b) in paragraph (i) thereof, for the words “auditor, or actuary of the scheme<” there shall be substituted the words “auditor, actuary or any other party to the scheme<”.
125. Article 17 of the principal Act shall be amended as follows>
A 489

Deletion of the Fourth Schedule to the principal Act.

Amendment of the Special Funds (Regulation) Act, Cap. 450.

Amendment of article 2 of the principal Act.

Amendment of article 4 of the principal Act.

Amendment of article 17 of the principal Act.

A 490

Amendment of article 19 of the principal Act.

(a) for subarticle (1) thereof, there shall be substituted the following>
“(1) No person shall provide a retirement fund or a scheme with any administrative services described in articles
18 and 19, trustee services or any other services as the Authority may specify, unless such person is registered under this Act as a retirement fund administrator or a scheme administrator as the case may be, or is otherwise registered by the Authority to perform any such services.”< and
(b) immediately after subarticle (6) there shall be inserted the following new subarticle (7)>
“(7) The provisions of this Act applicable to retirement scheme administrators and retirement fund administrators, as the case may be, shall apply mutatis mutandis to persons who provide trustee services or any other services in accordance with subarticle (1) of this article unless the Authority otherwise provides. The Authority may issue any directives to regulate the activities of trustees providing trustee services under this Act and it may impose such conditions as it deems appropriate in relation to the services provided by a trustee or trustees in the context of a Scheme.”.
126. Subarticle (1) of article 19 of the principal Act shall be amended as follows>
(a) in paragraph (a) thereof, for the words “all contributions in the retirement fund in accordance with” there shall be substituted the words “all contributions in accordance with”<
(b) in paragraph (c) thereof, for the words “of the scheme document<”, there shall be substituted the words “of the scheme document and that all disbursements are effected in accordance with the scheme document<”<
(c) for paragraph (d) thereof, there shall be substituted the following>
“(d) maintaining custody of assets<”< and
(d) in paragraph (h) thereof>
(i) for the words “the shares of a retirement fund or funds” , there shall be substituted the words “any security in
which the scheme may be invested, including the shares of any retirement fund or funds, as may be applicable,”< and
(ii) for the words “such redemption” there shall be substituted the words “such redemption or liquidation”.
127. Subarticle (1) of article 24 of the principal Act shall be amended as follows>
(a) for the words “providing discretionary or non- discretionary investment management services constituting investment services to” there shall be substituted the words “managing investments of”< and
(b) for the words “asset manager in accordance with this Act” there shall be substituted the words “asset manager or, a retirement scheme administrator duly authorized to provide investment management services, in accordance with this Act”.
128. In article 37 of the principal Act, for the words “may only invest in” there shall be substituted the words “may invest in”.
129. Article 38 of the principal Act shall be amended as follows> (a) in subarticle (1) thereof, for the words “A retirement
fund shall comply” there shall be substituted the words “A
retirement fund or scheme shall comply”< (b) in subarticle (2) thereof>
(i) for the words “A retirement fund shall comply” there shall be substituted the words “A retirement fund or scheme shall comply”< and
(ii) in paragraph (d) thereof, for the words “the retirement fund shall derive” there shall be substituted the words “the retirement fund or scheme shall derive”<
(c) in subarticle (3) thereof, for the words “retirement fund shall comply” there shall be substituted the words “retirement fund or scheme shall comply”< and
(d) in paragraph (b) of subarticle (4) thereof>
(i) for the words “to a retirement fund and” there shall be substituted the words “to a retirement fund or scheme and”< and
A 491

Amendment of article 24 of the principal Act.

Amendment of article 37 of the principal Act.

Amendment of article 38 of the principal Act.

A 492

Amendment of article 50 of the principal Act.

(ii) for the words “by the retirement fund.” there shall be substituted the words “by the retirement fund or scheme.”.
130. In paragraph (b) of subarticle (1) of article 50 of the principal Act, for the words “Retirement Fund Custodian” there shall be substituted the words “Retirement Fund or Scheme Custodian” .
SCHEDULE
A 493
(Article 2)
INSURANCE INTERMEDIARIES AND INSURANCE INTERMEDIARIES ACTIVITIES
For the purposes of paragraph 1 of the Third Column of this Schedule, “risk” means and includes a risk situated in Malta or a risk situated outside Malta< and “risk situated outside Malta”, in relation to a contract of insurance, has the same meaning as is assigned to it by subarticle (1) of article 2 of the Insurance Business Act<

A 494

A 495
Passed by the House of Representatives at Sitting No. 424 of 25th July, 2006.
ANTON TABONE

Speaker

RICHARD J. CAUCHI

Clerk to the House of RepresentativesI assent.