S.L. 123.127 Art. 33Imposition of penalties.

(1) Where a Financial Institution fails to comply with any of the obligations established in the FATCA Agreement or the FATCA

Regulations, the Financial Institution shall be liable:

(a) where a Reporting Malta Financial Institution fails to maintain the information required to be maintained in terms of Article 2(2)(a) and Article 3(2) of the FATCA Agreement, to a penalty of two thousand five hundred euro (€2,500);

(b) where a Reporting Malta Financial Institution fails to apply the due diligence procedures specified in Annex I of the FATCA Agreement to identify U.S. Reportable Accounts and accounts held by Non-participating Financial Institutions, to a penalty of five thousand euro (€5,000);

(c) where a Reporting Malta Financial Institution fails to report the information required to be reported in terms of regulation 30 within the time stipulated in said regulation, to a penalty of:

(i) two thousand five hundred euro (€2,500); and

(ii) one hundred euro (€100) for every day during which the default existed: provided that this penalty shall not exceed in total twenty thousand euro (€20,000);

(d) where a Reporting Malta Financial Institution fails to report the information required to be maintained in terms of Article 2(2)(a) and Article 3(2) of the FATCA Agreement in a complete and accurate manner, to a penalty of:

(i) in the case of minor errors -

(aa) two hundred euro (€200); and

(bb) fifty euro (€50) for every day during which the default existed: provided that this penalty shall not exceed in total five thousand euro (€5,000);

(ii) in the case of significant non-compliance, fifty thousand euro (€50,000). Furthermore, where the United States commences to treat a Reporting Malta Financial Institution as a Non-participating Financial Institution and its details are published by the IRS, the Commissioner shall publish details identifying such an institution on the website of the Commissioner for Revenue and inform any relevant regulator in Malta of such;

(e) where a Financial Institution fails to comply with a request for information by the Commissioner made consequent to regulation 31, to a penalty of:

(i) one thousand euro (€1000); and

(ii) one hundred euro (€100) for every day during which the default existed: provided that this penalty shall not exceed in total thirty thousand euro (€30,000).

(f) where a Reporting Malta Financial Institution relies on an invalid self-certification, and such Reporting Malta Financial Institution knows or has reason to know that this is invalid, to a penalty of five thousand euro (€5,000). An account holder who provides a false self-certification, including signing or otherwise positively affirming a false self-certification, shall also be liable to a penalty of five thousand euro (€5,000).

(2) In addition and without prejudice to any penalties incurred in terms of sub-article (1), where a Reporting Malta Financial Institution is found to have submitted information that is misleading, deceitful or false, every senior managing official of such Reporting Malta Financial Institution shall be guilty of an offence and shall on conviction be liable to a fine (multa) of not less than ten thousand euro (€10,000) and not more than thirty thousand euro (€30,000), or to imprisonment for a period of not exceeding two years, or both such fine (multa) and imprisonment:

Provided that a director, manager or other principal officer of such Reporting Malta Financial Institution shall not be guilty of such an offence in virtue of this sub-regulation if he proves that he was unaware and could not with reasonable diligence be aware of such act or omission and that he did everything within his power to prevent that act or omission.