S.L. 370.21 Art. 3Marketing of units or shares of European AIFs by a Maltese AIFM in Malta.

(1) A Maltese AIFM may market to professional investors in Malta, units or shares of a European AIF which it manages and such European AIF, prior to commencement of its marketing in

Malta, shall meeting the conditions prescribed in this regulation:

Provided that the European AIF shall be:

(a) authorised or registered in a Member State or EEA State other than Malta, and in such case shall be exempt from the provisions of article 4 of the Act;

(b) authorised in Malta;

(c) where not authorised or registered in a Member State or EEA State, the European AIF has its registered office and, or head office in a Member State or EEA State including Malta and in such case it shall be exempt from the provisions of article 4 of the Act.

(2) Without prejudice to regulation 6, European AIFs managed and marketed by a Maltese AIFM shall be marketed only to professional investors.

(3) Where the European AIF is a feeder AIF, the right to market referred to in sub-regulation (1) is subject to the condition that the master AIF is also a European AIF which is managed by an AIFM authorised by a Member State or an EEA State.

(4) The Maltese AIFM shall submit to the competent authority a notification in respect of each European AIF which it intends to market. Such notification shall comprise the documentation and information prescribed hereunder:

(a) a notification letter, including a programme of operations identifying the European AIFs which the Maltese AIFM intends to market and the information on where the AIFs are established;

(b) the European AIF’s prospectus or equivalent rules or instruments of incorporation;

(c) identification of the depositary of the European AIF;

(d) a description of, or any information on, the European AIF available to investors;

(e) information on where the master AIF is established if the AIF is a feeder AIF in terms of sub-regulation (3);

(f) any additional information concerning the disclosure obligations prescribed in Investment Services Rules, for each European AIF which the Maltese AIFM intends to market;

(g) where relevant, information on the arrangements established to prevent units or shares of the European AIF from being marketed to retail investors, including in the case where the Maltese AIFM relies on activities of independent entities to provide investment services in respect of the European AIF.

(5) Within twenty working days following receipt of a complete notification file pursuant to sub-regulation (4), the competent authority shall inform the Maltese AIFM whether it may start marketing the European AIF identified in the notification referred to in sub-regulation (4).

(6) In the case where the AIF identified in the notification referred to in sub-regulation (4) has been set up in a Member State or EEA State other than Malta, the competent authority shall proceed to inform the European Regulatory Authority of the home Member State or EEA State of the European AIF that the Maltese AIFM may start marketing the units or shares of the said AIF in Malta.

(7) In the case of a positive decision by the competent authority, the Maltese AIFM may start marketing the European AIF in Malta from the date of notification by the said competent authority to that effect.

(8) The competent authority shall prevent the marketing in Malta of a European AIF only if the Maltese AIFM’s management of the European AIF does not or will not comply with the provisions of the AIFM Directive, or the Maltese AIFM does not or will not comply with the provisions of the AIFM Directive.

(9) In the event of a material change to any of the particulars communicated in accordance with sub-regulation (4), the Maltese AIFM shall give written notice thereof to the competent authority at least one month prior to the implementation of such change in the case of changes planned by the Maltese AIFM, or immediately after an unplanned change has occurred.

(10) Where, pursuant to a planned change, the AIFM’s management of the European AIF would no longer comply with the provisions of the AIFM Directive or the Maltese AIFM would otherwise no longer comply with the provisions of the AIFM Directive, the competent authority shall within fifteen (15) working days of receipt of all the information referred to in the sub-regulation

(9) inform the Maltese AIFM that it shall not implement the change. In such case, the competent authority shall notify the European Regulatory Authority of the home Member State or EEA State of the AIF accordingly.

(11) Where the Maltese AIFM proceeds with the implementation of the planned change, notwithstanding the notification received pursuant to sub-regulation (10), or if an unplanned change has taken place pursuant to which the management of the European AIF by the Maltese AIFM no longer complies with the provisions of the AIFM Directive or the Maltese AIFM otherwise no longer complies with the provisions of the AIFM Directive, the competent authority shall take all due measures in accordance with the provisions of the Act and any regulations issued thereunder including, if necessary, the express prohibition of marketing of the European AIF.

(12) The Maltese AIFM may de-notify arrangements made for marketing of units or shares of some or all of the European AIFs under its management, in respect of which it has made a notification pursuant to this regulation, where all the following conditions are fulfilled:

(a) except in the case of closed-ended AIFs and funds regulated by the Regulation on European long-term investment funds, a blanket offer is made to repurchase or redeem, free of any charges or deductions, all such European AIF units or shares held by investors in Malta, is publicly available for at least thirty (30) working days, and is addressed, directly or through financial intermediaries, individually to all investors in Malta, whose identity is known;

(b) the intention to terminate arrangements made for marketing units or shares of some or all of its European AIFs in Malta is made public by means of a publicly available medium, including by electronic means, which is customary for marketing European AIFs and suitable for a typical European AIF investor; and

(c) any contractual arrangements with financial intermediaries or delegates are modified or terminated with effect from the date of de-notification in order to prevent any new or further, direct or indirect, offering or placement of the units or shares identified in the notification referred to in sub-regulation (13). As of the date referred to in paragraph (c), the Maltese AIFM shall cease any new or further, direct or indirect, offering or placement of units or shares of the European AIF it manages in Malta, in respect of which it has submitted a notification in accordance with sub-regulation (13).

(13) The Maltese AIFM shall submit a notification to the competent authority containing the information referred to in paragraphs (a), (b) and (c) of sub-regulation (12).

(14) The competent authority shall verify whether the notification submitted by the Maltese AIFM in accordance with sub-regulation (13) is complete and shall, no later than fifteen (15) working days from the receipt of a complete notification, transmit that notification to ESMA. Upon transmission of the notification, the competent authority shall without undue delay, notify the Maltese AIFM of that transmission. For a period of thirty six (36) months from the date referred to in paragraph (c) of sub-regulation (12), the Maltese AIFM shall not engage in pre-marketing of units or shares of the European AIFs referred to in the notification, or in respect of similar investment strategies or investment ideas, in the Member State identified in the notification referred to in sub-regulation (13).

(15) The Maltese AIFM may engage in pre-marketing to professional investors of units or shares of a European AIF in Malta, except where the information presented to potential professional investors:

(a) is sufficient to allow investors to commit to acquiring units or shares of a particular AIF;

(b) amounts to subscription forms or similar documents whether in a draft or a final form; or

(c) amounts to constitutional documents, a prospectus or offering documents of a not-yet-established AIF in a final form.

(16) Where a draft prospectus or offering documents are provided, they shall not contain information sufficient to allow investors to take an investment decision and shall clearly state that:

(a) they do not constitute an offer or an invitation to subscribe to units or shares of an AIF; and

(b) the information presented therein should not be relied upon because it is incomplete and may be subject to change.

(17) The Maltese AIFM is not required to submit any prior notification to the competent authority, of the content or of the addressees of pre-marketing, or to fulfil any conditions or requirements other than those set out in this regulation, before it engages in pre-marketing activity in Malta.

(18) The Maltese AIFM shall ensure that investors do not acquire units or shares in a European AIF through pre-marketing and that investors contacted as part of pre-marketing shall only acquire units or shares in that European AIF through marketing permitted under regulation 3(1).

(19) Any subscription by professional investors, within eighteen

(18) months of the Maltese AIFM having begun pre-marketing, to units or shares of a European AIF referred to in the information provided in the context of pre-marketing, or of a European AIF established as a result of the pre-marketing, shall be considered to be the result of marketing and shall be subject to the applicable notification procedures referred to in regulation 3(4).

(20) Within two (2) weeks of it having begun pre-marketing, the Maltese AIFM shall send to the competent authority an informal letter, in paper form or by electronic means, which letter shall specify:

(a) a brief description of the pre-marketing including information on the investment strategies presented; and

(b) where relevant, a list of the AIFs and compartments of AIFs which are or were the subject of pre-marketing.

(21) The Maltese AIFM shall ensure that pre-marketing is adequately documented.

(22) A third party shall only engage in pre-marketing on behalf of the Maltese AIFM where it is authorised as an investment firm in accordance with MIFID, as a credit institution in accordance with the CRD, as a UCITS management company in accordance with the UCITS Directive, as an AIFM in accordance with the AIFM Directive or acts as a tied agent in accordance with MIFID. Such a third party shall be subject to the conditions set out in this regulation in respect of the Maltese AIFM.

MARKETING OF UNITS OR SHARES OF EUROPEAN AIFs BY MALTESE AIFMs TO PROFESSIONAL INVESTORS IN A MEMBER STATE OR EEA STATE OTHER THAN MALTA