S.L. 370.21 Art. 5Marketing of units or shares of European AIFs by a European AIFM in Malta.

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

(4) The European AIFM shall submit to the European regulatory authority in its home Member State or EEA State 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 European 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 referred to in Article 23(1) of the AIFM Directive for each European AIF which the European AIFM intends to market;

(g) the indication that the European AIFM intends marketing the units or shares of the European AIF to professional investors in Malta;

(h) information about arrangements made for the marketing of European AIFs and, where relevant, information on the arrangements established to prevent units or shares of the European AIFs from being marketed to retail investors, including in the case where the European AIFM relies on activities of independent entities to provide investment services in respect of the AIF;

(i) the details necessary, including the address, for the invoicing or for the communication of any applicable regulatory fees or charges by the competent authorities of the host Member State: Provided that the notification letter to the European regulatory authority by the European AIFM as referred to above shall be provided in a language customary in the sphere of international finance.

(5) The competent authority shall, no later than twenty working days after the date of receipt of a complete notification file pursuant to sub-regulation (4), receive from the European regulatory authority of the AIFM’s home Member State or EEA State the complete notification file.

(6) The notification file transmitted to the competent authority shall also include a statement to the effect that the European AIFM concerned is authorised to manage European AIFs with a particular investment strategy: Provided that the statement referred to above shall be provided in a language customary in the sphere of international finance.

(7) The competent authority shall only receive the complete notification file if the European AIFM’s management of the European AIF complies with and will continue to comply with the provisions of the AIFM Directive and if the European AIFM otherwise complies with the provisions of the AIFM Directive.

(8) Upon transmission of the notification file to the competent authority, the European AIFM may start marketing the European AIF in Malta as from the date that it is notified by the European regulatory authority of such transmission.

(9) Arrangements referred to in sub-regulation (4)(h) shall be subject to the laws of Malta and to the supervisions of the competent authority.

(10) The European AIFM may de-notify arrangements made for marketing of units or shares of some or all of the European AIFs under its management in Malta, in respect of which it has made a notification pursuant to sub-regulation (4), where all the following conditions are fulfilled:

(a) except in the case of closed-ended AIFs and funds regulated by Regulation (EU) 2015/760 of the European Parliament and of the Council of 29 April 2015 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 (11). As of the date referred to in point (c) of this sub-regulation, the European 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 (11).

(11) The European AIFM shall submit a notification to the European regulatory authority of its home Member State or EEA State containing the information referred to in points (a), (b) and

(c) of sub-regulation (10).

(12) The European regulatory authority of the AIFM’s home Member State or EEA State shall verify whether the notification submitted by the European AIFM in accordance with sub-regulation (11) is complete and no later than 15 working days from the receipt of a complete notification, transmit that notification to the competent authority and to ESMA. Upon transmission of the notification, the European regulatory authority of the home Member State or EEA State shall promptly notify the European AIFM of that transmission. For a period of 36 months from the date referred to in point (c) of the sub-regulation (10), the European 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 Malta.

(13) The European AIFM shall provide investors who remain invested in the European AIF as well as the competent authorities of the AIFM’s host Member State or EEA State with the information required under Articles 22 and 23 of the AIFM Directive. Such information can be provided, among others, using means of any electronic or other distance communication.

(14) The European regulatory authority of the European AIFM’s home Member State or EEA State shall transmit to the competent authorities of the Member State or EEA State, identified in the notification referred to in sub-regulation (11), information on any changes to the documentation and information referred to in points

(b) to (f) of sub-regulation (4).

(14A) Where the competent authority is identified in the notification referred to in sub-regulation (11), it shall have the same rights and obligations as the competent authorities of the host Member State of the AIFM as set out in Article 45 of the AIFM Directive.

(14B) Without prejudice to other supervisory powers referred to in Article 45(3) of the AIFM Directive, as transposed into national law, as from the date of transmission under sub-regulation (14), the competent authority shall not require the European AIFM concerned to demonstrate compliance with national laws, regulations and administrative provisions governing marketing requirements as referred to in Article 5 of Regulation (EU) 2019/1156 of the European Parliament and of the Council of 20 June 2019 on facilitating cross-border distribution of collective investment undertakings and amending Regulations (EU) No 345/2013, (EU) No 346/2013 and (EU) No 1286/2014.

(15) The European AIFM may engage in pre-marketing 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 European AIFM does not require to submit any prior notification to the competent authority before it engages in pre-marketing activity in Malta, provided however that it fulfils the requirements set out in this regulation.

(18) The European AIFM shall ensure that investors do not acquire units or shares in an AIF through pre-marketing and that investors contacted as part of pre-marketing may only acquire units or shares in that AIF through marketing permitted under sub-regulation 5(1).

(19) Any subscription by professional investors, within eighteen (18) months of the European AIFM having begun pre-marketing, to units or shares of an AIF referred to in the information provided in the context of pre-marketing, or of an 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 sub-regulation 5(4).

(20) Within two (2) weeks of it having begun pre-marketing, the European AIFM shall send to the European regulatory authority of the European AIFM’s home Member State or EEA State an informal letter, in paper form or by electronic means, which letter shall specify:

(a) the Member States in which and the periods during which the pre-marketing is taking or has taken place;

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

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

(21) The competent authority may request the European regulatory authority of the European AIFM’s home Member State or EEA State to provide further information on the pre-marketing that is taking or has taken place on its territory.

(22) The European AIFM shall ensure that pre-marketing is adequately documented.

(23) A third party shall only engage in pre-marketing on behalf of a European 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 European AIFM. MARKETING OF AIFs TO RETAIL INVESTORS IN MALTA