S.L. 370.24 Art. 24Breaches by European AIFMs or third country AIFMs authorised in a Member State or EEA State other than Malta.

(1) The competent authority may require a European

AIFM or a third country AIFM licensed in a Member State or EEA

State other than Malta managing or marketing AIFs in Malta, whether or not through a branch, to provide the information necessary for the supervision of the AIFM’s compliance with the applicable provisions of the AIFM Directive for which the competent authority is responsible: Provided that the requirements imposed shall not be more stringent than those which the competent authority imposes on Maltese AIFMs for monitoring compliance with the same provisions.

(2) Where the competent authority ascertains that an AIFM managing and, or marketing European AIFs in Malta, whether or not through a branch, is in breach of one of the provisions in relation to which the competent authority is responsible for supervising compliance, the competent authority shall require the AIFM to put an end to that breach and shall proceed to notify the European regulatory authority of the home Member State or EEA State thereof.

(3) If the AIFM concerned refuses to provide the competent authority with information for which it is responsible, or fails to take the necessary steps to put an end to the breach identified in sub-regulation (2), the competent authority shall inform the European regulatory authority of its home Member State or EEA State thereof: Provided that the European regulatory authority shall notify the competent authority of any measures taken.

(4) Where an AIFM continues in its refusal to provide information requested by the competent authority in terms of sub-regulation (1), or persists in breaching the legal or regulatory provisions referred to in sub-regulation (2) in force in Malta, despite the measures taken by the European regulatory authority of the home Member State or EEA State or due to the inadequacy or unavailability of such measures in the said home Member State or EEA State, the competent authority may, after informing the European regulatory authority of the home Member State or EEA State of the European AIFM, take appropriate measures under the provisions of the Act and any regulations made thereunder, to prevent or penalise further irregularities and, in so far as necessary, to prevent the AIFM from initiating any further transactions in Malta. Where the function carried out in Malta by the AIFM is the management of AIFs, the competent authority may require that the AIFM ceases managing those AIFs.

(5) Where the competent authority has clear and demonstrable grounds for believing that an AIFM is in breach of the obligations arising from provisions in relation to which the competent authority has no responsibility for supervising compliance, the competent authority shall refer those findings to the European regulatory authority of the home Member State or EEA State of the AIFM, which shall take appropriate measures, including, if necessary, requesting additional information from the relevant supervisory authorities in third countries.

(6) Where an AIFM persists in acting in a manner that is clearly prejudicial to the interests of the investors of the relevant AIF, the financial stability or the integrity of the Maltese market, despite the measures taken by the European regulatory authority in the home Member State or EEA State of the AIFM, or due to the inadequacy of such measures in the Member State or EEA State or because the European regulatory authority fails to act within a reasonable time, the competent authority may, after informing the European regulatory authority in the home Member State or EEA State, take all appropriate measures needed in order to protect the investors of the relevant AIF, the financial stability and integrity of the Maltese market, including the possibility of preventing the AIFM concerned to further market the units or shares of the relevant AIF in Malta.

(7) The procedure prescribed in sub-regulations (5) and (6) shall also apply in the event that the competent authority has clear and demonstrable grounds for disagreement with the authorisation of a third country AIFM by the Member State of reference.

(8) Where the competent authority disagrees on any of the measures taken by a European regulatory authority pursuant to sub-regulations (2) to (7), it may bring the matter to the attention of ESMA, which may act in accordance with the powers conferred to it under Article 19 of Regulation (EU) No 1095/2010.

(9) In so far as applicable, ESMA shall facilitate the negotiation and conclusion of the cooperation arrangements required by the AIFM Directive between the competent authority, the European regulatory authorities and the supervisory authorities of third countries.