S.L. 370.22 Art. 8Breaches by European AIFMs. Temporary permission granted by the competent authority to UK alternative investment fund managers to continue servicing existing contracts with existing clients.

(1) The competent authority may require a European AIFM managing or marketing AIFs in Malta, whether or not through a branch, to provide the information necessary for the supervision of the European AIFM’s compliance with the applicable regulatory provisions 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 a European AIFM managing and, or marketing Maltese, and, or 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 European AIFM concerned 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 European AIFM concerned refuses to provide the competent authority with information for which such authority 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 competent authority shall be notified by the European regulatory authority of the nature of any measures taken.

(4) Where a European 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 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, including those laid down in Articles 46 and 48 of the AIFM Directive, to prevent or penalise further irregularities and, in so far as necessary, to prevent the European AIFM from initiating any further transactions in Malta. Where the function carried out in Malta by the European AIFM is the management of AIFs, the competent authority may require that the European AIFM cease managing those AIFs.

(5) Where the competent authority has clear and demonstrable grounds for believing that a European 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 finding to the European regulatory authority of the home Member State or EEA State of the European AIFM, which shall take appropriate measures, including if necessary, request additional information from the relevant supervisory authorities in third countries.

(6) Where a European 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 European AIFM, or due to the inadequacy of such measures in the European 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 European AIFM concerned to further market the units or shares of the relevant AIF in Malta.

(7) The supervision of a European AIFM’s compliance with Articles 12 and 14 of the AIFM Directive shall be the responsibility of the competent authority where the European AIFM manages and, or markets AIFs through a branch established in Malta. 9. Repealed by Legal Notice 147 of 2023.