Malta: Investment Services Companies

02 March 2020

Since its accession to the European Union in May 2004, Malta’s financial services industry has grown robustly and is considered a jurisdiction of choice when it comes to the setting up of investment services companies.

Coupled with a robust but flexible regulatory framework and a favourable tax regime, Malta can offer fund managers and other investment services companies unprecedented synergies and added value.

A provision of Investment Services in Malta is regulated by the Investment Services Act (Cap. 370 of the Laws of Malta) (the “ISA”/the “Act”). Any person or entity providing or holding himself out as providing, an investment service in Malta or from Malta must possess a valid investment services licence issued by the MFSA or, alternatively, have a validly endorsed or “passported” license from another EU Member State.

The following services constitute licensable investment services when carried out in connection with “instruments” in terms of Malta’s Investment Services Act:

  • Reception and transmission of orders;
  • Execution of orders on behalf of other persons;
  • Dealing on own account;
  • Third party asset management;
  • Trustee, custodian or nominee services;
  • Investment advice in the form of personal recommendations (excluding recommendations issued exclusively through distribution channels or to the public);
  • Underwriting of instruments and, or placing of instruments on a firm commitment basis;
  • Placing of instruments without a firm commitment basis;
  • Operation of a multilateral trading facility, bringing together multiple third parties buying and   selling interests instruments, resulting in a contract.

The above services constitute investment services when they are carried out in respect of financial “instruments” as defined in the Second Schedule to the Investment Services Act.

Contact Rudolph Psaila to find out more.

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