S.L. 330.6 Art. 2Interpretation.

In these regulations, unless the context otherwise requires:

"the Act" means the Malta Financial Services Authority Act;

"the Authority" means the Malta Financial Services Authority established by article 3 of the Act;

"alternative investment fund manager" means a manager of alternative investment funds within the meaning of Article 4(1)(b),

(l) and (ab) of Directive 2011/61/EU or an undertaking the registered office of which is in a third country and which would require authorisation under that Directive if its registered office were within the European Union;

"asset management company" means a management company within the meaning of Article 2(1)(b) of Directive 2009/65/EC or an undertaking the registered office of which is in a third country and which would require authorisation under that Directive if it had its registered office within the European Union;

"balance sheet total" means total assets reported in the balance sheet;

"binding legal instruments" means any directly applicable measures, including, but not limited to, any implementing technical standards, regulatory technical standards or similar measures, issued under European Union legislation; "close links" means a situation in which two or more natural or legal persons are linked by control or participation, or a situation in which two or more natural or legal persons are permanently linked to the same person by a control relationship; "the Commission" means the Commission of the European Union; "competent authorities":

(a) in the case of Malta, means the Authority;

(b) in the case of another Member State, means the national authority or national authorities of the Member State which are empowered by law or regulation to supervise credit institutions, insurance undertakings, reinsurance undertakings, investment firms, asset management companies or alternative investment fund managers whether on an individual or a group-wide basis;

"control" means a relationship between a parent undertaking and a subsidiary undertaking as set out in Article 1 of Directive 83/349/ EEC and includes a similar relationship between a natural or legal person and an undertaking; "coordinator" means the Authority or a competent authority appointed under regulation 11; "credit institution" shall have the same meaning as is assigned to it in paragraph (1) of Article 4(1) of Regulation (EU) No. 575/ 2013;

"the Financial Conglomerates Directive" means Directive 2002/ 87/EC of the European Parliament and of the Council of 16 December, 2002 on the supplementary supervision of credit institutions, insurance undertakings and investment firms in a financial conglomerate and amending Council Directives 73/239/ EEC, 2002/83/EC, 92/49/EEC, 92/96/EEC, 93/6/EEC and 93/22/ EEC, and Directives 98/78/EC and 2000/12/EC of the European Parliament and of the Council as amended by Directive 2011/89/EC of the European Parliament and of the Council of 16 November 2011 amending Directive 98/78/EC, 2002/87/EC, 2006/48/EC and 2009/138/EC as regards supplementary supervision of financial entities in a financial conglomerate and as may be amended from time to time; "financial conglomerate" means a group or subgroup, where a regulated entity is at the head of the group or subgroup, or where at least one of the subsidiaries in that group or subgroup is a regulated entity and which meets the following conditions:

(a) where there is a regulated entity at the head of the group or subgroup:

(i) that entity is a parent undertaking of an entity in the financial sector, an entity which holds a participation in an entity in the financial sector, or an entity linked with an entity in the financial sector by a relationship within the meaning of Article 12(1) of Directive 83/349/EEC;

(ii) at least one of the entities in the group or subgroup is within the insurance sector and at least one is within the banking or investment services sector; and

(iii) the consolidated or aggregated activities of the entities in the group or subgroup within the insurance sector and of the entities within the banking and investment services sector are both significant within the meaning of Article 3(2) or

(3) of the Financial Conglomerates Directive; or

(b) where there is no regulated entity at the head of the group or subgroup:

(i) the group’s or subgroup’s activities mainly occur in the financial sector within the meaning of regulation 3(1);

(ii) at least one of the entities in the group or subgroup is within the insurance sector and at least one is within the banking or investment services sector; and

(iii) the consolidated or aggregated activities of the entities in the group or subgroup within the insurance sector and of the entities within the banking and investment services sector are both significant within the meaning of Article 3(2) or

(3) of the Financial Conglomerates Directive; "Financial Conglomerates Committee" means the Committee set up by the Commission in pursuance of Article 21 of the Financial Conglomerates Directive; "financial sector" means a sector composed of one or more of the following entities:

(a) a credit institution, a financial institution or an ancillary services undertaking within the meaning of paragraphs (1), (26) or (18), respectively, of Article 4(1) of Regulation (EU) No. 575/2013, hereinafter collectively referred to as "the banking sector";

(b) an insurance undertaking, a reinsurance undertaking or an insurance holding company within the meaning of Article 13(1), (2), (4) or (5) or of Article 212(1)(f) of Directive 2009/138/EC, hereinafter collectively referred to as "the insurance sector";

(c) an investment firm within the meaning of Article 3(1)(b) of Directive 2006/49/EC, hereinafter collectively referred as "the investment services sector";

"group" means a group of undertakings which consists of a parent undertaking, its subsidiaries and the entities in which the parent undertaking or its subsidiaries hold a participation, as well as undertakings linked to each other by a relationship within the meaning of Article 12(1) of Directive 83/349/EEC, including any subgroup thereof; "insurance undertaking" shall have the same meaning as is assigned to it in Article 13(1), (2) or (3) of Directive 2009/138/EC; "intra-group transactions" means all transactions by which regulated entities within a financial conglomerate rely either directly or indirectly upon other undertakings within the same group or on any natural or legal person linked to the undertakings within that group by close links, for the fulfilment of an obligation, whether or not contractual, and whether or not for payment; "investment firm" shall have the same meaning as is assigned to it in point 1 of Article 4(1) of Directive 2004/39/EC, including the undertakings referred to in Article 3(1)(d) of Directive 2006/49/EC of the European Parliament and of the Council of 14 June 2006 on the capital adequacy of investment firms and credit institutions or an undertaking the registered office of which is in a third country and which would require authorisation under Directive 2004/39/EC if its registered office were in the European Union;

"Joint Committee" means the Committee of the European Supervisory Authorities (ESA) established by Article 54 of Regulation (EU) No 1093/2010 of the European Parliament and of the Council of 24 November 2010, of Regulation (EU) No 1094/ 2010 of the European Parliament and of the Council of 24 November 2010 and of Regulation (EU) No 1095/2010 of the European Parliament and of the Council of 24 November 2010; "Member State" means a State which is a member of the European Union; "mixed financial holding company" means a parent undertaking which is not a regulated entity and which, together with its subsidiaries and other entities, constitutes a financial conglomerate, provided that at least one of its subsidiaries is a regulated entity having its head office in the European Union; "parent undertaking" shall have the same meaning as is assigned to it in Article 1 of the Seventh Council Directive 83/349/EEC of 13 June, 1983 on consolidated accounts and shall include any undertaking which, in the opinion of the competent authorities, effectively exercises a dominant influence over another undertaking;

"participation" shall have the same meaning as is assigned to it in the first sentence of Article 17 of Fourth Council Directive 78/ 660/EEC of 25 July, 1978 on the annual accounts of certain types of companies and shall include the direct or indirect ownership of 20 per centum or more of the voting rights or capital of an undertaking; "proportional share" means the proportion of the subscribed capital which is held, directly or indirectly, by that undertaking; "regulated entity" means a credit institution, an insurance undertaking, a reinsurance undertaking, an investment firm, an asset management company or an alternative investment fund manager and includes a regulated entity authorised in Malta;

"regulated entity authorised in Malta" means:

(a) a credit institution licensed in terms of article 5 of the Banking Act;

(b) an insurance undertaking or a reinsurance undertaking duly authorised in terms of article 7 of the Insurance Business Act;

(c) an investment services licence holder licensed in terms of article 3 of the Investment Services Act; or

(d) a financial institution licensed in terms of article 3 of the Financial Institutions Act; "reinsurance undertaking" shall have the same meaning as is assigned to it in Article 13(4), (5) or (6) of Directive 2009/138/EC and shall include a special purpose vehicle within the meaning of Article 13(26) of Directive 2009/138/EC; "relevant competent authorities" means:

(a) the competent authorities of the Member States responsible for the sectoral group-wide supervision of any of the regulated entities in a financial conglomerate, in particular of the ultimate parent of a sector;

(b) the coordinator appointed in accordance with regulation 11, if different from the authorities referred to in paragraph (a);

(c) where appropriate, other competent authorities deemed to be relevant by the authorities referred to in paragraphs (a) and (b); this opinion shall in particular take into account the market share of the regulated entities of the conglomerate in other Member States, in particular if it exceeds five (5) per centum, and the importance in the conglomerate of any regulated entity established in another Member State;

"risk concentration" means all risk exposures with a loss potential which is large enough to threaten the solvency or the financial position in general of the regulated entities in the financial conglomerate whether such exposures are caused by counterparty risk/credit risk, investment risk, insurance risk, market risk, other risks, or a combination or interaction of these risks; "sectoral rules" means:

(a) European Union legislation relating to the prudential supervision of regulated entities, in particular the provisions of:

(i) Regulation (EU) No 575/2013 of the European Parliament and of the Council of 26 June 2013 on prudential requirements for credit institutions and amending Regulation (EU) No 648/2012, as may be amended from time to time, and includes any binding legal instruments, guidelines and other measures that have been or may be issued thereunder;

(ii) Regulation (EU) 2019/2033 of the European Parliament and of the Council of 27 November 2019 on the prudential requirements of investment firms and amending Regulations

(EU) No 1093/2010, (EU) No 575/2013, (EU) No 600/2014 and (EU) No 806/2014, as may be amended from time to time, and includes any binding legal instruments, guidelines and other measures that have been or may be issued thereunder;

(iii) Directive 2009/138/EC of the European Parliament and of the Council of 25 November 2009 on the taking-up and pursuit of the business of Insurance and Reinsurance (Solvency II), as amended from time to time, and includes any binding legal instruments, guidelines and other measures that have been or may be issued under the said Directive;

(iv) Directive 2013/36/EU of the European Parliament and of the Council of 26 June 2013 on access to the activity of credit institutions and the prudential supervision of credit institutions, amending Directive 2002/87/EC and repealing Directives 2006/48/EC and 2006/49/EC, as amended from time to time, and includes any binding legal instruments, guidelines and other measures that have been or may be issued under the said Directive 2013/36/EU;

(v) MiFID;

(b) any applicable Acts administered by the Authority, including any regulations and rules issued thereunder, in relation to any regulated entity;

(vi) Directive (EU) 2019/2034 of the European Parliament and of the Council of 27 November 2019 on the prudential supervision of investment firms and amending Directives 2002/87/EC, 2009/65/EC, 2011/61/EU, 2013/36/EU, 2014/59/EU and 2014/65/EU, as amended from time to time, and includes any binding legal instruments, guidelines and other measures that have been or may be issued under the said Directive (EU) 2019/2034;"subsidiary undertaking" shall have the same meaning as is assigned to it in Article 1 of Directive 83/349/EEC and shall include any undertaking over which, in the opinion of the competent authorities, a parent undertaking effectively exercises a dominant influence; and all subsidiary undertakings of subsidiary undertakings shall also be considered as subsidiary undertakings of the parent undertaking;

"the Tribunal" means the Financial Services Tribunal established under article 21 of the Act.