S.L. 330.9 Art. 56Government financial stabilisation tools.

(1) The Ministry responsible for Finance may provide extraordinary public financial support through additional financial stabilisation tools in accordance with sub-regulation (3), regulation 37(10) and with Union State aid framework, for the purpose of participating in the resolution of an institution or an entity referred to in paragraphs (b), (c) or (d) of the definition "entity" in regulation 2(1), including by intervening directly in order to avoid its winding up, with a view to meeting the objectives for resolution referred to in regulation 31(2) in relation to Malta or the European Union as a whole. Such an action shall be carried out under the leadership of the Ministry responsible for Finance or the government in close cooperation with the Resolution Committee.

(2) In order to give effect to the government financial stabilisation tools, the Ministry responsible for Finance shall have the relevant resolution powers specified in regulations 63 to 72, and shall ensure that regulations 66, 68, 83 and 117 apply.

(3) The government financial stabilisation tools shall be used as a last resort after having assessed and exploited the other resolution tools to the maximum extent practicable whilst maintaining financial stability, as determined by the Ministry responsible for Finance or the government after consulting the Resolution Committee.

(4) When applying the government financial stabilisation tools, the Ministry responsible for Finance and the Resolution Committee shall apply the tools only if all the conditions laid down in regulation 32(1) as well as one of the following conditions are met:

(a) the Ministry responsible for Finance and the Resolution Committee, after consulting the Central bank and the Authority, determine that the application of the resolution tools would not suffice to avoid a significant adverse effect on the financial system;

(b) the Ministry responsible for Finance and the Resolution Committee determine that the application of the resolution tools would not suffice to protect the public interest, where extraordinary liquidity assistance from the Central bank has previously been given to the institution;

(c) in respect of the temporary public ownership tool, the Ministry responsible for Finance, after consulting the Authority and the Resolution Committee, determines that the application of the resolution tools would not suffice to protect the public interest, where public equity support through the equity support tool has previously been given to the institution.

(5) The financial stabilisation tools shall consist of the following:

(a) public equity support tool as referred to in regulation 57;

(b) temporary public ownership tool as referred to in regulation 58.