S.L. 345.24 Art. 4Specific requirements for MTFs. S.L. 370.05. S.L. 345.06.

(1) Maltese investment firms and market operators operating an MTF shall, in addition to meeting the requirements prescribed in regulation 3 and the applicable provisions of the Investment Services Act (Control of Assets) Regulations, the

Investment Services Rules for Investment Services Providers and the Conduct of Business Rulebook, establish and implement non-discretionary rules for the execution of orders in the system.

(2) Member States shall require that the provisions of regulation 3(1)(e), governing access to an MTF, comply with the conditions established in regulation 8 of the Financial Markets Act (Membership and Access) Regulations.

(3) Maltese investment firms and market operators operating an MTF shall have arrangements:

(a) to be adequately equipped to manage the risks to which it is exposed, to implement appropriate arrangements and systems to identify all significant risks to its operation, and to put in place effective measures to mitigate those risks;

(b) to have effective arrangements to facilitate the efficient and timely finalisation of the transactions executed under its systems; and

(c) to have available, at the time of authorisation and on an ongoing basis, sufficient financial resources to facilitate its orderly functioning, having regard to the nature and extent of the transactions concluded on the market and the range and degree of the risks to which it is exposed.

(4) The rules prescribed in the Conduct of Business Rulebook on general principles and information to clients, assessment of suitability and appropriateness and reporting to clients, obligations to execute orders on terms most favourable to the client and client order handling rules are not applicable to the transactions concluded under the rules governing an MTF between its members or participants or between the MTF and its members or participants in relation to the use of the MTF.

(5) The members of or participants in the MTF shall comply with the obligations prescribed in the Conduct of Business Rulebook on general principles and information to clients, assessment of suitability and appropriateness and reporting to clients, obligations to execute orders on terms most favourable to the client and client order handling rules with respect to their clients when, acting on behalf of their clients, they execute their orders through the systems of an MTF.

(6) Maltese investment firms or market operators operating an MTF shall not execute client orders against proprietary capital, or engage in matched principal trading.