S.L. 370.10 Art. 12Contraventions by European investment firms.

Where the competent authority has clear and demonstrable grounds for believing:

(a) that a European investment firm providing services in

Malta, in exercise of a European right, infringes the obligations arising from the provisions of the Act or any regulations issued thereunder or of any Investment Services Rules or Conduct of Business Rules issued by the competent authority, transposing the requirements of MIFID; or

(b) that a European investment firm that has established a branch in Malta, in exercise of a European right, infringes the obligations arising from the provisions of the Act or regulations issued thereunder or of any Investment Services Rules or Conduct of Business Rules issued by the competent authority transposing the requirements of MIFID which do not confer powers on the competent authority, it shall refer those findings to the European regulatory authority.

(2) If, despite the measures taken by the European regulatory authority or because such measures prove inadequate, the European investment firm persists in acting in a manner that is clearly prejudicial to the interests of Maltese investors or the orderly functioning of the markets, the following shall apply:

(a) after informing the European regulatory authority, the competent authority shall take all the appropriate measures needed in order to protect investors and the proper functioning of the markets, which shall include the possibility of preventing offending European investment firms from initiating any further transactions in Malta. The competent authority shall also inform the European Commission and ESMA of such measures without undue delay; and

(b) the competent authority may refer the matter to ESMA which may act in accordance with the powers conferred on it under Article 19 of the Regulation

(EU) No. 1095/2010.

(3) Where the competent authority ascertains that a European investment firm that has a branch in Malta infringes the provisions of the Act or regulations issued thereunder or of any Investment Services Rules or Conduct of Business Rules issued by the competent authority and which confer powers on the competent authority, it shall require the European investment firm concerned to put an end to its irregular situation.

(4) If the European investment firm concerned fails to take the necessary steps, the competent authority shall take all appropriate measures to ensure that the European investment firm concerned puts an end to its irregular situation. The nature of those measures shall be communicated to the European regulatory authority.

(5) Where, despite the measures taken by the competent authority, the European investment firm persists in breaching the provisions of the Act or regulations issued thereunder or any of Investment Services Rules or Conduct of Business Rules issued by the competent authority, the competent authority shall, after informing the European regulatory authority take all the appropriate measures needed to protect investors and the proper functioning of the markets. The competent authority shall inform the European Commission and ESMA of such measures without undue delay. In addition, the competent authority may refer the matter to ESMA, which may act in accordance with the powers conferred on it under Article 19 of the Regulation (EU) No 1095/ 2010.

(6) Any measure adopted pursuant to this regulation shall be communicated to the European investment firm concerned in writing, together with reasons justifying such measures and shall be subject to a right of appeal to the Tribunal and the provisions of article 19 of the Act shall apply mutatis mutandis.

Part IV - Advertising by European investment firms