S.L. 370.20 Art. 3Freedom of establishment of Maltese management companies - branch.

(1) Where a Maltese management company decides to establish a branch in a Member State or EEA State other than

Malta, it shall notify the competent authority accordingly.

(2) A notification in terms of sub-regulation (1) shall be accompanied by the following information and documentation:

(a) the Member State or EEA State within the territory of which the Maltese management company plans to establish a branch;

(b) a programme of operations setting out the activities and services as prescribed in the applicable Investment Services Rules which shall be carried out by such branch;

(c) the proposed organisational structure of the branch, including a description of the risk management process in place and a description of the procedures and arrangements implemented to ensure a suitable investor complaints procedure in terms of the Investment Services Rules;

(d) the address of the proposed branch in the host Member State or EEA State from where documents may be obtained; and

(e) the names of the persons responsible for the management of the branch.

(3) The competent authority shall communicate the information in sub-regulation (2) and details of the Maltese investor compensation scheme to the European regulatory authority of the Member State or EEA State where the Maltese management company intends to establish a branch within two months of receiving such information. The competent authority shall also inform the Maltese management company of such communication accordingly.

(4) Where the branch of the Maltese management company will carry out the activity of collective portfolio management pursuant to the Investment Services Rules, the notification made in accordance with sub-regulations (1) and (2) shall also include an attestation that the Maltese management company has been licensed to pursue such activity in terms of the UCITS Directive, a description of the scope of the Maltese management company’s licence and details of any restriction on the types of UCITS that the Maltese management company is licensed to manage.

(5) Where the competent authority has sufficient reason to doubt the adequacy of the administrative structure or the financial situation of a Maltese management company, taking into account the activities for which it has been licensed, it may refuse to make the communication referred to in sub-regulation (3) and shall, within two months from the date of receipt of the notice referred to in sub-regulation (1), give the Maltese management company reasons for such refusal.

(6) A Maltese management company which pursues activities through a branch within the territory of another Member State or EEA State shall comply with the applicable provisions on conduct of business in force in that Member State or EEA State.

(7) A branch of a Maltese management company shall not commence business unless:

(a) the European regulatory authority in the Member State or EEA State in which the Maltese management company proposes to establish a branch has notified the Maltese management company of the receipt of the communication referred to in sub-regulation (3) from the competent authority; or

(b) two months have elapsed from the date on which the competent authority has transmitted the communication referred to in sub-regulation (3) and the Maltese management company has not received any communication from such European regulatory authority.

(8) Where the Maltese management company plans a change in any of the particulars communicated in accordance with sub-regulation (2)(b) to (e), written notice of such change shall be given to the competent authority and to the European regulatory authority of the Member State or EEA State in which the branch is established not less than one month prior to the implementation of such change, and the provisions of sub-regulations (3), (4), (5) and

(7) shall apply.

(8A) Where, pursuant to a change referred to in sub-regulation (8), the Maltese management company would no longer comply with the UCITS Directive, the competent authority shall inform the Maltese management company within fifteen (15) working days of receipt of all the information referred to in sub-regulation (8) that it is not to implement that change. The competent authority shall also inform the European regulatory authority of the Member State or EEA State in which the branch is established accordingly.

(8B) Where a change referred to in sub-regulation (8) is implemented after information has been transmitted in accordance with sub-regulation (8A), and pursuant to that change the Maltese management company no longer complies with the UCITS Directive, the competent authority shall take all appropriate measures in accordance with the provisions of the Act and any other Act administered by the competent authority and any regulations issued thereunder, and shall notify the European regulatory authority of the Member State or EEA State in which the branch is established without undue delay of the measures taken.

(9) In the event of a change in the particulars communicated in accordance with sub-regulations (2) and (3), the competent authority shall inform the European regulatory authority accordingly. The competent authority shall update the attestation referred to sub-regulation (4) and shall, without delay, inform the European regulatory authority of the Member State or EEA state in which the branch is established whenever there is a change in the scope of a Maltese management company’s authorisation or in the details of any restriction on the types of UCITS that a Maltese management company is licensed to manage.