2006

ANNUAL REPORT
 Contents

Chairman’s Statement 2

Structure and Organisation 6

Supervision and Compliance of Licensed Companies 10

Legislative and Regulatory Developments 14

International Affairs 21

Human Resources Development 24

Business Development Overview 27

Consumer Complaints 38

Appendix A – List of the Bilateral and Multilateral Memoranda of Understanding 40

Appendix B – New Licences Issued during 2006 43

Abbreviations 45

2006
 CHAIRMAN’S STATEMENT
The Malta Financial Services Authority (MFSA) is
pleased to present its report on the activities and
operations carried out in 2006.
A YEAR OF STABILITY AND GROWTH
Malta’s financial services industry had a very good
year in 2006. The country’s financial services
economy remained stable, volumes grew in every
sector of the finance industry and business with
the EU and the rest of the world continued
to flow in.
It was a year that witnessed very strong
performances by capital markets across the globe.
Most EU economies picked up momentum and
China and India continued on their respective paths
to global economic superpower status. China and
India are producing large numbers of extremely
wealthy entrepreneurs and creating very high
growth companies in need of financial services
expertise. It is not for me to speculate as to which
jurisdictions will most benefit, but we do need to
be aware that the immense changes taking place
in India and China will have a competitive knock-
on effect, positive or negative, for the established
centres of London, New York and Frankfurt and
eventually, for Malta. But, as always, people will
gravitate to places with skills, expertise and robust
systems to protect the consumer and investor.
These are the critical factors we must ensure will
remain and the qualities we must effectively
promote.
For the MFSA, the particular highlights of 2006
were the over 30% rise in the number of Funds,
including Professional Investor Funds (PIFs),
licensed by the Authority, which grew from one
hundred and forty-nine to two hundred, and the
first successes in the country’s campaign to position
Malta as a global centre for affiliate, or ‘captive’,
insurance services. The first arrivals in this sector
are blue chip concerns from the UK and Germany.
Indeed, an independent survey by a specialist
international insurance industry magazine rated
2
Malta ‘the best up-and-coming captive insurance
jurisdiction in Europe’. The survey also rated Malta’s
accessibility, tailored regulation and cost efficiency
as competitive with the world’s four leading
domiciles for captive insurance.
The growth we anticipated following EU accession
has happened and there has been no let up in the
flow of new business coming to the country.
The Authority sees no short term barriers to
continued growth.
Success brings its own pressures on people and
organisational structures, no less the MFSA. The
Authority, however, benefits greatly from managers
and staff of great quality and I wish to thank them
for their efforts in 2006. I also wish to thank my
fellow Governors, whose experiences, intellectual
skills and dedication to national success serves the
Authority and the country so well.
ASPIRING TO BE WORLD CLASS
That we have done so well is a credit to the people
in the industry and to many others in the public
and private sectors in Malta. The MFSA’s duties in
this area are quite clear. They are on the one hand
to enforce the law, help ensure stability in the
system and help protect consumers and, on the
other, to respond to the needs of the industry with
speed, accessibility, flexibility and efficiency. Those
are qualities to be found in the world’s best
managed businesses and at the MFSA we aspire
to have these qualities. Malta wants to attract only
the best and the MFSA aims to provide the quality
of experience expected by finance industry leaders,
without at any time compromising our authority,
status or integrity. That is what the industry tells
us it wants and it tells us we have a good record
of delivering.
Staying at the top requires many qualities of an
organisation. For a financial regulator the prime
quality is knowledge. Knowing the law of the land
and of the EU, knowing how law and international
agreements are interpreted, knowing the customs
and practices of other countries, knowing in-depth
about the purpose and structures of financial
markets and financial products, knowing when it
is right to say yes and right to say no.
There is a great deal to know and it is incumbent
on the MFSA to make sure that its people have
access to all that they need in terms of research
and IT facilities and in terms of training and
continuing education. Knowledge and training are
at the heart of the MFSA’s strategies for
continuing success.
Since I have been Chairman of the Authority not a
year has passed where I have not urged the industry
to keep investing in training and education. This
year is no different and I believe as strongly as ever
that our finance industry has a bright future only
as long as we have the knowledge, skills and
expertise needed to compete in a very fast
changing world. However, in the past we may have
underestimated the importance of creating a pool
of technically qualified people below
graduate level.
Such people perform vital and important middle-
level functions in the finance industry and we need
more of them if we are to attract more back office
functions and take advantage of organic growth.
Compliance is one of the biggest costs faced by
the finance industry everywhere in the world. No
regulator in a high quality jurisdiction can risk
anything less than rigorous attention to the
compliance task, as we report later in this
document. But much time and money can be saved
when trained staff, working in the financial services
industry, know what needs to be done to meet
high compliance standards. A large pool of
technically qualified people will add greatly to the
functional benefits of the Malta product and be
good for the industry’s customers, good for
consumers, good for the industry itself and good
for Malta.
INFORMATION AND COMMUNICATIONS
It is a measure of both the increased awareness of
Malta’s status as a finance jurisdiction and the
changing nature of global communications, that
the MFSA’s principal website for international
business recorded a daily average of around three
hundred and fifty hits throughout 2006, a year on
year increase of 47%.
The MFSA’s website is also growing as a source of
inquiries, with an average of one new inquiry every
single day of the year. So important has the web
become, that we began planning a major overhaul
of our website in 2006. We will launch the new site
in 2007, with the aim of easier and quicker
navigation and better presentation of information.
While the reach and influence of the internet
continues to grow, the MFSA places great emphasis
on good relations with traditional media,
particularly specialist professional and trade
publications in the financial services field. Financial
services is an industry of almost endless narrow
sub-sets and specialisations. Given sectors may be
narrow and appear obscure to outsiders, but as
markets they are likely to be worth many billions
of euro.
We were therefore pleased to be involved with the
activities of a number of specialist publishing
houses during 2006. These led to excellent media
coverage and to involvement by local firms in
events at Lloyds of London and The London Stock
Exchange. The Authority also provided speakers
for influential events in the UK, France, Germany,
Luxembourg and Sweden and welcomed a number
of EU Commission committees and sub-groups
to Malta.
CONSUMER AFFAIRS
2006 once again saw the Authority increase its
activity in the area of consumer information and
3
 consumer communications and witnessed an
increase in the workload on the Consumer
Complaints Manager. This year, for the first time,
the MFSA has decided to produce the consumer
affairs report as a separate, stand-alone, document.
The document does form part of our legal reporting
to Parliament, but by publishing it separately we
are able to make our work on consumer protection
more widely available to the public. It is an
important piece of communication, which not only
reports in a statistical manner, but also takes readers
through a number of hypothetical case studies,
based on real cases. We believe consumers, media
and the industry will find this approach helpful.
PAN EUROPEAN CO-OPERATION
Bringing about a truly open and universally
beneficial single market in EU financial services
can happen only when there is full, deep and
regular meeting and co-operation between
regulators, policy makers and industry. Details of
the EU and international bodies where the MFSA
is involved with are given in the body of the report.
There are too many to mention here, though suffice
to say that it is work of the highest importance
to Malta.
4
The advances that have been made across the EU
in the past decade have delivered clear benefits to
Malta. Therefore it is essential that we are fully
involved in the relevant groups and committees,
so that our own interests are protected and the
principles of a free and open market are not
undermined. We need to be good Maltese and
good Europeans.
All of our senior regulators were involved with the
EU in their particular areas of expertise and
responsibility, in addition to making contributions
towards the efficient development of
domestic legislation.
ACCORD AND CONFIDENCE
Malta’s finance sector is young, vigorous, ambitious
and dynamic. As a country, we present the world
with a picture of a well managed, capable and
efficient finance jurisdiction and industry. The
country has built its modern finance jurisdiction
on firm foundations and we have good reason to
be confident about the future.
Prof. Joe V. Bannister
Structure and Organisation
 STRUCTURE AND ORGANISATION

Left to right: - Dr. David Fabri, Dr. Anton Felice, Mr. Albert Attard, Mr. Joseph V. Laspina,
Prof. Joe V. Bannister, Mr. Frank Xerri de Caro, Mr. Michael Bonello, Prof. Charles J. Farrugia

Board of Governors

Chairman

Prof. Joe V. Bannister, B.Sc; M.Sc; D. Phil (Oxon)

Members

Mr. Albert Attard

Mr. Michael C. Bonello, M.A (Oxon); FCIB
Prof. Charles J. Farrugia, Ph.D (Lond.)
Dr. Anton Felice, LL.D
Mr. Joseph V. Laspina
Mr. Frank Xerri de Caro, ACIB

Secretary

Dr. David Fabri, LL.D

The Board of Governors is also the Listing Authority

for the purpose of the Financial Markets Act.

6
 Supervisory Council

Chairman

Dr. André Camilleri, LL.D, Dip. Econ. & Ind. Law - Director General

Members

Dr. Marisa Attard, LL.D, ACII, Director – Insurance Business Unit

Dr. Anton Bartolo, LL.D, Director – Corporate Services Unit & Registrar of Companies
Mr. Karol Gabarretta, B.A (Hons.) Econ., M.A (Fin. Serv.), Director – Banking Unit
Ms. Cristina Parlato Trigona, B.A (Hons.) Accty., M.Sc, CPA, ASI, Director – Securities Unit

Secretary

Mr. Brian Borg, B. Accty. (Hons.), M.A (Fin. Serv.), CPA

In Attendance

Dr. Michelle Mizzi Buontempo, LL.D, M.A (Fin. Serv.),

Deputy Director – Company Compliance Unit
Ms. Marianne Scicluna, B.A (Hons.) Banking & Finance, M.Sc (Fin. Reg. & Compliance Mngt.),
Deputy Director – Pensions Unit

Board of Management and Resources

Chairman

Mr. Joseph Demanuele, FCCA, FIA, CPA – Chief Operations Officer

Members

Mr. Charles Theuma, B.A (Hons.) Bs. Mgt., B.Sc, MCL, B.Comm., Consultant /Director – IT & Communications Unit
Mr. Paul Vella, B.A (Hons.) Bs. Mgt., Director – Human Resources and Development Unit
Dr. Michael Xuereb, LL.D, M.A (Fin. Serv.), Director – Business Development Unit
Mr. Charles Zammit, D.B.A.; M.C.M.I.; A.A.I.A., Director – Administration Unit

Secretary

Ms. Alexandra Filletti, B.Comm. (Hons.) Banking & Finance

7
 The Organisation in 2006
The Malta Financial Services Authority (MFSA) was
established by law on the 23 July 2002. It is a fully
autonomous public institution and reports to
Parliament on an annual basis. The MFSA is the
single regulator for the financial services sector
which includes banking, investment exchanges,
insurance, pensions, securities and trustees. The
MFSA incorporates the Registry of Companies and
the Board also acts as the Listing Authority.
The organisational structure of the MFSA (Figure
1) is geared towards the development of a
diversified, competitive and well-regulated financial
services sector being a vital component of the
country’s economic growth and development. To
move forward in this direction the market is
increasingly relying on new technologies and
innovative methods of product and service delivery,
as well as the development and retention of high
value skills and specialisations. These demands will
be further fuelled by competitive pressures driving
companies to seek cost efficiencies and meet
increasingly sophisticated client expectations. To
meet these challenges, the MFSA has during the
year embarked on a detailed internal consultation
process so that it could plan ahead for the future.
Details of the strategic plan were released at the
end of 2006.

Malta Financial Services Authority

Legal and
International Board of Governors
Affairs Unit

Co-ordination Committee

Supervisory Council Board of Management & Resources

Director-General Chief Operations Officer

Figure 1 - Organisation Chart

8
Supervision and Compliance of Licensed Companies
 SUPERVISION AND COMPLIANCE OF
LICENSED COMPANIES
The core function of the MFSA is the supervision
of licence holders and overseeing that they abide
by all applicable regulations. This is implemented
through both off-site and on-site compliance work.
Off-site compliance staff monitor adherence by
licence holders to their prudential requirements
through the review of monthly and quarterly
returns as well as through the review of licence
holders’ audited annual financial statements.
On-site inspections to licence holders’ premises
are also carried out to monitor the extent to which
the operational activity of licence holders adheres
to the regulations imposed.
The MFSA is also moving towards the adoption of
a risk-based approach supervision of licensed
institutions. This is more in line with EU directives
implemented during 2006 and others that will be
implemented in 2007 or thereafter. The number of
compliance visits carried out by sector is presented
in Figure 2.
Figure 2 - On-site Compliance visits
ON-SITE COMPLIANCE
A total of ninety-eight on-site compliance visits
were carried out by the MFSA inspectors during
the year. These included eleven on-site inspections
to credit institutions and five to financial
institutions. Six on-site compliance visits were
carried out to investment services companies while
twenty-six visits were made to insurance
10
companies, broking firms and tied insurance
intermediaries and their respective branches. Fifty
routine on-site inspection visits were conducted
at the premises of licensed nominee companies
and trustees. In general apart from credit and
financial institutions, all licensed institutions are
visited once every one or two years. The application
of the new Trusts and Trustees Act (Cap. 331) during
2006 has necessitated a significant increase in on-
site compliance visits to ensure that the regulations
under the Act are being properly applied.
OFF-SITE COMPLIANCE
The Authority receives financial and statistical
information to conduct effective off-site monitoring
and to evaluate the financial soundness of the
licence holder as well as the local financial
services market.
BREACHES OF ADVERTISING RULES
Thirty-nine breaches of the advertising guidelines
were identified by the Securities Unit and five by
the Insurance Business Unit. Action taken included
reprimanding licence holders and requests for
change to the advertising campaigns.
The Authority is considering whether the time is
appropriate to harmonise the rules regulating
advertising by having one set of rules applicable
to licence holders and authorised firms in all sectors
of financial services.
APPLICATION OF ADMINISTRATIVE PENALTIES
An administrative penalty was imposed on the
author and editor of an article in a local newspaper.
The penalty was imposed in terms of the Prevention
of Financial Markets Abuse (PFMA) Act (Cap. 476)
given that elements of this article breached the
same Act.
A number of administrative penalties were levied
on insurance agents and sub-agents during the
year. Penalties were mainly charged for (i) failure
to comply with directives or orders made or given
under the insurance laws; (ii) failure to enrol persons
in the sub-agents company register; and (iii) the
carrying out of insurance sub-agency activities on
behalf of an insurance company without
registration in the sub-agents’ company register
and enrolment in the sub-agents’ list.
The MFSA Act (Cap. 330) provides for an appeal
from decisions taken by the Authority to an
independent Financial Services Tribunal. The
Tribunal can be requested to determine whether
the Authority in exercise of its decision-making
powers has wrongly applied any of the provisions
of the various financial services laws, as well as
whether certain decisions constitute an abuse of
discretion or are manifestly unfair.
During 2006, two appeals were lodged with the
Tribunal. A third case was sent back to be continued
before the Tribunal following a decision of the
Court of Appeal. The first appeal resulted from a
refusal by the Authority to grant to an applicant
company a licence to conduct activities regulated
under the Investment Services Act (Cap. 370). The
second appeal concerned an alleged change in
the licensing conditions of a licence holder
following the adoption of new performance related
fees for certain types of Collective Investment
Schemes introduced by Legal Notice 239 of 2006.
PREVENTION OF FINANCIAL MARKETS ABUSE
The PFMA Act (Cap. 476) which replaced the Insider
Dealing and Market Abuse Offences Act (Cap. 375)
has the purpose of safeguarding the integrity of
Maltese and European Community Financial
Markets and to enhance investor confidence in
such markets. The MFSA is vested with the function
of enforcing the PFMA regime and safeguarding
the integrity and reputation of the Maltese Financial
Market from malpractices.
To this effect, the MFSA in conjunction with the
Malta Stock Exchange, has been actively
monitoring the market during 2006. The
Securities Unit initiated thirty-five different
reviews/investigations in respect of particular
trading activities. At the end of 2006, twenty-eight
of these reviews/investigations were completed.
PREVENTION OF MONEY LAUNDERING
In the course of its regulation and supervisory
function, the Authority seeks to ensure that licence
holders are fully aware of their money laundering
obligations and that they comply fully in terms of
the law.
Legal Notice 42 of 2006 introduced new
identification obligations and at the same time
widened the list of crimes and subject persons
falling under the Prevention of Money Laundering
Act (Cap. 373) to include auditors, accountants, tax
advisors, real estate agents, notaries, casino
operators and dealers in precious stones or metals.
Subject persons are also required to examine with
special attention the background and purpose of
complex or large transactions, as well as any
transactions that are likely to be related to money
laundering or the funding of terrorism.
The regulations also introduced additional
responsibilities with respect to the recording and
independent verification of payment transactions
and other obligations related to international
correspondent bank ing and corporate
relationships, particularly in the case of
subsidiaries and branches operating in
non-reputable jurisdictions.
The MFSA also acts as agent of the Financial
Intelligence and Analysis Unit (FIAU) in assessing
and ensuring compliance by licence holders on
matters relating to money laundering. The
Authority is represented at meetings of the
Prevention of Money Laundering Joint Committee
by the Money Laundering Reporting Officer.
Officials from the Authority also participated as
part of the Maltese delegation to the Council of
Europe Select Committee of Experts on the
Evaluation of Anti-Money Laundering Measures
(MONEYVAL) as well as the Council of Europe’s
Group of States against Corruption (GRECO).
An MFSA official attended the 27th Plenary Meeting
11
 of GRECO as part of the evaluation team that
prepared the second round evaluation report on
Cyprus while another MFSA official attended the
28th Plenary Meeting of GRECO as rapporteur in
connection with the preparation and examination
of the first round compliance report of the United
States of America.

INTERNATIONAL SANCTIONS

The MFSA is represented on the Sanctions

Monitoring Board, which is established by Legal
Notice 327 of 2006, Sanctions (Monitoring Board)
Regulations, issued in terms of the National Interest
(Enabling Powers) Act (Cap. 365) to monitor the
adherence to regulations imposing sanctions and
other similar measures. Lists of persons and entities
against whom sanctions are imposed in adherence
to UN Security Council Resolutions and EU
Regulations continue to be made available on the
MFSA website.

12
Legislative and Regulatory Developments
 LEGISLATIVE AND REGULATORY
DEVELOPMENTS
During the year under review, the MFSA carried
out a series of consultations with the Financial
Services Consultation Council (FSCC) and where
necessary directly with individual licence holders
and the general public with regards to the
introduction of new legislation and regulations.
The regulatory units together reviewed the
Personal Questionnaire required from individuals
proposed as qualifying shareholders or proposed
to occupy certain positions of trust or to carry out
certain activities with a licence holder or an entity
which has applied to be authorised or licensed by
the MFSA. These individuals have to satisfy the fit
and proper test as defined in the same Personal
Questionnaire. The Securities and Insurance Units
were involved in discussions with the licence
holders for the submission of statistical information.
New statistical requirements in line with Eurostat
and European Central Bank exigencies for all licence
holders were implemented during the year. The
aggregate statistical information is available to the
industry on a consolidated basis.
COMPANY COMPLIANCE
The Authority completed the transposition of the
Takeover Bids Directive 2004/25/EC of the European
Parliament and of the Council of the 21 April 2004
into the Listing Rules. The new Chapter 18 of the
Listing Rules transposing the Directive came into
effect in June 2006.
Work on the Securitisation Bill was finalised and
the Securitisation Act (Cap. 484) was published in
April 2006. The Act provides a comprehensive
framework for the setting up of securitisation
vehicles and regulates the application of a number
of existing laws, including the Companies Act (Cap.
386) and the Civil Code (Cap. 16), in relation to
securitisation.
Following the conclusion of the public
14
consultations during 2005, the revised version of
the Code of Principles of Good Corporate
Governance applicable to listed companies
(Appendix 8.1 of the Listing Rules) was approved
by the Authority and came into effect in June 2006.
The Authority also published in July 2006 new
Corporate Governance Guidelines for Public
Interest Companies.
In December 2006 the Authority issued for
consultation the draft amendments proposed to
the Listing Rules and to the Financial Markets Act
(Cap. 345) to transpose the requirements of
Directive 2004/109/EC of the European Parliament
and of the Council of the15 December 2004. This
directive relates to the harmonisation of
transparency requirements in relation to
information about issuers where securities are
admitted to trading on a regulated market.
In October 2006, amendments to the Trusts and
Trustees Act (Cap. 331) providing for retirement
schemes to be set up as trusts came into effect.
These amendments allow persons registered in
terms of the Special Funds (Regulation) Act (Cap.
450) to provide trustee services to retirement
schemes without further authorisation.
CREDIT AND FINANCIAL INSTITUTIONS
The Authority continued with the process initiated
in 2005 of evaluating the revision to the Banking
Act 1994 (Cap. 371) as well as amendments to a
number of Banking Directives which needed to be
brought in line with the provisions of the Capital
Requirements Directive (CRD) 2006/48/EC of the
European Parliament and of the Council of the14
June 2006 relating to the taking up and pursuit of
the business of credit institutions (Recast) and
Directive 2006/49/EC of the European Parliament
and of the Council of the14 June 2006 on the
Capital Adequacy of Investment Firms and Credit
Institutions (Recast). This comprised the
transposition of those Directives into the Banking
Rules BR/01, BR/02, BR/03, BR/04, BR/06, BR/07,
BR/08, BR/09 and BR/10.
Banking Rule BR/06 has been amended in
conjunction with the Central Bank of Malta to fine
tune certain reporting aspects in line with
regulatory and accounting standards. In addition
the Central Bank of Malta has introduced certain
amendments reflecting European Central Bank
reporting requirements. A series of technical and
information meetings were held with credit
institutions to explain the changes resulting from
the transposition process and to evaluate problems
identified during the parallel run exercise for the
submission of returns by credit institutions carried
out in July 2006.
Credit institutions may adopt the new requirements
which mainly relate to capital requirements and
large exposures at any time during 2007. In the
meantime, until formal adoption of the new
requirements takes place during 2007 (or at the
latest, until 1 January 2008), credit institutions will
continue to implement Banking Directives BD/02
and BD/04 for the purposes of large exposures and
capital requirements, respectively. The conditions
applicable to credit institutions availing themselves
of the transitional period have been included in
Banking Directive BD/02 as Article 61 and BD/04
as Articles 16 and 17.
INSURANCE BUSINESS
The Insurance Intermediaries Act (Cap. 487) came
into force in October 2006. The Act repeals the
Insurance Brokers and Other Intermediaries Act
(Cap. 404) and consolidates the regulation of all
persons carrying out insurance intermediation
activities under one Act. It also implements the
provisions of Directive 2002/92/EC of the European
Parliament and of the Council of the 9 December
2002 on insurance mediation (the Insurance
Mediation Directive).
The various intermediation activities established
under the Act can now be carried out by either
individuals or legal entities. The European Passport
Rights for Insurance Intermediaries Regulations
published under Legal Notice 35 of 2005 provides
for cross-border insurance intermediation activities.
The minimum limits of professional indemnity
insurance have been revised to reflect the amounts
required by the Insurance Mediation Directive. As
a result of these changes, Maltese insurance
intermediaries can place contracts of insurance
with companies authorised under the Insurance
Business Act (Cap. 403) and also with European
insurance undertakings passporting their services
to Malta.
The promotion and selling of Linked Long Term
Contracts of Insurance (LLTCIs) as from January
2007 will be regulated solely under the Insurance
Business Act (Cap. 403) as a result of the
amendments introduced in Article 6 of the same
Act. This change in the regulatory regime was
deemed necessary in view of the fact that Directive
2002/83/EC of the European Parliament and of the
Council of the 5 November 2002 concerning life
assurance classifies LLTCIs as long term contracts
of insurance.
The MFSA is in the process of changing the
Insurance Directives and Insurance Intermediary
Directives to Insurance Rules and Insurance
Intermediary Rules. In September and November
2006, two separate notes for consultation were
circulated to the insurance licence holders in
respect of Insurance Intermediaries Rules and
Insurance Rules which were being issued under
the Insurance Intermediaries Act (Cap. 487) or the
Insurance Business Act (Cap. 403). The following
Insurance Intermediaries Rules and Insurance Rules
were issued in December 2006 and will come into
force on the 1 January 2007:
15
 • Insurance Intermediaries Rule 1 of 2007 – Own
Funds of Persons Enrolled in the Agents List,
Managers List or Brokers List Carrying out
Insurance Intermediaries Activities;
• Insurance Intermediaries Rule 3 of 2007-
Disclosure of Information for Clients;
• Insurance Intermediaries Rule 13 of 2007 -
Monies Held in a Fiduciary Capacity;
• Insurance Intermediaries Rule 14 of 2007 –
Fidelity Bonds;
• Insurance Intermediaries Rule 18 of 2007 –
Business of Insurance not subject to Tied
Insurance Intermediaries Activities;
• Insurance Rule 1 of 2007 - Own Funds of
Companies Carrying on Business of Insurance;
• Insurance Rule 3 of 2007 – Information for
Policyholders.
Amendments were made to Insurance Directive
12 of 1999 on the Business of Insurance Statements.
This Directive was issued in February 2006 and
came into force in March 2006. The submission
forms were amended to reflect the financial
requirements of insurance legislation. The First
Schedule includes the statements for insurance
companies and has been divided into eight main
parts. These shall have effect in respect of business
of insurance statements which companies are
required to complete in relation to the calendar
year of companies which begin on or after the 1
January 2006.
Various Notes for Consultation and Explanatory
Notes have been circulated during the year in
relation to the various Legal Notices issued
pursuant to the Insurance Business Act (Cap. 403)
and Insurance Intermediaries Act (Cap. 487) (see
Table 1 and 2).
16
Table 1
Legal Notices published under the
Insurance Business Act
Legal Notice Insurance Business (Long Term
115 of 2006 Business Contract Statutory Notice)
(Amendment) Regulations, 2006
Legal Notice Repeal of Lloyd’s (Recognised
228 of 2006 Insurance Body) Order 2006
Legal Notice Insurance Business (Companies
240 of 2006 A c c o u n t s ) ( A m e n d m e n t )
Regulations, 2006
Legal Notice I n s u r a n c e B u s i n e s s ( F e e s )
255 of 2006 (Amendment) Regulations, 2006
Legal Notice Insurance Business (Long Term
321 of 2006 Business Contract Statutory Notice)
(Amendment) Regulations, 2006
Legal Notice Insurance Business (Insurers' Assets
324 of 2006 and Liabilities) (Amendment)
Regulations, 2006
Table 2
Legal Notices published under the
Insurance Intermediaries Act
Legal Notice Insurance Intermediaries Act (Act
180 of 2006 No. XII of 2006) - Notice of coming
into force
Legal Notice Insurance Intermediaries (Fees)
256 of 2006 Regulations, 2006
Legal Notice Insurance Intermediaries
319 of 2006 (Transitional Provisions) Regulations,
2006
Legal Notice Insurance Intermediaries
326 of 2006 (Exemption) Regulations, 2006
PENSIONS
In February 2006, the MFSA issued for consultation
the passporting and exemption regulations, in
connection with the implementation of the
Directive on the activities and supervision of
Institutions for Occupational Retirement Provision
2003/41/EEC (the EU Pensions Directive) of the
European Parliament and of the Council of the 3
June 2003. The new regulations completed the
transposition of the EU Pensions Directive. The
MFSA’s directives for Occupational Retirement
Schemes, Retirement Funds and related parties
under the Special Funds (Regulation) Act (Cap. 450)
(the SFA directives) were also amended to reflect
the changes introduced by the new regulations.
In May 2006 the Authority issued a Feedback
Statement regarding the feedback received in
relation to the new regulations and also issued for
consultation various amendments to the Special
Funds (Regulation) Act (Cap. 450) and to the SFA
directives which are intended to cater primarily for
the establishment of Retirement Schemes in the
form of trusts. The amendments to cater for the
establishment of Retirement Schemes as trusts
came into force in October 2006. Table 3 shows the
Legal Notices issued in 2006 under the Special
Funds (Regulation) Act (Cap. 450).
Table 3
Legal Notices published under the
Special Funds (Regulation) Act
Legal Notice Special Funds (Regulation) Act
71 of 2006 (European Passport Rights for
Institutions for Occupational
Retirement Provision) Regulations,
2006
Legal Notice Special Funds (Regulation) Act
72 of 2006 (Exemption) Regulations, 2006
SECURITIES
Markets in Financial Instruments Directive (MiFID)
MiFID, Directive 2004/39/EC of the European
Parliament and of the Council of the 21 April 2004
will be introduced under the Lamfalussy procedure.
Level 1 establishes the guiding principles of the
legislation agreed in co-decision by the European
Parliament and the Council and Level 2 gives the
technical implementing measures rendering the
Level 1 principles operational. The Level 2 measures
have been adopted by the EU Commission.
MiFID replaces the Council Directive 93/22/EEC of
the 10 May 1993 on Investment Services in the
Securities field (Investment Services Directive),
which will be repealed in November 2007. The new
Directive is a central element of the Commission’s
Financial Services Action Plan and introduces a
comprehensive regulatory regime covering
investment services, trading platforms (including
regulated markets, multilateral trading facilities
and systematic internalisers) and financial markets
in Europe. It was formulated with the ultimate aim
of opening up Europe’s capital markets by
improving the price transparency of traded
financial instruments, while making it easier to
execute trades across borders.The objectives of
MiFID are to enable investors to invest and procure
investment services across EU borders more easily,
to remove obstacles to the use of the EU passport
by investment firms, to foster competition and a
level playing field between Europe’s trading venues,
and to ensure appropriate levels of protection for
investors and consumers of investment services
across Europe.
In May 2006, the Authority issued a circular to
provide the financial services industry with an
overview of MiFID and recent developments
relative to this Directive and to provide a tentative
timetable for the completion of its transposition
and implementation within the established
EU deadlines.
Another four circulars on MiFID were issued by the
Authority up to December 2006. The second circular
issued in October 2006 referred to the Level 2
Implementing Measures and brought to the
attention of the industry the Committee of
European Securities Regulators (CESR) consultation
document on the list of minimum records to be
17
 kept by investment firms in terms of Article 51(3)
of the Directive. The third circular issued in
November 2006 was the first consultation
document to the industry outlining the proposed
amendments to a number of Sections of Part C I
of the Investment Services Guidelines. The fourth
circular issued in December 2006 served as the
second consultation document dealing with the
transposition/implementation of the transaction
reporting requirements. This circular also served
to draw the industry’s attention to the CESR
consultation document on transaction reporting.
The fifth MFSA circular also issued in December
2006 draws the industry’s attention to two other
consultation documents issued by CESR in the
fields of passporting and inducements.
Prevention of Financial Markets Abuse
The Securities Unit noted that there was still some
uncertainty as to who should submit notifications
under the PFMA Act (Cap. 476) and under what
circumstances such notifications should be made.
Consequently the Authority issued a circular in July
2006 aimed at providing guidelines to persons
who hold managerial responsibilities within an
Issuer. In August 2006, an additional circular was
issued by the Authority on the monitoring and
reporting duties of persons professionally arranging
transactions in financial instruments. This circular
provides guidance on the relevant obligations
under the PFMA Act (Cap. 476).
A circular was issued to all board secretaries of
listed companies in March 2006 clarifying the
definition of ‘insider’ and the manner in which the
List of Insiders is to be compiled and updated.
In April 2006, a circular regarding the dissemination
of financial information in the local press was
published. The circular provides a background on
local market abuse legislation and briefly explains
what constitutes market abuse and has the purpose
of drawing attention of the local media to the
provisions of the PFMA Act (Cap. 476) and
subsidiary legislation which should be in mind
when reporting financial information.
18
Linked Long Term Contracts of Insurance (LLTCIs)
A circular for consultation was issued on the 2
March 2006 in connection with the selling and
promotion of LLTCIs. Legal Notices (see Table 4)
were published to transfer the regulation of LLTCIs
from the Investment Services Act (Cap. 370) to the
insurance regulatory framework with effect from
1 January 2007.
Table 4
Legal Notices published under the Companies Act,
Investment Services Act and Financial Markets Act
Legal Notice Investment Services Act – Investor
36 of 2006 Compensation Scheme
(Amendment) Regulations, 2006
Legal Notice Financial Markets Act – Notice of
75 of 2006 coming into Force of the Transfer
of Listed Securities Regulations,
2004
Legal Notice Investment Services Act (Linked
117 of 2006 Long Term Contracts of Insurance
Statutory Notice) (Amendment)
Regulations, 2006
Legal Notice I n v e s t m e n t S e r v i c e s A c t
239 of 2006 (Performance Fees) Regulations,
2006
Legal Notice Companies Ac t (I nvestment
241 of 2006 Companies with Variable Share
Capital) Regulations, 2006
Legal Notice I n v e s t m e n t S e r v i c e s A c t
318 of 2006 (Amendment of the Second
Schedule) Regulations, 2006
Legal Notice Repeal of Investment Services Act
320 of 2006 (Linked Long Term Contract of
I nsurance Statutor y Notice)
Regulation, 2006
Legal Notice Investment Services Act (Licence and
322 of 2006 Other Fees) Regulation, 2006
Collective Investment Schemes (CISs)
Explanatory Notes relating to the licensing of
overseas based non-UCITS (Units for Collective
Investments in Transferable Securities) collective
investment schemes carrying out an activity in or
from Malta in terms of Article 4 of the Investment
Services Act (Cap. 370) were circulated to licence
holders. The notes mainly related to the licensing
criteria.
New regulations were issued in September 2006
under the Companies Act (Cap. 386) concerning
Investment Companies with Variable Share Capital
(SICAVs) replacing the previous SICAV regulations.
These regulations were updated principally to cater
for certain industry developments and more
importantly to streamline the provisions applicable
to Schemes which have not established any sub-
funds with those applicable to Schemes with sub-
funds. These include the new definition for SICAVs,
the clearer distinction between SICAVs with and
without sub-funds and the provision for classes
representing sub-funds.
The MFSA has continued with the development of
PIFs regime. It is expected that early in 2007 the
MFSA will issue draft guidelines extending the PIFs
regime to a new class targeting Extraordinary
Investors.
A feedback statement was issued in January 2006
in response to comments received from the
industry after the original publication of the
Property Funds Policy. The statement included an
outline of the main comments received in respect
of the Policy, the MFSA’s comments in their regards
and an updated policy wording. This was published
together with the feedback statement
mentioned above.
During January 2006, responses in respect of the
proposed new standard licence conditions relating
to performance fees were received. These were
reviewed and published by way of regulation in
terms of Article 12 of the Investment Services Act
(Cap. 370). The respective Legal Notice 239 of 2006
was published in October 2006.
Capital Requirements Directive (CRD)
A consultation document was issued in December
2006 to investment services licence holders on
amendments to the Investment Services Guidelines
relating to the transposition of the Capital
Requirements Directive 2006/49/EC. The document
explains the approach to be undertaken by the
Authority in transposing the Directive and the new
financial resources requirements.
COMPANY LAW
Directive 2006/43/EC entitled Statutory Audits of
Annual Accounts and Consolidated Accounts has
replaced the original 8th Directive with effect from
the 29 June 2006. The Directive widens the scope
while maintaining many provisions of the original
Directive. The new Directive contains detailed
provisions regarding (i) conditions for approval of
auditors; (ii) professional ethics, independence,
objectivity, confidentiality   and professional
secrecy; (iii) the obligations of Member States to
create a system of public oversight of auditors; and
(iv) appointment and dismissal of auditors. This
Directive will be transposed by June 2008. The
Authority is co-ordinating and liaising with the
Accountancy Board and the Malta Institute of
Accountants regarding its implementation.
19
International Affairs
INTERNATIONAL AFFAIRS
INFORMATION EXCHANGE
The MFSA has signed a number of Bilateral
Memoranda of Understanding (MoUs) with foreign
counterparts with the aim of facilitating the
exchange of regulatory information and to create
a formal framework for regulatory collaboration
and co-operation.
During 2006, the Authority signed two MoUs. The
first was signed with De Nederlandsche Bank N.V.
(DNB) and covers co-operation and exchange of
information in the field of prudential supervision
of banks, their cross-border establishments and
the provision of services. The second MoU was
signed with the Banking, Finance and Insurance
Commission (CBFA) of Belgium and is aimed at
closer co-operation in the sphere of supervision of
credit institutions. Negotiations are currently
underway with other overseas financial services
regulators for the purpose of entering in new MoUs.
Profs J.V. Bannister, MFSA Chairman and
Prof A. Schilder, DNB Executive Director
The MFSA had formally lodged an application, in
April 2005, and communicated its willingness to
endorse the commitment to cross-border
co-operation in accordance with the International
Organisation of Securities Commission’s (IOSCO)
Multilateral Memorandum of Understanding
(MMoU) concerning Consultation and Co-operation
and the Exchange of Information. The MFSA’s
application was accepted in February 2006 and
the MMoU was signed in April 2006.
The MMoU is an essential tool in the ambitious
task of strengthening the capital markets against
financial fraud. This document underscores the
importance being attributed to mutual co-
operation and consultation by IOSCO members
and their increased willingness to provide mutual
assistance to facilitate the exercise of their
respective functions and responsibilities in the
securities field.
A list of the various Bilateral and Multilateral MoUs
currently in force is presented in Appendix A.
In May 2005, the Memorandum of Understanding
on Co-operation between the Banking Supervisors,
Central Banks and Finance Ministries of the
European Union in Financial Crisis Situations was
signed. As part of the national initiative pursuant
to Financial Crisis Situations, the Malta Financial
Services Authority, the Central Bank of Malta and
the Ministry of Finance set up a high level working
group to prepare a financial crisis framework. The
group met twelve times during 2006 and discussed
a number of issues relating to the setting up of a
domestic framework for crisis management. The
group also took part in a simulation exercise
organised by the Economic and Financial
Committee of the European Commission which
included representatives from signatories of EU
Member States.
EU WORKING COMMITTEES AND
INTERNATIONAL FORA
The MFSA participates in a number of Committee
Meetings and Working Groups involving EU
Member States. During the year, officials involved
in the regulation of Banking, Insurance, Securities,
Pensions and Company Compliance within the
MFSA participated in the plenary meetings
(Chairman and/or the Director General) and on
various working groups (staff from the respective
regulatory units) of the Committee of European
21
 Securities Regulators (CESR), the Committee of
European Banking Supervisors (CEBS), the
Committee of European Insurance and
Occupational Pensions Supervisors (CEIOPS), the
Company Law Expert Group (CLEG) and the
Group de Contact.
The MFSA is represented by the Banking Unit on
the following working groups under the auspices
of CEBS: the Financial Conglomerates Working
Group, the Expert Group on Financial Information,
the Expert Group on Large Exposures, the Working
Group on Supervisory Disclosure Taskforce, the
Expert Group on Capital Requirements, the Working
Group on Convergence Task Force, the Working
Group on Own Funds, the Capital Requirements
Directive Transposition Group, the Expert Group
on E-Money, the Working Group on Large
Exposures and the Network on Validation Issues.
The Banking Unit is also represented on the Capital
Requirements Directive Transposition Group. The
Banking Unit has on an ongoing basis been
required to provide feedback and suggestions
regarding various specific issues related to the CRD
and its forthcoming implementation in January
2007. These issues included matters relating to
technical details for the calculation of the capital
requirement, as well as transposition and
interpretation issues.
The Group de Contact which is also a working
group under the auspices of CEBS held one of its
quarterly meetings in Malta in early May 2006.
The Group’s purpose is to promote practical
co-operation and the exchange of
confidential information between European
banking supervisors.
The Supervisory Board of the Central Bank of
Estonia visited Malta during the month of April.
The delegation paid a visit to the MFSA and held
meetings with officials regarding the Authority’s
role in the financial sector.
As a member of CEIOPS, the Authority completed
questionnaires in relation to the impact of Solvency
II. Similar questionnaires submitted by the
22
International Association of Insurance Supervisors
(IAIS) were also completed. As part of the
consultation process on Solvency II, the MFSA
invited Mr Karel Van Hulle, Head of the Insurance
and Pensions Unit of the European Commission to
give a presentation on the challenges posed by
the proposed Solvency II Directive.
The MFSA is represented by the Insurance Business
Unit in the following working groups under the
auspices of CEIOPS: the Insurance Intermediaries
Working Group, the Insurance Groups Supervision
Committee and the Work ing Group on
Solvency II. The Pensions Unit participates in the
CEIOPS Pensions Working Group. The Insurance
Business Unit is also a member of the IAIS and
participates in the Technical Committee and
Insurance Contracts Sub-Committee.
The MFSA is represented by the Securities Unit on
the CESR MiFID Level 3 Expert Group and primarily
as observer on this Expert Group’s Markets and
Intermediaries Sub-Groups. The Securities Unit also
participates in meetings of the CESR Review Panel,
CESR-Tech and the Surveillance & Intelligence
Group of CESR-Pol.  Moreover, Securities Unit
representatives have also attended transposition
meetings organised by the EU Commission
regarding the CRD and MiFID.
In March 2006, the quarterly meeting of CESR-Pol
was held in Malta for the first time. CESR-Pol is a
permanent operational group within CESR and
reports regularly to CESR on the activities of the
group. CESR-Pol’s key objective is to make cross-
border information flow equally rapidly amongst
CESR members and therefore enhancing the
transparency, the fairness and the integrity of the
European markets as a whole.
The Authority also participated in other committees
and working groups. These are the EU Company
Law Expert Group, the European Commerce
Registers Forum, the Council of Europe MONEYVAL
and the Joint Committee on the Prevention of
Money Laundering.
Human Resources Development
 HUMAN RESOURCES DEVELOPMENT
The Authority regards the training of its personnel
and of people employed in the finance industry as
critical to the quality of service and growth in the
sector. During 2006, the Authority met a number
of trade and professional bodies in order to identify
training needs and assist in the industry’s training
programmes.
With the continuous increase in staff members
(Figure 3) greater emphasis is being given to staff
development and training. During 2006, technical
and general training was periodically offered to
staff members. The concluding phase of the
Employee Assistance Programme run by Caritas
Malta was delivered. This programme comprised
of a series of intensive life and management skills
training sessions.
Figure 3 - MFSA Staff Complement
The Authority’s middle management participated
in an intensive two day residential workshop on
Management Skills run by an internationally
recognised expert in this area. In addition MFSA
staff members regularly attend the programmes
organised for the industry as part of their training.
The number of graduates within the Authority
continued to increase during 2006 (Figure 4). Three
staff members successfully completed their studies
through the Self Development Scheme and
24
obtained the ACCA, MA and Diploma in Insurance
while another twelve commenced studies in
various courses, namely MBA, ACCA, MA, MSc and
various Diplomas in Taxation, Training and
Development, Trust Management and Compliance.
As at the end of December 2006, thirty-one staff
members were undergoing self development
studies in Malta and abroad.
Figure 4 - Number and Type of Qualifications held by
MFSA Employees
A member of the Insurance Business Unit gained
first hand regulatory experience at one of the top
London reinsurance brokerage firms through a
placement scholarship granted by the Lord Mayor
of The City of London under The Mansion House
Scholarship Scheme.
The programme of courses and seminars (Table 5)
held during 2006 covered a wide range of subjects
within the ambit of financial services. These
included company law, the changeover to the euro
and its implications for licence holders, issues
related to trusts and trustees and technical topics
related to investment services and insurance.
These programmes were jointly organised with
the Institute of Financial Services (Malta), the
Association of Insurance Brokers, the Institute of
Legal Studies, the Institute of Financial Services
Practitioners and the Malta International
Training Centre.
 Table 5
Industry Training Programme 2006
Course/Seminar
Overview of the Insurance Intermediaries Act 2006
Investment Services Course
Solvency II - Future Perspective
detect and prevent attempts to utilise various
aspects of the economy to facilitate money
laundering. This body of legislation has been
reinforced by the new regulations implementing
the Third European Directive on Anti-Money
Laundering, Directive 2005/60/EC of the
European Parliament and of the Council of the
26 October 2005.

International Aspects of Maltese Company Law

Converging to Euro - Understanding the Practical

& Technical Aspects

Company Law Course

Anti-Money Laundering Training Programme

The Impact on Legal Practices of the New Civil Code

Provisions on Life Insurance
Company Law Course III
Insurance Brokers - Compliance Training
Programme
Integration of the Maltese Financial Services in the
EU Framework
In May 2006, the Authority in collaboration with
the FIAU, the Malta Lotteries and Gaming Authority
and the National Association of Securities Dealers
(NASD) UK Branch held a training programme on
anti-money laundering. The programme gave
participants an excellent opportunity to hear from
industry practitioners in Malta, the United Kingdom
and the United States about the approach to this
highly important issue. Market participants are
subject to increased responsibilities to take
appropriate steps to detect and prevent money
laundering. Malta’s anti-money laundering regime
includes two important pieces of legislation in line
with European directives and other international
standards: The Prevention of Money Laundering
Act (Cap. 373), and the Prevention of Money
Laundering and Funding of Terrorism Regulations.
Both are representative of Malta’s strong
commitment to building a robust framework to
Training programmes have proved to be beneficial
for continuous professional development and have
served as a forum for participants to discuss
periodic regulatory developments and the
implications of new financial services products
and services.
The first programme leading to the attainment of
a recognised ‘Accounting Technician’ qualification
was held during 2006 following the preparatory
work carried out with the Institute of Business and
Commerce within the Malta College of Arts Science
and Technology. The programme will be repeated
in 2007 and is partly funded through the European
Social Fund.
The MFSA also contributed to career oriented
events organised in a number of secondary schools
and received periodic organised visits by different
categories of students within the scope of their
financial services related studies.

25
Business Development Overview
BUSINESS DEVELOPMENT OVERVIEW
From a business perspective further developments
have taken place notably in the investment services,
insurance and trust sectors. An area that has also
attracted attention is that related to the setting up
of cross-border occupational pensions schemes,
particularly following developments in the
regulatory framework that have allowed such
schemes to be set up as trusts and the introduction
of a framework for pension ‘pooling’ vehicles.
In the funds sector, Malta has continued to develop
rapidly as a funds domicile, particularly for PIFs as
the framework has proved its flexibility in attracting
both the large and small caps, as well as single-
and multi-strategy funds. In the course of the year
the net asset value of locally-based collective
investment schemes rose to nearly five billion euro
as the number of funds increased by fifty-two to a
total of two hundred at the end of the year.
The MFSA has in the meantime worked to ensure
that fund servicing activity finds the right legal
environment and market infrastructure to operate
effectively at an international level.  The Authority
has closely followed issues of concern to this
industry in the specialised media and through
industry conferences and discussions with
international operators and professionals in the
field.  This has provided the required insight to be
able to better evaluate and address these issues
as they unfold. New licences issued to asset
managers originating from Switzerland, the
Netherlands and the United Kingdom, and the
recognition granted to a third party fund
administrator from the Netherlands, are a clear
sign that Malta is providing the right environment
for high value fund servicing activity to develop.
Malta’s emergence as an important European
domicile for affiliate (captive) insurance activities
was highlighted by independent research findings
published in Reactions Magazine in May 2006. This
survey confirmed Malta as the best up-and-coming
captive insurance jurisdiction in Europe. Malta’s
accessibility, tailored regulation and cost efficiency
also earned it a mention alongside the best four
established captive domiciles in the world. 
The insurance sector has this year registered six
new companies. A number of insurance companies
have either started or will be providing cross-border
insurance services from Malta to twenty-two EU
Member States. In the meantime, the arrival of
three new insurance management companies
alongside six others already licensed to operate in
Malta has further strengthened the country’s
capabilities and expertise in this growing area of
business. It is also encouraging to note that a good
number of these management operations have
been set up in conjunction with local insurance
providers seeking to internationalise and diversify
their operations through innovative channels and
the acquisition of new expertise.
Trust services have also received a boost this year
through the authorisation of thirteen new trustees,
among which are a number of international trust
management groups.  The Society for Trust and
Estate Practitioners (STEP) launched its Malta
Branch in October 2006, stating that the twelve
thousand member strong society was keen to
increase its presence in civil law jurisdictions and
that Malta’s new trust law and legal system, which
drew on both common law and civil law, offered
great scope for attracting international
trust business.
Official launch of STEP Malta Branch
27
 A number of factors have continued to contribute
to the overall competitiveness and growth of the
financial services sector during the year. The
continued nurturing of this environment should
result in a broader based market in which
companies can compete effectively on the basis
of their particular strengths and market niches.
This should in turn contribute positively to the
soundness, resilience and dynamism of the market,
leading to a greater choice and a higher quality of
products and services available to consumers.
Against this background the Authority has
continued to interact with the local and
international financial services community with
the aim of developing synergies that stimulate
product development and growth.  This has been
done through continuous updating of
communication tools, interaction with the industry
media and involvement in local and international
events and workshops.   in the United Kingdom with an insight into Malta’s
The MFSA’s framework Guides to establishment
and management of different types of financial
services business have undergone substantial
upgrading, particularly in the case of the Guide to
Professional Investment Funds and the Guide to
the Enrolment of Insurance Intermediaries. A Guide
to the Registration of Companies as well as a leaflet
on the use of the MFSA’s online registration system
were launched during the year, while work on the
publication of new Guides on Occupational Pension
Schemes and Fund Administration also reached
an advanced stage. All Guides are available in the
Publications section on the MFSA website.
28
In June 2006, the MFSA in conjunction with Hedge
Funds Review researched and produced a Malta
Hedge Fund Supplement covering the state of
development of the professional investor and
hedge fund industry.  The publication has been
widely sought by operators as a quick reference
guide to Malta as a funds domicile and was also
distributed at leading industry events such as GAIM
held in Cannes, France in July 2006 and the Hedge
Fund Summit in London in October 2006.
The MFSA participated in two international events
in the City of London, one entitled ‘Banking and
Investment in Malta’ held in April 2006 at the
London Stock Exchange in association with FT
Business, and another entitled ‘Insurance and
Reinsurance in Malta’ held in November 2006 in
association with Global Reinsurance at Lloyds of
London. Both events were very well-attended and
served as an opportunity for providing institutions
financial services framework as well as a platform
for strengthening existing links between the
two jurisdictions.
Panel at Lloyds in London
During 2006, the MFSA also accepted invitations
to speak at a number of high profile events
including the Transfer Agency Forum, held in
Luxembourg, and the Luxembourg Rendezvous
on captive insurance.  It also participated in client
workshops organised by Dechert LLP in London,
by Aon Insurance Managers in London, Mulheim,
Amsterdam and Paris, by Willis BV held in
Amsterdam and by the Health Lambert Group at
their London headquarters.
The MFSA gave a number of presentations during
the annual conference of the Associazione
Nazionale Direttori Amministrattivi e Finanziari
(ANDAF) which was held in Malta. Other meetings
held by various international and regional networks
in Malta, Leipzig, Hamburg and Stockholm were
also addressed by the MFSA officials during
the year.
Panel during the Vodafone
Economic Forum in Malta
The Vodafone Economic Forum and other
conferences held in Malta also served as a platform
for the MFSA to update the industry on the trends
and developments in financial services business,
particularly in captive insurance and hedge fund
business both in Malta and internationally.
The MFSA also accepted an invitation from the
Association of the Luxembourg Fund Industry to
attend the ALFI Annual Conference in March 2006.
The conference was addressed by top officials from
the European Fund and Asset Management
Association (EFAMA), the European Commission
Asset Management Unit, the Committee of
European Securities Regulators and other industry
speakers.
Throughout the year the Authority’s research
department continued to monitor international
business trends and perceptions in the
international media. The specialised industry media
was also updated regularly on various
developments in the sector through interviews,
newsletters and other briefings.  News reports and
features on Malta’s financial services industry were
carried in, among others, The Economist, STEP
Avanti Magazine, Lloyds List, Reuters Hedgeworld,
Hedge Funds Review, Global Reinsurance, Portfolio
International, Captive Review, International
Investment, Rivista ANDAF, Fortune Magazine, The
Banker, The Business, Hedgeweek, IPE.com,
International Advisor and Institutional Investor’s
Daily IITV.
Euro Changeover
The MFSA’s internal euro changeover working
group continued with its preparations by attending
various meetings of the Financial Services Euro
Changeover Committee. At the same time the
internal working group continued with its analysis
of all documentation and kept the Supervisory
Council and the Board of Management and
Resources informed so as to identify the necessary
changes which should be implemented within the
MFSA. The group reported directly to the Co-
ordination Committee on a quarterly basis. The
group attended several meetings with the
associations represented on the FSCC and with the
National Euro Changeover Committee (NECC).
Guidelines aimed at ensuring a smooth transition
to the conversion of company share capital from
the Maltese Lira to the euro were issued by the
MFSA in May 2006 following their approval by the
NECC. The planned conversion of company share
capital to the euro on 1 January 2008 is expected
to require the least possible intervention and
processing of documentation by all companies
involved. The guidelines published as document
NECC/0006/2006 apply to all registered companies
which have their share capital denominated in
Maltese Lira as at the end of December 2007. All
the above is subject to the overriding condition
that the euro changeover will take place on 1
January 2008.
29
 LICENSES ISSUED
Credit and Financial Institutions
During 2006, no new licences were issued to credit
and financial institutions. The number of credit
institutions decreased from nineteen at the end of
2005 to eighteen due to the merger of HSBC Home
Loans (Malta) Ltd into HSBC Bank Malta plc
(Table 6).
The banking sector continued to grow during 2006.
The aggregate balance sheet totals for licensed
credit institutions went up from Lm8.8 billion in
2004 to Lm12.6 billion in 2006, an increase of
43.19% over two years. Deposit liabilities increased
by Lm1 billion or 20% for the same period. On the
other hand net loans increased by Lm2 billion or
48.8%. The data in Figure 5 indicates that the
licensed credit institutions are continuing to grow
indicating a healthy operating environment.

Table 6 Insurance Business

Number of Credit and Financial Institutions
The insurance sector continued to maintain a
December December December
2004 2005 2006 steady growth as in previous years. The year under
review was characterised by a further increase in
Credit 17 19 18 the number of licensed insurance companies and
Institutions insurance managers. There was also a substantial
increase in the number of Tied Insurance
Financial 12 13 13 Intermediaries (formerly known as sub-agents) as
Institutions
well as increases in the number of institutions and
Representative 1 1 1 individuals registered under the Brokers List and
Offices the Brokers Register respectively.

As from October 2006, the policy regarding the
sale of insurance products by credit and financial
institutions was revised. These institutions can now
act as tied insurance intermediaries for four classes
of general insurance business besides life insurance
business. These are Class 14 – restricted to export
credit contracts of insurance and Classes 1, 2 and
16 – restricted to payment protection contracts of
insurance issued in relation to loan repayments.
14
12
Insurance Companies
The Authority issued six new licenses to insurance
companies to write third party business in various
classes of insurance. Propgen Insurance Ltd was
authorised to carry on business restricted to risks
situated outside Malta in Classes 1, 2, 8, 9, 13, 16
and 17. Caversham Insurance (Malta) Ltd was
granted authorisation to carry on business of
insurance restricted to risks situated outside Malta
in the general business Class 16 while Central Life
Ltd was licensed to carry on business restricted to

10
commitments where Malta is not the country of
LM billions

8
the commitment in Class 1. Saint John’s Insurance
6
Ltd was authorised to carry on business of
4
insurance in Classes 2 and 13, Practice Plan
2
Insurance Ltd in Classes 1, 2 16 and 18 and Multi
0 Risks Benefits Ltd in Classes 1, 2 and 4.
2004 2005 2006*
*Figures for 2006 are provisional

Figure 5 - Aggregate Figures for Licensed Credit

Institutions

30
 Table 7
Number of Insurance Licence Holders

Category 2006

Local Insurers 17

Foreign Insurers 3

Affiliated Insurance Companies 5 Figure 6 - Local and Foreign Companies Authorised to

carry on Insurance Business in Malta
Protected Cell Companies 1
Insurance Managers
Insurance Managers 9
The increase in the number of Insurance Managers
Agents of : Local Insurers 9 registered during 2005 continued in 2006 with the
licensing of three new insurance managers, namely
Foreign Insurers & 12 HSBC Insurance Management (Malta) Ltd,
European Insurance Alternative Risk Management (Malta) Ltd and
Undertakings Heritage Insurance Management (Malta) Ltd.

Insurance Brokers – Companies 23

Insurance Brokers – Individuals 54
Tied Insurance Intermediaries 567
Foreign insurers refer to insurance undertakings with head office outside the EU/EEA
Member States and which hold an authorisation under the Insurance Business Act
(Cap. 403) and one European Insurance Undertaking which has not yet passported
into Malta.
One company, namely Orlen Insurance Ltd, was
licensed as an affiliated (captive) insurance
company to carry on business of affiliated insurance
situated outside Malta in Classes 8, 9 and 16.
Authorisation was also granted to Atlas Insurance
Ltd to convert into a Protected Cell Company. Table
7 gives a breakdown of the insurance licences by
category as at December 2006.
Insurance Agents
During the year, SMS Insurance Agency Ltd was
granted authorisation to act as insurance agent for
Wurttembergische Versicherung Aktiengesellschaft
in Class 7, Faraday Reinsurance Co Ltd in Class 13,
Catlin Insurance Company (UK) in Classes 7, 8, 9
and 10, Gerling at Lloyd’s Syndicate (1206) in Classes
1, 2, 7, 8, 9 and 16 and Lloyd’s Syndicate (1886 Part
of Umbrella Syndicate 2999) in Classes 3 and 10.
Fogg Insurance Agencies Ltd was granted
authorisation to act as an insurance agent in
additional classes for Norwich Union International
Insurance Ltd. Fenici Insurance Agency ceased to
act as an insurance agent for Middlesea
Insurance plc.
Insurance Brokers

Figure 6 indicates the total number of local and First Insurance Brokers Ltd and United Insurance
foreign insurers as well as the shift between local Brokers Ltd merged their insurance broking
and foreign insurers authorised to carry on business operations. Azzopardi Insurance Brokers Ltd ceased
in Malta which occured between 2000 and 2006. voluntarily to carry on broking activities.

31
 Investment Services

During the year the MFSA issued new Investment

Figure 7 - Authorised Insurance Brokers
HSBC International Financial Advisers (Malta) Ltd
and KDM Insurance Brokers Ltd were enrolled in
the Brokers List whilst eighteen individuals were
registered in the Brokers Register during 2006.
Other individuals and institutions were struck off
from both Brokers List and Register on a voluntary
basis as at the end of 2006. Registered individual
insurance brokers amounted to fifty-four whilst
there were twenty-three enrolled brokering
firms (Figure 7).
Services licences to Universal Financial Services Ltd
and Swiss Administration Centre Ltd as Category
1a, to Amstel Capital (Malta) Ltd, Tell Investment
CP, Tell Capital Ltd and Altegde Capital Management
Ltd all as Category 2, to Mediterranean Bank plc
as Category 4 and to Unipol Financial Ltd as
Category 5.
The licence of GlobalCapital Fund Advisors was
upgraded from Category 1b to Category 2, while
the Category 2 licence of Finacom Investment
House Ltd was extended to cover additional
number of services in relation to a number of
instruments. Figure 8 shows the total number of
authorised Investment Services licence holders
between 2004 and 2006.

Tied Insurance Intermediaries

With the entry into force of Legal Notice 180 the

Insurance sub-agents were reclassified as Tied
Insurance Intermediaries as from October 2006.
The number of Tied Insurance Intermediaries as at
December 2006 was five hundred and sixty-seven
representing an increase of nineteen over 2005.
This represents the highest number of Tied
Insurance Intermediaries registered in the last
Figure 8 - Number of Investment Services Licence
four years. Holders

Figure 9 - Investment Services Licence Holders by Category as at December 2006

32
Four companies, namely Cougar Asset
Management Ltd, BOV Stockbrokers Ltd, NDB
Administration Centre Ltd and Azzopardi
Investment Management Ltd voluntarily
surrendered their licence.

The highest number of licence holders fall within

Category 2. Figure 9 shows the distribution of
investment services licence holders by category as
at the end of 2006.
Figure 10 - Total Number of Collective
Investment Schemes
Fund Administration

In September 2006, the Authority issued Recognised Private Schemes

recognition certificates to TMF Fund Administrators
(Malta) Ltd, TMF Services (Malta) Ltd and Valletta During 2006, the Authority issued a recognised
Fund Services Ltd to act as fund administrators in private scheme to Pulse SICAV Ltd.
terms of Section 9A of the Investment Services Act
(Cap. 370). The Authority also accepted the surrender of three
licences (sub-funds) during the year. Consequently
Collective Investment Schemes (CISs) the total number of CIS licences as at the end of
2006 was two hundred when compared to one
The growth in the PIFs sector registered in 2005 hundred and forty-nine as at the end of 2005
continued during 2006 (Figure 10). The Authority (Figure 10). This translates into an increase of
issued fifty-four CIS Licences (including sub-funds) 34.23%. The full list of licences issued is included
out of which twenty-eight were PIFs. These were as Appendix B while a breakdown of the licences
subdivided into eight Experienced Investor PIFs, is presented in Figure 11.
nineteen Qualifying Investor PIFs and one scheme
for both Qualified and Experienced PIFs. The
Authority also issued licences for twenty-two UCITS
schemes and four retail non-UCITS schemes. These
licences were issued as follows; Celsius Global Funds
(SICAV) plc in respect of twenty-two sub-funds to
carry out activities of locally based UCITS; Vilhena
Funds SICAV plc and La Valette Funds (SICAV) plc
were each licensed in respect of one non-UCITS
sub-fund; and HSBC Malta Funds SICAV plc was
- -
licensed in respect of two sub-funds. Celsius Global
Funds (SICAV) plc thereby became the first platform
to be licensed to carry on the activities of a Maltese Figure 11- Breakdown of CIS Licences as at the
UCITS in April 2006. end of 2006

33
 Trustee Services
The coming into force of the Trusts and Trustees
Act (Cap. 331) in 2005 brought the issuing of new
licences for the provision of nominee services to
an end. Companies and individuals who at the end
of 2004 held a licence to provide licensed nominee
services had until the end of 2006 to apply for a
licence to act as trustees and to provide other
fiduciary services under the new legislation.
During the year under review the MFSA issued
thirteen authorisations to act as trustee or provide
other fiduciary services in terms of the Trusts and
Trustees Act (Cap. 331) bringing the total number
of authorisations to seventy (Figure 12). Out of the
thirteen new authorisations issued, four were
restricted to the provision of fiduciary services only.
* Being phased out under the Trusts and Trustees Act
**Out of seventy authorisations for Trustees ten were restricted to the provision of
fiduciary services which do not include acting as trustee
Figure 12 - Nominees/Corporate Trustees
Listing Authority
The Board of Governors acting as the Listing
Authority is assisted by a Listing Committee which
evaluates applications and Admissibility to Listing
in respect of securities and monitors compliance
with Listing Rules.
During the year under review the Listing
Committee evaluated and recommended two
equity and five fixed income securities for
Admissibility to Listing in addition to the listing of
Malta Government Securities and Secondary
Listings of various foreign funds.
34
THE REGISTRY OF COMPANIES
The total number of new companies registered
during the year amounted to two thousand nine
hundred and seventy-nine (Figure 13). The total
number of companies on the register as at
December 2006 amount to forty thousand five
hundred and sixty-four. The number of companies
involved in mergers during 2006 was forty-two
while two companies divided into other companies.
During the year, seven hundred and sixty-six
companies were placed into liquidation whilst
forty-three companies transferred their domicile
to Malta in terms of the Continuation of Companies
Regulations (Legal Notice 344 of 2002) under the
Companies Act (Cap. 386).
Figure 13 - New Company Registrations
The Registry of Companies extended its opening
hours to the public with effect from May 2006 - a
measure introduced in order to provide the public
with a better service. The Registry of Companies’
electronic database provides easy access to
company data by the public. All registered
documents including annual financial statements
can be accessed online. Additional services
launched during the year included searches for all
registered companies, together with basic details
such as company number, registered address and
status of the company.
A new internet service launched in December 2006
by the Hon. Parliamentary Secretary in the Ministry
of Finance Mr Tonio Fenech provides the public
with a facility which allows new online company
registration and the electronic filing of documents
through the use of a digital signature. The
documents which can be filed electronically are
the Memoranda and Articles of Association, the
Annual Returns (Seventh Schedule), Changes in
Company Officials (Form K) and Share Transfer
Details (Form T). The payment of new company
registration fees and annual return fees can also
be made electronically and a free company name
check is also available.
This new development implements the new
requirements of the First Company Law Directive
68/151/EEC dated 9 March 1968 amended by
Directive 2003/58/EC of the European Parliament
and of the Council of the 15 July 2003 which will
come into force in January 2007. Additional features
to the electronic system are expected to be added
in future.
NOTIFICATIONS FOR CROSS-BORDER SERVICES
The number of notifications for the provision of
cross-border services from other EU/EEA states
continued to increase during 2006 indicating a
vibrant financial services market. The total number
of notifications by companies and individuals as
at the end of 2006 stood at three thousand eight
hundred and eighty-eight and is represented in
Figure 14 for the various financial services sectors.
3000
2500
2000
Figure 14 - Total Number of Notifications received for
Cross Border Activities as at December 2006
Credit Institutions
During the year, twenty-one new credit institutions
through their supervisory authority have notified
the MFSA of their intention to provide cross-border
services in Malta in terms of Article 21 of Directive
2000/12/EC, which was replaced with Article 28 of
Directive 2006/48/EC of the European Parliament
and of the Council of the14 June 2006 relating to
the Taking Up and Pursuit of the Business of Credit
Institutions (Recast). The total number of
notifications received as at the end of 2006 amount
to one hundred and nine.
Insurance Business
The MFSA continued to receive notifications from
other EEA insurance supervisory authorities
concerning insurance undertakings intending to
carry on insurance business in Malta in accordance
with the Third Non-Life Directive 92/49/EEC and
Directive 2002/83/EC of the 5 November 2002
concerning life assurance. As at the end of 2006
the total number of notifications received from
insurance undertakings intending to carry on
insurance business under the Freedom of Services
amounted to two hundred and twenty-six while
the total number of insurance undertakings
carrying on business of insurance in Malta under
the Freedom of Establishment at the end of 2006
amounted to five. The total number of notifications
received up to the end of 2006 was two hundred
and thirty-one.
The MFSA continued to receive further notifications
from European insurance intermediaries intending
to carry on insurance mediation activities in Malta
in accordance with the Insurance Mediation
Directive 2002/92/EC. The amount of notifications
received under the Freedom of Services up to the
end of 2006 totals two thousand seven hundred
and nineteen. One insurance intermediary carries
on insurance mediation activities in Malta under
the Freedom of Establishment bringing the total
number of notifications for insurance mediation
up to two thousand seven hundred and twenty.
Investment Services
The Authority was notified that a total of ninety-
two firms intended to provide investment services
in Malta on a cross-border basis in terms of the
Investment Services Directive 93/22/EEC as
amended by Directive 95/26/EC and 97/9/EC and
35
 2000/64/EC. The total number of investment firms
passporting investment services into Malta as at
the end of 2006 amounted to two hundred and
seventy.
Furthermore during 2006, the MFSA also received
twenty-two notifications from foreign credit
institutions intending to provide banking and
investment services in Malta on a cross-border
basis in terms of the Directive 2006/48/EC and the
Investment Services Directive 93/22/EEC bringing
the total to one hundred and two. This brings the
total number of investment firms and credit
institutions passporting their investment services
to three hundred and seventy-two as at the end
of 2006.
UCITS Schemes
During 2006, one hundred and thirty-seven
notifications were received from various European
UCITS schemes to market their Units in Malta in
terms of the UCITS Directive 85/611/EEC as
subsequently amended by 2001/109/EC. A total of
one hundred and fifteen funds were authorised to
market their units in Malta in terms of the UCITS
Directive. As at December 2006, a total of four
hundred and fifty-six funds have been authorised
to market their units in Malta in terms of the
UCITS directive.
Outward Notifications by Maltese Domiciled Firms
Notifications were submitted to regulators in the
United Kingdom and Spain for two sub-funds of
the Celsius Global Funds SICAV plc to be marketed
in terms of Article 44 of the UCITS Directive
85/611/EC.
Ten insurance companies, namely Orlen Insurance
Ltd, Caversham Insurance (Malta) Ltd, Central Life
Ltd, Practice Plan Insurance Ltd, Propgen Insurance
Ltd, Saint John’s Insurance Ltd, Multi Risk Benefits
Ltd, Middlesea Insurance plc, Nautilus Indemnity
(Europe) Ltd and Central General Ltd were
authorised to passport into other EU/EEA countries
during 2006 in accordance with the Third Non-Life
Directive 92/49/EEC and the Directive 2002/83/EC
36
of the 5 November 2002 concerning Life Assurance.
Two insurance brokers, namely First United
Insurance Brokers Ltd and HSBC International
Financial Advisers (Malta) Ltd have passported into
other EU/EEA countries during 2006.
INFORMATION SERVICES
CEBS Press Officers Meeting at the MFSA
The Information Office continued to strenghten
the lines of communication between the
MFSA, the finance industr y, the press
and the general public. The MFSA website
(www.mfsa.com.mt) is proving to be a very useful
communications tool. It received over one hundred
and forty three thousand hits during the year
bringing the total number of hits since its launch,
in March 2005 to two hundred and forty one
thousand. This represents an increase of 47% in
the number of website hits between 2005
and 2006.
During 2006, the Information Office received three
hundred and fifty-nine enquiries directly through
the website. The majority of these enquiries were
in relation to Registry of Companies or banking
matters. Other local and foreign enquiries are
received by phone or email.
A CEBS press officers’ meeting was held at the MFSA
on the 15 September 2006. The meeting was
attended by delegates from twenty-one EU
Member States who gave an overview of
developments in their respective countries in
connection with CEBS awareness, reporting
requirements, super visor y disclosure,
communication, corporate websites and
media relations.
Consumer Complaints
 CONSUMER COMPLAINTS

The main tasks of the Consumer Complaints Office are to educate consumers on financial services issues,
to receive complaints against financial services licence holders and to assist the complainant and the
intermediary to arrive at a voluntary and fair solution. Table 8 indicates the total number of complaints
received during 2006. The MFSA has from this year decided to issue a separate Annual Report on Consumer
Complaints.

Table 8
Number of Consumer Complaints in 2006

FORMAL COMPLAINTS VERBAL COMPLAINTS QUERIES*

New Cases Cases Unresolved

received closed Cases

Banking-related 34 32 5 7 24

Insurance-related 121 117 13 62 116

Investment Services-related 30 39 8 10 34

Others 5 5 2 6 37

Total Complaints 190 193 28 85 211

Except where otherwise stated, data is from 1 January to 31 December 2006.

Closed cases in 2006 include also cases received in 2005.
* Data for queries started being collected as of 1 April 2006 and does not include requests for publications (educational guides and comparative tables) which account for
a further two hundred and fifty (approx).

38
Appendix A
APPENDIX A

Bilateral MOUs with Foreign Regulators

Country Institution Responsibilities Date Scope

Belgium Banking, Finance and Banking, Securities 23/10/2006 Banking

Insurance Commission and Insurance

Germany Bundesanstalt für Banking, Securities 12/09/2004 Banking, Securities and

Finanzdienstleistungsaufsicht (BaFin) and Insurance Insurance (Primarily Banking)

Gibraltar Financial Services Commission Banking, Securities 30/06/2004 Banking, Securities

and Insurance and Insurance

Guernsey Guernsey Financial Services Banking, Investment 17/01/2004 Banking, Investment

Commission Services, Insurance and Services, Insurance and
Fiduciary Services Fiduciary Services

Isle of Man Financial Services Commission Banking, Investment 16/11/2004 Securities and Banking
Services and Corporate
Services Providers

Isle of Man Insurance and Pensions Authority Insurance and Pensions 27/06/2005 Mutual assistance and
exchange of information

Jersey Jersey Financial Services Commission Banking, Securities 21/11/2005 Mutual assistance and
and Insurance exchange of information

Mauritius Financial Services Commission Securities, Insurance 21/01/2004 Securities, Insurance

and Pensions and Pensions

Netherlands De Nederlandsche Bank N.V. (DNB) Banking, Insurance, 23/10/2006 Banking

Pension Funds and
Securities

Portugal Commissão de Mercado de Securities 23/03/2004 Securities

Valores Mobiliários

Slovakia National Bank of Slovakia Banking 12/02/2004 Banking

Turkey Capital Markets Board of Turkey Securities 04/04/2002 Securities

(Semaye Piyasasi Kurulu)

Turkey Banking Regulation Banking 10/12/2004 Banking

and Supervision Agency

United Kingdom Financial Services Authority Banking, Insurance, 23/04/2004 Banking, Insurance,
Investment Services Investment Services

40
 Multilateral MOUs

Organisation Date Scope

IOSCO 28/02/2006 Securities

CESR 01/05/2004 Securities

Bilateral MoUs with the Central Bank of Malta

Institution Date Scope

Central Bank of Malta 16/05/2003 Payment and Securities

settlements systems

Central Bank of Malta 04/02/2003 Exchange of Information in the

fields of financial services

41
Appendix B
APPENDIX B
NEW LICENCES ISSUED DURING 2006
INSURANCE BUSINESS LICENCES
Insurance Companies
• Atlas Insurance PCC Ltd - granted authorisation
to convert into a Protected Cell Company
• Caversham Insurance (Malta) Ltd - to carry on
business of insurance restricted to risks situated
outside Malta in Class 16 (Miscellaneous
Financial Loss)
• Central Life Ltd – to carry on business of
insurance restricted to commitments outside
Malta in Class 1 (Life and Annuity)
• Multi Risks Benefits Ltd - to carry on business of
insurance in various classes of insurance
• Practice Plan Insurance Ltd - to carry on business
of insurance in various classes of insurance
• Propgen Insurance Ltd - to carry on business of
insurance restricted to risks outside Malta in
various classes of insurance
• Saint John’s Insurance Ltd - to carry on business
of insurance in various classes of insurance
Affiliated Insurance Companies
• Orlen Insurance Ltd
Insurance Managers
• Alternative Risk Management (Malta) Ltd
• Heritage Insurance Management (Malta) Ltd
• HSBC Insurance Management (Malta) Ltd
Insurance Agents
• Fogg Insurance Agencies Ltd was authorised to
act as insurance agent of Norwich Union
International Insurance Ltd in various classes
• SMS Insurance Agency Ltd was authorised to
act as insurance agent of Vericherung
Aktiengesellschaft, Faraday Reinsurance Co Ltd,
Catlin Insurance Company (UK), Gerling at
Lloyd’s Syndicate and Lloyd’s Syndicate in
various classes
Insurance Brokers List
2 institutions were enrolled in the Brokers List
during 2006
Insurance Brokers Register
18 individuals were registered in the Brokers
Register during 2006
Tied Insurance Intermediaries
74 new intermediaries were registered during 2006
INVESTMENTS SERVICES LICENCES
Collective Investment Schemes
Retail Schemes - Local
• Celsius Global Funds (SICAV) plc in respect of 1
scheme and 22 sub-funds to carry out the
activities of locally based UCITS
• HSBC Malta Funds SICAV plc in respect of 2
sub-funds (non-UCITS)
• La Valette Funds (SICAV) plc in respect of 1
sub-fund (non-UCITS)
• Vilhena Funds SICAV plc in respect of 1 sub-fund
(non-UCITS)
Professional Investor Funds
• Altma Funds SICAV in respect of 5 sub-funds
(qualifying)
• Amstel Global Umbrella Fund SICAV plc in
respect of 1 scheme and 1 sub-fund
(experienced)
• Broadgate Capital Fund SICAV plc in respect
of 1 scheme and 1 sub-fund (qualifying)
• Century Leader SICAV plc in respect of 1 scheme
(qualifying)
• Ciel European (SICAV) in respect of 1 scheme
(qualifying/experienced)
• Citation Multi Strategy Russia & CIS Hedge Fund
(SICAV) plc in respect of 1 scheme and 1 sub-
fund (qualifying)
43
 • GlobalCapital Funds SICAV in respect of 1 Category 5
scheme and 1 sub-fund (experienced)
• HSBC Malta Funds SICAV plc in respect of •  Unipol Financial Ltd
1 sub-fund (experienced)
• Moment Invest Fund SICAV plc in respect of Recognition as Fund Administrators
1 scheme (experienced)
• Millennium Wave Fund (SICAV) plc in respect of • TMF Fund Administrators (Malta) Ltd
1 scheme (qualifying) •  TMF Services (Malta) Ltd
• NBCG Funds SICAV in respect of 5 sub-funds • Valletta Fund Services Ltd
(qualifying)
• NEF Energy Diversified (SICAV) plc in respect
of 1 scheme and 1 sub-fund (qualifying) TRUSTEE LICENCES
• NEF Nordic Power (SICAV) plc in respect of
1 scheme and 1 sub-fund (qualifying) Authorisation to act as Trustee
• Orange Capital Fund SICAV plc in respect of 4
sub-funds (1 qualifying / 3 experienced) •  BCGL Services Ltd
• Renaissance Institutional Equities Fund SICAV • Chartered Trust Ltd
plc in respect of 1 scheme (qualifying) • CSB Trustees & Fiduciaries Ltd
• Sierra Madre Gold and Silver Venture Capital • Equinox International Ltd
Fund SICAV plc in respect of 1 scheme •  L&TD Fiduciaries Ltd
(experienced) •  La Vallette Fiduciaire Ltd
• Wood & Company Fund SICAV plc in respect of •  Mercury Management Ltd
1 scheme and 1 sub-fund (qualifying) •  Unifin Services Ltd
•  Venture Services Ltd
Recognised Private Schemes
Authorisation to provide fiduciary services only
• Pulse SICAV Ltd
•  FACT Services Ltd
Investment Services Licences • FFC Trust Services Ltd
• MGI Fiduciary Services Ltd
Category 1a •  R. V. Services Ltd

• Swiss Administration Centre Ltd

• Universal Financial Services Ltd

Category 2

• Altegde Capital Management Ltd

• Amstel Capital (Malta) Ltd
• GlobalCapital Fund Advisors (upgraded from
Category 1b)
•  Tell Investment CP
•  Tell Capital Ltd

Category 4

•  Mediterranean Bank plc

44
ABBREVIATIONS

ALFI Association of the Luxemburg Fund Industry

ANDAF Associazione Nazionale Direttori Amministrattivi e Finanziari
BD Banking Directive
BR Banking Rule
CBFA Banking, Finance and Insurance Commission (Belgium)
CEBS Committee of European Banking Supervisors
CEIOPS Committee of European Insurance and Occupational Pensions Supervisors
CESR Committee of European Securities Regulators
CESR-Pol Permanent operational group within CESR responsible for the surveillance
and exchange of information
CESR-Tech Working group within CESR looking at IT related issues
CIS Collective Investment Scheme
CLEG Company Law Expert Group
Co Company
CRD Capital Requirements Directive
DNB De Nederlandsche Bank N.V.
EC European Community
EEA European Economic Area
EFAMA European Fund and Asset Management Association
EU European Union
FIAU Financial Intelligence and Analysis Unit
FSCC Financial Services Consultation Council
FT Financial Times
GAIM Global Alternative Investment Management
GRECO Group of States against Corruption
IAIS International Association of Insurance Supervisors
IOSCO International Organisation of Securities Commission
IT Information Technology
LLTCI Linked Long Term Contracts of Insurance
Ltd Limited
MFSA Malta Financial Services Authority
MiFID Markets in Financial Instruments Directive
MONEYVAL Select Committee of Experts on the Evaluation of Anti-Money Laundering Measures
MMoU Multilateral Memorandum of Understanding
MoU Memorandum of Understanding
NASD National Association of Securities Dealers
NECC National Euro Changeover Committee
PFMA Prevention of Financial Markets Abuse
PIF Professional Investor Fund
PLC Public Liability Company
SFA Special Funds Act
SICAV Investment Company with Variable Share Capital
STEP Society for Trust and Estate Practitioners
UCITS Units for Collective Investments in Transferable Securities
UN United Nations
UK United Kingdom

45
The Armoury at the Presidential Palace in
Valletta is one of the world's greatest arms
collections housed in their original buildings.
It ranks among the most valuable historic
monuments of European culture, containing
abundant material of Italian, German, French
and Spanish origin from principal arms
production centres.
 Attard - Malta
Tel: 00356 2144 1155 Fax: 00356 2144 1189
communications@mfsa.com.mt
www.mfsa.com.mt