B 3065
L.N. 401 of 2017
INVESTMENT SERVICES ACT
(CAP. 370)
BANKING ACT
(CAP. 371)
Investment Services Act and Ba nking Act (MiFID and MiFIR 
Administrative Penalties, Measu res and Investigatory Powers) 
Regulations, 2017
IN EXERCISE of the powers conferred by article 12 of the
Investment Services Act and article 3(1) of the Banking Act, th e
Minister responsible for the regul ation of financial services, acting on
the advice of the Malta Financia l Services Authority, has made the
following regulations:-
Title, scope and 
commencement.1. (1) The title of these regulations is the Investment
Services Act and Banking Act (Mi FID and MiFIR Administrative
Penalties, Measures and Inves tigatory Powers) Regulations, 2017 .
(2) The purpose of these regulations is to transpose and
implement Article 70(1), Article 70(3) to (6) and Article (71)( 1) to (5)
of MiFID, as herein defined and shall be interpreted and applie d
accordingly.
(3) These regulations shall apply to:
(a) Maltese investment firms;
S.L. 370.10(b) European investment firms which have established a
branch in Malta in terms of the European Passport Rights for
Investment Firms Regulations wit h respect to the matters to for
which the competent authority is  responsible in terms of Articl e
35(8) of MIFID;
Cap. 371.(c) Maltese credit institutions licensed under the Banking
Act insofar as these offer structured deposits as defined in
regulation 2(1); and
(d) persons to whom the provisions of MiFIR apply.
(4) These regulations shall come into force on the 3rd January
2018.Suppliment tal-Gazzetta tal-Gvern ta’ Malta Nru. 19,925, 22 ta’ Diċembru, 2017
Taqsima B
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Interpretation.
Cap. 345.2. (1) In these regulations, unless the context otherwise
requires:
"APA" or "approved publication arrangement" means a
person authorised under MiFID to provide the service of
publishing trade reports on behalf  of investment firms pursuant
to Articles 20 and 21 of MiFIR;
"ARM" or "approved repor ting mechanism" means a
person authorised under MiFID to provide the service of
reporting details of transactions  to the competent authority or  to
European regulatory authorities, as the case may be, or to ESMA
on behalf of investment firms;
"competent authority" means the Malta Financial Services
Authority established by the Malta Financial Services Authority
Act;
"CTP" or "consolidated tape provider" means a person
authorised under MiFID to provide  the service of collecting tra de
reports for financial instrumen ts listed in Articles 6, 7, 10, 12, 13,
20 and 21 of MiFIR from regulated markets, MTFs, OTFs and
APAs and consolidating them int o a continuous electronic live
data stream providing price and volume data per financial
instrument;
"deposit" means a credit balance which results from funds
left in an account or from temporary situations deriving fromnormal banking transactions and which a credit institution is
required to repay under the le gal and contractual conditions
applicable, including a fixed-term deposit and a savings deposi t,
but excluding a credit balance where:
(a) its existence can only be proven by a financial
instrument as defined herein unless it is a savings productwhich is evidenced by a certificate of deposit  made out to a
named person and which exists in a Member State on 2 July
2014;
(b) its principal is not repayable at par;
(c) its principal is only repayable at par under a
particular guarantee or agreement provided by the credit
institution or a third party;
"ETF" means an ‘exchange-traded fund’ being a fund of
which at least one unit or sha re class is traded throughout the  day
on at least one trading venue and with at least one market make r
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which takes action to ensure that  the price of its units or sha res on
the trading venue does not vary significantly from its net asse t
value and, where applicable, from its indicative net asset valu e;
"European investment firm" means an investment firm as
defined in Article 4(1) of MiFID authorised by its European
regulatory authority wi thin the meaning of Article 5 of MiFID o r
authorised by a European regulat ory authority in an EEA State";
Cap. 370."financial instrument" means an instrument included in the
Second Schedule to the Investment Services Act;
Cap. 371.
S.L. 371.11."Maltese credit institution" means a credit institution as
defined in point (1) of Articl e 4(1) of Regulation (EU) No 575/
2013 of the European Parliament and of the Council of 26 June
2013 on prudential requirement s for credit institutions and
investment firms and amending Regulation (EU) No 648/2012,
as amended from time which is licensed in terms of the Banking
Act, whose head office is in Malta and who is entitled to carry  on
an activity in a Member State other than Malta in exercise of a
European passport right as defined in the European Passport
Rights for Credit Institutions Regulations;
Cap. 370." M a l t e s e  i n v e s t m e n t  f i r m "  m eans a person licensed in
terms of the Investment Service s Act, whose head office is in
Malta and who is entitled to ca rry on an activity in a Member
S tate or EEA S tate other than Malta in exercise of a EuropeanRight;
"European Right" means the entitlement of a person to
establish a branch, or provide  services, in a Member State or
EEA State other than that in which it has its head office:
(a) in accordance with the Treaty as applied in the
Member State or EEA State; and
(b) subject to the requirements of MIFID and
subject to any regulations  made under the Act; and, or
Investment Services Rules and, or Conduct of Business
Rules issued by the competent authority in terms of article
6 of the Act; implementing su ch requirements as may be
applicable;
"MiFID" means Directive 2014/65/EU of the European
Parliament and of the Council of 15 May 2014 on markets infinancial instruments, as amended from time to time, and
includes any implementing measures that have been or may be
issued thereunder;
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"MiFIR" means Regulati on (EU) No 600/2014 of the
European Parliament and of the Council of 15 May, 2014 on
markets in financial instrumen ts and amending Regulation (EU)
No 648/2012, as may be amended from time to time, and
includes any implementing measures, implementing technical
standards, regulatory technical standards, guidelines and similar
measures that have been or may be issued thereunder;
"structured deposit" means  a deposit as defined in
paragraph (c) of the definiti on "deposit", and which is fully
repayable at maturity on term s under which interest or a
premium will be paid or is at risk, according to a formulainvolving factors such as: 
(a) an index or combination of indices, excluding
variable rate deposits whose re turn is directly linked to an
interest rate index such as Euribor or Libor; 
(b) a financial instrument or combination of
financial instruments; 
(c) a commodity or combination of commodities or
other physical or non-physical non-fungible assets; or 
(d) a foreign exchange rate or combination of
foreign exchange rates;
Cap. 370.
Cap. 371.(2) Words and expressions which are also used in the
Investment Services Act or in the Banking Act shall have the sa me
meaning as in the respective Acts.
Supervisory powers and 
powers to 
impose penalties.
Cap. 370.
Cap. 371.3. The competent authority shall exercise its supervisory
powers and its powers to impose penalties, in such a way as to ensure
full and complete adherence to the requirements and obligations
arising out of the Investment S ervices Act or the Banking Act and any
regulations, Investment Service s Rules and Conduct of Business Rules
issued by the competent authority and MiFIR, either directly or  i n
collaboration with European regul atory authorities and with ove rseas
regulatory authorities, in terms of law as warranted by the rel evant
circumstances and shall take all  measures necessary to ensure t hat such
administrative penalties are implemented. 
Administrative 
penalties and other 
administrative 
measures.Cap. 370.
Cap. 371.4. (1) Without prejudice to article 16A of the Investment
Services Act, to any regulations made under article 6(2) of the
Investment Services Act and to article 35A of the Banking Act a nd to
the supervisory powers of the c ompetent authority referred in
regulation 3, the competent aut hority shall impose administrati ve
penalties and other administrative measures in respect of breac hes of: 
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Cap. 370. (a) the provisions of the Investment Services Act and, or
of regulations and, or Investment Services Rules and Conduct of
Business Rules issued by the co mpetent authority transposing
the provisions of MiFID;
(b) the provisions of MiFIR.
(2) The administrative penalties and other measures taken
pursuant to sub-regulation (1) shall be effective, proportionat e and
dissuasive. 
Administrative 
penalties and other 
administrative 
measures for breaches of 
MiFID and 
MiFIR.5. (1) The competent authority sh all exercise its supervisory
powers and its powers to take and impose at least the following
administrative penalties and measures:
(a) a public statement which indicates the natural or legal
person and the nature of the infringement;
(b) an order requiring the natural or legal person to cease
the conduct and to desist from a repetition of that conduct;
(c) in the case of a Maltese investment firm, and in the
case of the following persons authorized in Malta:
(i) market makers authorized to operate an MTF or
OTF;
(ii) an APA;
(iii) a CTP; and, or
(iv) an ARM;
Cap. 370.withdrawal or suspension of the r elative licence or authorisati on in
accordance with the provisions of the Investment Services Act a nd
the regulations issued thereunder;
(d) a temporary ban on any Maltese investment firm
being a member of or participa nt in regulated markets or MTFs
or any client of OTFs;
(e) in the case of a legal person, maximum administrative
fines of up to five million euro (€5,000,000), or 10% of the to tal
annual turnover of the legal person according to the last avail able
accounts approved by the management body:
Provided that where the legal person is a parent
undertaking or a subsidiary of t he parent undertaking which has
to prepare consolidated financial accounts in accordance with
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Directive 2013/34/EU of the Eu ropean Parliament and of the
Council, the relevant total an nual turnover shall be the total
annual turnover or the corresponding type of income in
accordance with the relevant Union law in the area of
accounting, according to the last available consolidated accoun ts
approved by the management body of the ultimate parent
undertaking;
(f) in the case of a natural person, maximum
administrative fines of up to five million euro (€5,000,000);
(g) maximum administrative fines of up to twice the
amount of the benefit derived fro m the infringement where that
benefit can be determined, even if that exceeds the maximum
amounts specified in paragraphs (e) and (f) above.
Publication of 
decisions. 6. (1) The competent authority shall publish any decision
imposing an administrative penalt y or measure which it shall take
under these regulations on its of ficial website, without undue delay
after the person on whom the pen alty or measure was imposed has
been informed of that decision. The publication shall include a t least
information on the type and nature of the infringement and the identity
of the persons responsible:
Provided that this obligati on shall not apply to decisions
imposing measures that are of an investigatory nature.
(2) Notwithstanding sub-regulation (1), where the publication
of the identity of the legal per sons or of the personal data of  the natural
persons is considered by the competent authority to be
disproportionate following a case-by-case assessment conducted on
the proportionality o f the publication of s uch data, or where
publication jeopardises the stabi lity of financial markets or a n on-
going investigation, the compete nt authority shall either:
(a) defer the publication of t he decision to impose the
administrative penalty or meas ure until the moment where the
reasons for non- publication cease to exist; 
(b) publish the decision to impose the administrative
penalty or measure on an ano nymous basis in a manner which
complies with Maltese law, if such anonymous publication
ensures an effective protection of the personal data concerned;  or
         (c)not publish the decision to impose an
administrative penalty or measure at all in the event that the
options set out in points (a) and (b) are considered to be
insufficient to ensure:
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(i) that the stability of financial markets would not
be put in jeopardy; 
(ii) the proportionality o f the publication of such
decisions with regard to administrative penalties or
measures which are deemed to be of a minor nature.
(3) In the case of a decision to publish an administrative
penalty or measure on an anonymous basis in accordance with sub -
regulation (2), the publication of the relevant data may be pos tponed
for a reasonable period of time if it is envisaged that within that period
the reasons for anonymous publication shall cease to exist.
(4) Where the decision to impos e an administrative penalty or
measure is subject to appeal in terms of regulation 8, the competent
authority shall also publish, immediately, on its official webs ite such
information and any subsequent  information on the outcome of su ch
appeal. Moreover, any decision annulling a previous decision toimpose an administrative penalt y or a measure shall also be pub lished.
(5) The competent authority sh all ensure that any publication
in accordance with this regulation shall remain on its official  website
for a period of at least five years after its publication: 
Provided that personal data c ontained in the publication
shall only be kept on the official website of the competent aut hority for
the period which is necessary in accordance with the applicable  data
protection laws.
(6) This regulation shall be w ithout prejudice to article 16(8)  of
the Malta Financial Services Authority Act. 
(7) The competent authority shall inform ESMA of all
administrative penalties imposed but not published in accordance withpoint (c) of sub-regulation (2) including any appeal in relation thereto
and the outcome thereof.
(8) The competent authority shall provide ESMA annually
with aggregated information regarding all sanctions and measure s
imposed in accordance with sub-regulations (1) to (4):
Provided that this obligation does not apply to measures of
an investigatory nature.
(9) Where the competent authority has disclosed an
administrative measure, penalty or criminal sanction to the pub lic, it
shall, at the same time , report that fact to ESMA.
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Applicability of 
these 
regulations. 
S.L. 370.10.7. (1) These regulations shall apply at least in the case of
breach of one or more of any of the following by a Maltese inve stment
firm or a European investment fir m which has established a bran ch in
Malta in terms of the European Passport Rights for Investment F irms
Regulations insofar as the enfo rcement of the provisions indica ted
hereunder fall within the responsibility of the competent autho rity in
terms of Article 35(8) of MIFID, or by a Maltese credit institu tion
offering structured deposits, i nsofar as the provisions indicat ed
hereunder apply to the latter in terms of Article 1(4) of MIFID : 
Cap. 370.(a) the provisions of article 6(1)(a),(d) and (e) 7(2)(b)
and (c), 10(1), (2) and (4) of the Investment Services Act;
(b) the provisions of the Investment Services Rules
transposing the provisions of Article 9 (1),(2), the second sub -
paragraph of sub article (3), ( 5) and (6) 11(1) and (3) and 16 (2),
(4), (5), (6), (7) and (10) of MiFID;
(c) the Conduct of Business Rules transposing the
provisions of the first and second sub-paragraphs of 9(3), 16(3 ),
23(1), (2) and (3), 24(1) to (5) and (7) to (10) and the first and
second sub-paragraphs of Articl e 24(11), Articles 25(1) to (6),
the second sentence of Article 26 (1), Articles 26 (2) and (3), 27
(1) to (8), 28(1) and (2), the second sub-paragraph of Article
30(1), the first sentence of the second sub-paragraph of Articl e
30(3) of MiFID;
S.L. 370.05.(d) the provisions of the Investment Services Act
(Control of Assets) Regulations transposing Article 16 (8), (9)and second sub-paragrap h of Article 16(11) of  MiFID;
L.N. 395. (e) the provisions of regulations 3 to 8 of the Algorithmic
Trading Regulations, 2017 transposing Article 17 of MiFID; 
L.N. 400.(f) the provisions of regulations 3(1) to (6), 4, 5, 6(1) to
(3) and (5), 7(1),(3) and (4) of  the Multilateral Trading Facil ities
and Organised Trading Facilities Regulations, 2017;
S.L. 370.13.
L.N. 400.(g) the provisions of regulat ions 3(2) and 4(2) of the
European Passport Rights for Persons Operating Multilateral
Trading Facilities Regulations or the Multilateral Trading
Facilities and Organised Trading Facilities Regulations, 2017;
S.L. 370.10.(h) the provisions of regulations  3(2)(a), (4) and (5), 4(2)
and (5), 8(2), (8), (10) and (11), 10(2), (5) to (7) of the Eur opean
Passport Right for Investment Fir ms Regulations as well as thos e
provisions in the latter regulat ions, transposing Article 16(11 ) of
MiFID;
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L.N. 387.(i) the provisions of regulation 3(1), (2) and (4) of the
Central Counterparties Access Regulations, 2017;
L.N. 389.(j) the provisions of regulations 3(1) to (3), (5), (15) and
(17) and regulation 4(1) to (7) of the Position Limits and Position
Management Controls in Commodi ty Derivatives and Reporting
Regulations, 2017;
L.N. 391.(k) the provisions of regulations 7(1) to (5), 8, 9, and 10
of the Data Reporting Servi ces Regulations, 2017; and
L.N. 403. (l) the provisions of the Inve stment Services Act (Tied
Agents) Regulations, 2017 transposing the first sub-paragraph o f
Article 29(2), the third sub-paragraph of Article 29(2), the fi rst
sentence of Article 29(3), the fi rst sub-paragraph of Article 2 9(4)
and Article 29(5) of MiFID.
(2) Without prejudice to sub-regu lation (1), these regulations
shall also apply at least in the case of breach of one or more of the
following provisions of MiFIR by persons to whom the provisions  of
MiFIR apply: 
(a) the provisions of Article  3(1) and (3) on pre-trade
transparency requirements for trading venues in respect ofshares, depositary receipts, ETF s, certificates and other finan cial
instruments;
(b) the provisions of the first paragraph of Article 4(3) on
waivers for equity instruments;
(c) the provisions of Article 6 on post-trade transparency
requirements for trading venues in respect of shares, depositar y
receipts, ETFs, certificates  and other similar financial
instruments;
(d) the provisions of the third paragraph of Article 7(1)
on the requirement to obtain th e competent authority’s prior
approval of proposed arrange ments for deferred trade
publication;
(e) the provisions of Article 8( 1), (3) and (4) on pre-trade
transparency requirements for trading venues in respect ofbonds, structured finance products, emission allowances and
derivatives;
(f) the provisions of Article 10 on post-trade
transparency requirements for trading venues in respect ofbonds, structured finance products, emission allowances and
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derivatives;
(g) the provisions of the third paragraph of Article 11(1)
and the third paragraph of Art icle 11(3) on authorisation of
deferred publication; 
(h) the provisions of Articl e 12(1) on the obligation to
make pre-trade and post-trade data available separately;
(i) the provisions of Articl e 13(1) on the obligation to
make pre-trade and post-trade da ta available on a reasonable
commercial basis; 
(j) the provisions of Article 14(1), the first sentence of
sub-article (2), the second to the fourth sentence of sub-artic le
(3) on the obligation for system atic internalisers to make publ ic
firm quotes in respect of share s, depositary receipts, ETFs,
certificates and other financial instruments and on the
requirement applicable to systematic internaliser on the size and
sizes at which they quote;
(k) the provisions of the first paragraph of Article 15(1),
the first and third sentence of the second paragraph of sub-art icle
(2) and the second sentence of sub-article (4) on execution of
client orders;
(l) the provisions of the second sentence of Article 17(1)
on the requirement of clear standards governing access to quote s
of systematic internalisers;
(m) the provisions of Article 18(1), (2), (4) [first
sentence], (5) [first sentence], the first paragraph of sub-art icle
(6) and sub-articles (8) and (9 ) on the obligation for systemat ic
internalisers to make public f irm quotes in respect of bonds,
structured finance products, emission allowances andderivatives; 
(n) the provisions of Article 20(1) and (2) (first sentence)
on the post-trade disclosure by investment firms, including
systematic internalisers, in res pect of shares, depositary rece ipts,
ETFs, certificates and other similar financial instruments and the
requirement for the informati on which is made public and the
time limits within which it is published to comply with therequirement adopted pursuant to  Article 6 and the regulatory
technical standards adopted in accordance with A rticle 7(2)(a);
(o) the provisions of Article 21(1) to (3) on post-trade
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disclosure by investment firms including systematic
internalisers, in respect of bonds, structured finance products ,
emission allowan ces and derivatives;
(p) the provisions of Article 22(2) on the provision of
information for the purposes of transparency and other
calculations and the requirement  of trading venues, APAs and
CTPs to store the necessary data  for a sufficient period of tim e; 
(q) the provisions of Article 23(1) and (2) on the trading
obligation of investment firms; 
(r) the provisions of Artic le 25(1) and (20) on the
obligation to maintain records; 
(s) the provisions of the first paragraph of Article 26(1),
(2) to (5), the first paragraph to sub-article (6) and the firs t, fifth
and eighth paragraphs to sub-ar ticle (7) on the obligation to
report transactions; 
(t) the provisions of Article 27(1) on the obligation of
trading venues and systematic internalisers to provide thecompetent authority with identifying reference data for the
purpose of reporting under Article 26;
(u) the provisions of Article 28( 1) and the first paragraph
of sub-article (2) on the obliga tion to trade on regulated mark ets,
MTFs or OTFs;
(v) the provisions of Article 29(1) and (2) on the clearing
obligation for derivatives traded on regulated markets and timingof acceptance for clearing; 
(w) the provisions of Article 30(1) on indirect clearing
arrangements;
(x) the provisions of Article 31(2) and (3) on the
requirement of investment firms  and market operators providing
portfolio compression to make public through an APA, thevolumes of transactions and the time they were concluded in
terms of Article 10 and the requirement to keep complete andaccurate records;
(y) the provisions of Article 35(1) to (3) on non-
discriminatory access t o a central counterparty;
(z) the provision of Article 36(1) to (3) on non-
discriminatory access to a trading venue; and 
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(aa) the provisions of Article 37(1) and (3) on non-
discriminatory access to and oblig ation to licence benchmarks.
(3) These regulations shall  also apply in cases where:
(a) a Maltese investment firm does not abide by any
order exercised by ESMA by virtue of its temporary intervention
powers in terms of Article 40 of MiFIR;
(b) a Maltese credit institution offering structured
deposits does not abide by any order exercised by the EBA byvirtue of its temporary interven tion powers in terms of Article  41
of MiFIR; and
( c ) a  M a l t e s e  i n v e s t m e n t  f i r m  o r  a  M a l t e s e  c r e d i t
institution offering structured  deposits does not abide by any
order exercised by the competent authority by virtue of theproduct intervention powers in terms of Article 42 of MiFIR. 
(4) The provision of investment  services, in or from Malta,
without the required authorisation or approval in accordance wi th:
Cap. 370. (a) the provisions of the Investment Services Act
transposing Article 5 of MiFID;
(b) the provisions of the Investment Services Rules
transposing Article 6(2) of MiFID; 
S.L. 370.10. (c) the provisions of the European Passport Right for
Investment Firms Regulations t ransposing Articles 34 and 35 of
MiFID;
S.L. 370.13.
L.N. 400.(d) the provisions of the European Passport Rights for
Persons Operating Multilateral  Trading Facilities Regulations o r
the Multilateral Trading Faci lities and Organised Trading
Facilities Regulations, 2017 tra nsposing Article 34 of MiFID; 
L.N. 405. (e) the provisions of the Investment Services Act
(Provision of Investment Servi ces and Activities by Third
Country Firms) Regulations, 2017 transposing Article 39 of
MiFID;
L.N. 391. (f) the provisions of the Data Reporting Services
Regulations, 2017 transposing Article 59 of MiFID:
shall also be considered as an infringement of the MiFID and
therefore subject to the applicability of these regulations.
(5) The provision of investment  services, in or from Malta,
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without the required authorisation or approval contrary to the
requirements prescribed in:
(a) the provisions of Arti cle 7(1) of MiFIR on the
requirement of market operators  and investment firms operating
a trading venue to obtain the competent authority’s prior
approval of the proposed arran gement for deferred trade
publication and to d isclose these arrangements to the market
participants and t o the public; and
(b) the provisions of Article 11(1) of MiFIR on the
requirement applicable to market  operators and investment firms
operating a trading venue to obtain authorisation from the
competent authority for deferred publication of the details of
transactions based on the size and type of the transaction:
shall also be considered as an  infringement of the MiFIR and
thereafter subject to the applic ability of these regulations.
(6) Failure to cooperate or compl y in an investigation or with
an inspection or request covered by Article 69 of MiFID shall a lso be
considered an infringement and subject to the applicability of these
regulations. 
Right of Appeal.
Cap. 330.8. A right of appeal to the Financial Services Tribunal shall lie
from the decisions which the com petent authority shall take und er
these regulations and the provisi ons of article 21 of the Malta
Financial Services Authority Act shall apply mutatis mutandis .
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