The Malta Financial Services Authority (“MFSA”) has recently revised Financial Institution Rules FIR/01, FIR/02 and FIR/03 (the “Rules”) with the aim to reflect the recent amendments in the Financial Institutions Act, Chapter 376 of the Laws of Malta (the “Act”) and which were effected in order to transpose Directive (EU) 2015/2366 of the European Parliament and the Council of 25 November 2015 on payment services in the internal market (“PSDII”). These Rules entered into force with immediate effect.
The main amendments to the Rules are summarised hereunder:
1. FIR/01 on Application Procedures and Requirements for Authorisation under the Act
The new amendments are intended to transpose Article 5 of PSDII and now include reference to Payment Initiation Services ("PIS") and Account Information Services ("AIS"). Moreover, the new procedure for the processing of applications of AIS does not include a minimum capital requirement, however to provide an AIS or PIS, a professional indemnity insurance covering the territories in which the services are being offered or some other comparable guarantee against liability must be provided.
More notably, the revised version includes the European Banking Authority's Guidelines on the information to be provided by prospective payment and electronic money institutions as well as providers of AIS and which is further supplemented through Annexes I to IV.
2. FIR/02 on the Supervisory and Regulatory Requirements of Institutions authorised under the Act
The revised FIR/02 transposes in particular, Article 9 of PSDII. Indeed it lays down the methods payment institutions shall use to calculate the amount of own funds and which they must hold at all times. Furthermore, in view that it is no longer required to seek the MFSA's recognition in the case of an outsourcing service provider in terms of Article 8B of the Act, the "Outsourcing" section of FIR/02 has been amended.
3. FIR/03 on the Taking up, Pursuit and Prudential Supervision of the Business of Financial Institutions Authorised to Issue Electronic Money under the Act
FIR/03 has been amended in view that the waiver of the application of certain provisions, which were previously referred to as Small electronic money issuers have been omitted from the Act. Furthermore, the section on "Safeguarding Requirements" has been amended and now reference to Article 366 of Regulation (EU) No 575/2013 of the European Parliament and of the Council of 26 June 2013 on prudential requirements for credit institutions and investment firms, must be made in order to determine whether assets are secure and low risk.
Feel free to contact us if you require further information on the revised Financial Institutions Rules.