Updated Rulebook for Maltese Investment Firms

On the 5th August 2021, the Malta Financial Services Authority (“MFSA“) issued a Circular reminding relevant entities that the Investment Firms Regulation and Directive (the “IFRD Package“) came into force on the 26th June 2021.

The MFSA has noted that that the bill amending the Investment Services Act (“ISA“) has been submitted to the Maltese parliament for approval, while the legal notices which will serve to introduce the new subsidiary legislations are currently in the drafting process. Once they are published in the Government Gazette, they will officially become applicable and the IFRD Package would be transposed. Furthermore, the MFSA has also issued the revised Part BI: Rules applicable to Investment Services Licence Holders which qualify as MiFID firms (the “Rulebook“).

The MFSA remarked that the changes conducted to the Rulebook were significant due to the implementation of the IFRD package, along with various other regulations and directives such as the Taxonomy Regulation, the Sustainable Finance Disclosure Regulation, the Capital Requirements Directive and Regulation, the MiFIR, and MiFID II.

As provided by the MFSA in its circular, the changes are as follows:


The IFRD package replaces the current categories and introduces new classes of investment firms. The new Rulebook reflects three new classes and is split in three parts:

Part 1 General: All Classes

This part applies to all classes of Investment Firms and contains provisions deemed necessary by the MFSA to transpose the MiFID II and the IFD.

Part 2: Class 1s and Class 1 Minus

This part automatically applies to the largest investment firms, Class 1s, which are subject to the CRR and
the CRD. Class 1 Minus firms may also be subjected to this area of the Rulebook, when they satisfy certain
criteria of the IFRD package and the MFSA deems it necessary. This part implements the CRR and partially
transposes the CRD.

Part 3: Class 1 Minus, Class 2 and Class 3

This Part implements the IFR and partially transposes the IFD, which governs and regulates Class 2 and
3 firms. This Part applies to all Class 1 Minus firms on a case-by-case basis as the MFSA deems fit in view
that the EU framework allows the MFSA to determine under which framework Class 1 minus firms should

Implementation of Regulations

As explained above, the MFSA has updated the Rulebook to include all the relevant regulations applicable to Investment Firms. In this regard, the MFSA opted for a comprehensive and streamlined approach by creating titles with the names of chapters of the relevant regulations and inserted the respective rules therein.

Removal of the concept of Introducers

As the concept of ‘Introducers’ was a Maltese concept introduced by the MFSA which was not reflected in the IFRD Package, the MFSA opted to remove this concept from the new Rulebook in order to promote cohesiveness.

Feel free to contact us should you wish to receive further information on the new Rulebook and classes mentioned above.