The Legal 500

With the transposition of the Alternative Investment Fund Managers Directive ("AIFMD") in the offing, analysis on the transformation and legal implications of such on the role of the Depositary as a key and core service provider to Alternative Investment Funds ("AIFs") is significant, given the central function and responsibility this position was conferred within this industry. 

Investment Advice: The Maltese Perspective

Investment advice a kind of investment service which may be provided by an investment service provider licensed by the Malta Financial Services Authority (MFSA) under the Investment Services Act (ISA). With the exception of a category 4 licence holder.

Investment Advice is defined in the First Schedule to the Investment Services Act (ISA) in the following manner:

‘Giving, offering or agreeing to give, to persons in their capacity as investors or potential investors or as agent for an investor or potential investor, a personal recommendation in respect of one or more transactions relating to one or more instruments.'

A key element of the definition[2] is a ‘personal recommendation', which is defined as a suggestion which is portrayed as suitable for the person to whom it is addressed, or which is based on a consideration of the circumstances of the recipient. Maltese law also provides for an exception to the effect that a recommendation issued exclusively through distribution channels or to the public does not constitute a personal recommendation.

Introduction

The Alternative Investment Fund Managers Directive ("AIFMD" or "the Directive") has been in discussion since its announcement in April of 2009, but the detail of its implementation has, until fairly recently, been somewhat unclear. However, following the issuing of a number of consultation documents and other instruments there is now far more clarity on the subject. This article will seek to provide an overview of the various instruments by means of which the Directive is to be introduced into Maltese law and will also briefly touch upon the effect that these changes will have on the structure of Maltese funds legislation.  

Introduction: the Maltese Funds Industry

Malta has experienced consistent growth in the funds sector since the jurisdiction's accession to the EU in 2004, such that today it is legitimate to consider the country as a mature, well-established domicile rather than an emerging one. In fact the jurisdiction now hosts around 500 funds pursuing a variety of strategies, as well as a complete ecosystem of support services providers such as fund administrators, law firms and audit firms. The sector has now evolved to the point where managers are not just using the country as a domicile for funds, but are also increasingly looking at the jurisdiction as a domicile for their fund management operations.

Starting circa the beginning of 2010, Malta has seen increasing interest in the Forex sector, an industry which only a handful of years ago was practically non-existent. Different kinds of forex operators, ranging from introducing brokers all the way through to fund managers focusing on forex as an asset class and fully fledged market makers have chosen Malta as their European base of operations. Various authorisations have already been issued by the Malta Financial Services Authority (The MFSA) to such operations, and with many other applications pending before the regulator, additional growth appears to be a certainty in the forthcoming months. In fact, there are already clear clues that forex is set to become, alongside stalwarts such as hedge funds and insurance captives, an important pillar of the Maltese financial services offering.

Recent amendments to the Financial Institutions Act (Chapter 376 of the Laws of Malta) (the “Act”) have effectively brought the regulation of EMIs in Malta.

Introduction – Malta’s Taxable Base Persons ordinarily resident and domiciled in Malta (including companies incorporated in Malta) are chargeable to tax in Malta on a worldwide basis in terms of the Income Tax Act.

Unsurprising tradition

The Enforcement of Malta-registered Mortgages, ‘In Rem’ Actions AgainstVessels Sailing in Maltese Waters, and the Recognition of Foreign-RegisteredMortgages 

A consideration of the salient legal and political developments that have strengthened the foundations of Malta’s remote gaming industry.