under article 31C and the imposition of any limitation on the use of an internal model for the calculation of the Solvency Capital Requirement as determined in Insurance Rules made for the purposes of Title I,
\n
Chapter VI, Section 4, Subsection 3 of the Solvency II
\n
Directive.
\n
(8)For the purposes of paragraph (b) and (c) of sub-article (7) and where the competent authority is not the group supervisor, the group supervisor shall always be consulted.
\n
(9)Where the competent authority is considering a decision based on information received from other authorities responsible for the supervision of an individual insurance or reinsurance undertaking in a group, it shall consult such authorities concerned before taking that decision.
\n
(10)Without prejudice to Article 248 of the Solvency II Directive, the competent authority may decide not to consult other authorities in cases of urgency or where such consultation may jeopardise the effectiveness of its decision. In such a case, the c o m p e t e n t a u t h o r i t y s h a l l w i t h o u t d e l a y, i n f o r m t h e o t h e r authorities responsible for the supervision of an individual insurance or reinsurance undertaking in a group.
\n
(11)Where the competent authority is the group supervisor and requires information from an undertaking for the purposes of Article 254(2) of the Solvency II Directive, which has already been given to another authority responsible for the supervision of an individual insurance or reinsurance undertaking in a group, the competent authority shall, whenever possible, contact that authority to obtain such information.
\n
(12)Where a parent undertaking has its head office in Malta and the competent authority is not the group supervisor pursuant to Article 247 of the Solvency II Directive, the competent authority shall, upon request by the group supervisor, require the parent INSURANCE BUSINESS undertaking to provide any relevant information for the exercise of group supervision as set out in Article 248 of the Solvency II D irect iv e, an d th e c om pet en t aut ho ri ty sh all t ransm it su ch information to the group supervisor.
\n
(13)Where the competent authority is the group supervisor, it may ask the European regulatory authority of a parent undertaking which has its head office in another Member State, to request such undertaking to submit any information which would be relevant for the exercise of its co-ordination rights and duties as set out in Article 248 of the Solvency II Directive, and to transmit it directly to the competent authority.
\n
(14)Information received for the purposes of this article shall be treated as confidential and protected by the duty of professional secrecy.
\n
Verification of information.
\n
Added by:
\n
XXXIII. 2015.33.
\n
Art. 32D
\n
32D. (1) Without prejudice to article 30, the competent authority may carry out in Malta, itself or through a person appointed for that purpose, on-site verification of information as referred to in Article 254 of the Solvency II Directive on the premises of any of the following: (a) an insurance or reinsurance undertaking which is subject to group supervision; (b) related undertakings of the undertaking referred to in paragraph (a); (c) parent undertakings of the undertaking referred to in paragraph (a); (d) related undertakings of a parent undertaking of the undertaking referred to in paragraph (a).
\n
(2)Where the competent authority requires, in specific cases, to verify information concerning an undertaking, whether regulated or not, which forms part of a group and is situated in another Member State, the competent authority shall: (a) request the European regulatory authority to enable the competent authority to carry out the on-site verification itself; or (b) request the European regulatory authority to carry out such verification on its behalf, or to appoint an auditor or an expert to carry out such verification; or (c) in cases where it does not carry out the on-site verification itself, request to participate in the carrying out of such verification.
\n
(3)Where the competent authority receives, in specific cases, a request by a European regulatory authority to verify the information concerning an undertaking situated in Malta, whether regulated or not, which is part of a group, the competent authority shall act upon that request either by carrying out the on-site verification itself, by allowing an auditor or expert to carry it out, or by allowing the European regulatory authority which made the request to carry it out itself, and such authority may, where it does INSURANCE BUSINESS not carry out such verification itself, participate in the on-site verification.
\n
(4)Where the competent authority has received a request pursuant to sub-article (3), it shall inform the group supervisor of the action taken pursuant to sub-article (3).
\n
(5)Where the request to a European regulatory authority to have a verification carried out in accordance with sub-article (2) has not been acted upon within two weeks, the competent authority may refer the matter to EIOPA and may request its assistance in accordance with Article 19 of Regulation (EU) No 1094/2010.
\n
(6)For the purposes of sub-articles (2) and (3), in accordance with Article 21 of Regulation (EU) No 1094/2010, EIOPA shall be entitled to participate in on-site examinations where they are carried out jointly by the competent authority and any one or more European regulatory authorities.
\n
Art. 32E
\n
32E. Deleted by XXVI.2018.73.
\n
Art. 32F
\n
32F. Deleted by XXVI.2018.73.
\n
PART VIII
\n
TRANSFER OF BUSINESS OF INSURANCE
\n
Art. 33
\n
33.(1) Where it is proposed to carry out a scheme under which an authorised insurance undertaking (\"the transferor\"), is to transfer to another undertaking, whether authorised thereunder or not (\"the transferee\") all its rights and obligations under such general business policies, or general business policies of such descriptions, as may be specified in the scheme, and (a) where the transferor is an undertaking whose head office is in Malta, the performance by it of the obligations proposed to be transferred constitutes the carrying on of business of insurance in or from Malta or in or from a country outside Malta; or (b) where the transferor is a third country insurance undertaking, the performance by it of the obligations proposed to be transferred constitutes business of insurance in or from Malta, the transferor shall apply to the competent authority for its approval of the scheme.
\n
(2)The competent authority shall not determine an application made under sub-article (1) unless it is satisfied that (a) a notice approved by it for the purpose has been published (i) in at least two local daily newspapers of which one is published in the Maltese language and the Parent undertakings outside the Union: verification of equivalence.
\n
Added by:
\n
XXXIII. 2015.33.
\n
Parent undertaking as a mixed-activity insurance holding company.
\n
Added by:
\n
XXXIII. 2015.33.
\n
Transfer of general business.
\n
Amended by:
\n
XX. 2007.130;
\n
XXXIII. 2015.34.
\n
INSURANCE BUSINESS other in the English language; and the text of the notice shall be in Maltese in the Maltese daily and in English in the English daily; (ii) where the transferor is an undertaking which carries on business from Malta or in or from a country outside Malta and, as regards any policy included in the proposed transfer which evidences a contract of insurance, the risk is a risk situated outside Malta, in two daily newspapers in the country where the risk is situated; (b) except in so far as the competent authority has otherwise directed, a copy of the notice has been sent by the transferor to every policyholder affected by the scheme and every other person who claims an interest in a policy included in the proposed transfer and has given notice of his claim to the transferor; (c) copies of a statement setting out particulars of the transfer and approved for the purpose by the competent authority have been available for inspection (i) at each of the branches, agencies and offices of the transferor in Malta; (ii) except in so far as the competent authority has otherwise directed, where the transferor is an undertaking which carries on business from Malta or in or from a country outside Malta and, as regards any policy included in the proposed transfer which evidences a contract of insurance, the risk is a risk situated outside Malta, at one or more places in the country where the risk is situated, for a period of not less than thirty days beginning with a date to be determined by the competent authority.
\n
(3)The notice referred to in sub-article (2) shall include a statement that written representations concerning the transfer may be sent to the competent authority within a period to be specified by the competent authority; and the competent authority shall not determine the application until after considering any representations made to it before the specified day.
\n
(4)The competent authority shall not approve a transfer on an application made under sub-article (1) unless it is satisfied that (a) (i) the transferee is, or immediately after the approval will be, authorised under article 7 to carry on general business of the class or classes or part classes to be transferred under the scheme; (ii) the transferee is, or immediately after the approval will be, authorised under Article 14 or Article 162 of the Solvency II Directive to carry INSURANCE BUSINESS (iii) (b) (i) (ii) (iii) (c) (i) (ii) (iii) on general business of the class or classes or part classes to be transferred under the scheme in a Member State or EEA State; or if the transferee does not fall within subparagraphs (i) and (ii) of this paragraph, the transferee has the authorisation required to enable the business, or part which is to be transferred, to be carried on in the place to which it is to be transferred, or will have it before the scheme takes effect; and the transferee referred to in sub-paragraph (i) of paragraph (a) of this sub-article possesses, after taking the proposed transfer into account, the necessary eligible own funds to cover the Solvency Capital Requirement required to be maintained under this Act; the transferee referred to in sub-paragraph (ii) of paragraph (a) of this sub-article possesses, after taking the proposed transfer into account, the necessary eligible own funds to cover the Solvency Capital Requirement provided for in Article 100 of the Solvency II Directive; or if the transferee does not fall within subparagraphs (i) and (ii) of this paragraph, the transferee possesses, or will possess before the scheme takes effect, the solvency requirements required of it by, or under, the law applicable in the place to which the business is being transferred; and if the transferee is an undertaking authorised under this Act, the transferee’s financial resources are, consequential to the transfer, adequate to fulfil the other obligations required of it by, or under, this Act; or if the transferee is a European insurance undertaking, the transferee’s financial resources are consequential to the transfer, adequate to fulfil the other obligations required of it by, or under, the law applicable in the place to which the business is being transferred; or if the transferee is a third country insurance undertaking, the transferee’s financial resources are, consequential to the transfer, adequate to fulfil the other obligations required of it by, or under, the law applicable in the place to which the business is being transferred; and
\n
(d) if the transferor is an undertaking whose head office is in Malta, and the establishment from which the policies are to be transferred is situated in a Member State or EEA State (i) the European regulatory authority in that INSURANCE BUSINESS Member State or EEA State has been consulted about the proposed transfer; and (ii) the European regulatory authority has either responded or the period of three months beginning with the consultation has elapsed; (e) if the transferor is an undertaking which carries on business from Malta or in or from a country outside Malta and, as regards any policy included in the proposed transfer which evidences a contract of insurance, the risk is a risk situated outside Malta (i) the European regulatory authority in the country where the risk is situated has been notified of the proposed transfer; and (ii) the overseas regulatory authority where the risk is situated has been notified of the proposed transfer; and (iii) either the European regulatory authority or the overseas regulatory authority has consented to the transfer or the European regulatory authority or the overseas regulatory authority has not refused its consent to the transfer within the period of three months beginning with the date of the notification.
\n
(5)On determining an application made under sub-article (1), the competent authority shall (a) publish a notice of its decision in such manner as it may think fit; and (b) send a copy of that notice to the transferor, the transferee and every person who made representations in accordance with the notice referred to in sub-article
\n
(2), and if it refuses the application it shall inform the transferor and the transferee in writing of the reasons for its refusal.
\n
Effect of approval under article 33.
\n
Amended by:
\n
XXXIII. 2015.35.
\n
Art. 34
\n
34.(1) Subject to sub-article (2), a scheme giving effect to a transfer approved by the competent authority under article 33 shall be effectual in law (a) to transfer to the transferee all the transferor’s rights and obligations under the policies included in the transfer scheme; and (b) if the scheme so provides, to secure the continuation by or against the transferee of any legal proceedings by or against the transferor which relate to those rights or obligations, notwithstanding the absence of any agreements or consents which would otherwise be necessary for it to be effectual in law for those purposes.
\n
(2)A transfer approved by the competent authority shall automatically be valid against policyholders, the insured persons INSURANCE BUSINESS and any other person having rights or obligations arising out of the contracts transferred.
\n
(3)Except in so far as the competent authority may otherwise direct, a policyholder whose policy is included in such a scheme shall be given written notice of its carrying out by the transferee.
\n
Art. 35
\n
35.(1) Where it is proposed to carry out a scheme under which the whole or part of the long term business carried on by an authorised insurance undertaking under this Act (\"the transferor\"), is to be transferred to another undertaking whether authorised thereunder or not (\"the transferee\"), and (a) where the transferor is an undertaking whose head office is in Malta, the business proposed to be transferred is business carried on in or from Malta or in or from a country outside Malta; (b) where the transferor is a third country insurance undertaking, the business proposed to be transferred is business carried on in or from Malta, the transferor or the transferee shall, by application filed before the Financial Services Tribunal, request approval of the scheme.
\n
Approval by the Tribunal shall be in accordance with the provisions of this article.
\n
(2)The Tribunal shall not determine an application filed before it under sub-article (1) unless (a) the application is accompanied by a report on the terms of the scheme by an independent actuary; and (b) the Tribunal is satisfied that the requirements of subarticle (3) have been complied with.
\n
(3)The requirements referred to in sub-article (2)(b) are (a) a notice stating that the application has been made and giving the addresses of the branches, agencies and offices at which, and the period for which, copies of the documents mentioned in paragraph (d) will be available as required by that paragraph has been published (i) in at least two local daily newspapers of which one is published in the Maltese language and the other in the English language; and the text of the notice shall be in Maltese in the Maltese daily and in English in the English daily; (ii) where the transferor is an undertaking which carries on business from Malta or in or from a country outside Malta and, as regards any policy included in the proposed transfer which evidences a contract of insurance, a country outside Malta is the country of the commitment, in two daily newspapers in that country; (b) except in so far as the Tribunal has otherwise directed, a statement - Transfer of long term business.
\n
Amended by:
\n
XX. 2007.131;
\n
XXXIII. 2015.36.
\n
INSURANCE BUSINESS (i) setting out the terms of the scheme, and (ii) containing a summary of the report mentioned in sub-article (2)(a) sufficient to indicate the opinion of the actuary on the likely effects of the scheme on the long term business policyholders of the undertakings concerned, has been sent to each of those policyholders and every other person who claims an interest in a policy included in the proposed transfer and has given written notice of his claim to the transferor; (c) a copy of the application, of the report mentioned in sub-article (2)(a) and of any statement sent out under paragraph (b) of this sub-article has been served on the competent authority and that a period of not less than thirty days has elapsed since the date of service; (d) copies of the application and of the report mentioned in sub-article (2)(a) have been open to inspection (i) at each of the branches, agencies and offices in Malta of the undertakings concerned; (ii) where the transferor is (aa) an undertaking whose head office is in Malta which carries on business from Malta or in or from a country outside Malta, or (bb) a third country insurance undertaking which carries on business from Malta, and, as regards any policy included in the proposed transfer which evidences a contract of insurance, a country outside Malta is the country of the commitment, at such place in that country as the Tribunal has directed; for a period of not less than thirty days beginning with a date to be determined by the Tribunal; and that copies of the report have been made available for purchase from those offices and places during that period upon payment of such fee as may be fixed by the Tribunal; and (e) the notice and the statement referred to in this subarticle shall state that written representations concerning the transfer may be sent to the Tribunal within a period determined by the Tribunal.
\n
(4)On any application filed under sub-article (1): (a) the competent authority may be heard by the Tribunal; and (b) the competent authority and any policyholder who alleges that he would be adversely affected by the carrying out of the scheme and every other person who claims an interest in a policy included in the proposed transfer and has given notice of such interest to the transferor, shall be entitled to make written representations..
\n
INSURANCE BUSINESS
\n
(5)Subject to sub-article (6), the Tribunal shall not approve a transfer on an application filed before it under sub-article (1) unless it is satisfied that (a) (i) (ii) (iii) (b) (i) (ii) (iii) (iv) the transferee is, or immediately after the approval will be, authorised under article 7 to carry on long term business of the class or classes to be transferred under the scheme; the transferee is, or immediately after the approval will be, authorised under Article 14 or Article 162 of the Solvency II Directive, to carry on long term business of the class or classes to be transferred under the scheme in a Member State or an EEA State; or if the transferee does not fall within subparagraphs (i) and (ii), the transferee has the authorisation required to enable the business, or part which is to be transferred, to be carried on in the place to which it is to be transferred or will have it before the scheme takes effect; and the transferee referred to in sub-paragraph (i) of paragraph (a) of this sub-article, produces evidence that after taking the transfer into account, it possesses the necessary eligible own funds to cover the Solvency Capital Requirement required to be maintained under this Act; the transferee referred to in sub-paragraph (ii) of paragraph (a) of this sub-article, produces evidence that after taking the transfer into account, it possesses the necessary eligible own funds to cover the Solvency Capital Requirement provided for in Article 100 of the Solvency II Directive; or if the transferee does not fall within subparagraphs (i) and (ii), the transferee possesses, or will possess before the scheme takes effect, the solvency requirements required of it by, or under, the law applicable in the place to which the business is being transferred; (aa) if the transferee is authorised under this Act, its financial resources are, consequential to the transfer, adequate to fulfil the other obligations required of it by, or under, this Act; or (bb) if the transferee is a third country insurance undertaking, the transferee’s financial resources are, consequential to the transfer, adequate to fulfil the other obligations required of it by, or under, the law applicable in the place to which the business is being transferred;
\n
INSURANCE BUSINESS (c) if the transferor is an undertaking whose head office is in Malta, and the establishment from which the policies are to be transferred is situated in a Member State or EEA State (i) the European regulatory authority in that Member State or EEA State has been consulted about the proposed transfer; and (ii) the European regulatory authority has either responded or the period of three months beginning with the consultation has elapsed.
\n
(6)Where the transferor is an undertaking which carries on business from Malta or in or from a country outside Malta and, as regards any policy included in the proposed transfer which evidences a contract of insurance, a country outside Malta is the country of the commitment, the Tribunal shall not approve the transfer unless the competent authority certifies (a) that the European regulatory authority in that country has been notified; or (b) the overseas regulatory authority has been notified of the proposed transfer; and (c) either that the European regulatory authority or the overseas regulatory authority has consented to the scheme or that any such authority has not refused its consent to the scheme within the period of three months beginning with the date of the notification.
\n
(7)Where a scheme is approved by the Tribunal under this article the transferee shall, within ten days from the date on which the approval is made or such longer period as the Tribunal may allow, deposit two office copies of the approval with the competent authority.
\n
Provisions supplementary to article 35.
\n
Amended by:
\n
XXXIII. 2015.37.
\n
Art. 36
\n
36.Where the Tribunal approves a scheme under article 35, the long term business referred to in the application may be transferred to the transferee without any further need of any document evidencing the consent of the policyholder and of every other person who claims an interest in a policy included in the proposed transfer and notwithstanding any opposition by the policyholder and every other person who claims an interest in a policy included in the proposed transfer. The Tribunal may make provision for such incidental, consequential and supplementary matters as are necessary to secure that the scheme shall be fully and effectively carried out; and, where such be the case, for the continuation by or against the transferee of any legal proceedings pending by or against the transferor which relate to the scheme.
\n
INSURANCE BUSINESS
\n
Art. 37
\n
37.Where an undertaking authorised under this Act carrying on business restricted to reinsurance (\"the transferor\") proposes to transfer all or part of its business, the competent authority shall not approve a transfer unless it is satisfied that: (a) (i) (ii) (iii) (b) (i) (ii) (iii) (c) (i) (ii) the transferee is, or immediately after the approval will be, authorised under article 7 to carry on business of reinsurance; the transferee is, or immediately after the approval will be, authorised under Article 14 or 162 of the Solvency II Directive, to carry on in a Member State or an EEA State, business of reinsurance to be transferred under the scheme; or if the transferee does not fall within subparagraphs (i) and (ii), the transferee has the authorisation required (if any) to enable the business, or part which is to be transferred, to be carried on in the place to which it is to be transferred or will have it before the scheme takes effect; and the transferee referred to in sub-paragraph (i) of paragraph (a) possesses, after taking the proposed transfer into account, the necessary eligible own funds to cover the Solvency Capital Requirement required to be maintained under this Act; the transferee referred to in sub-paragraph (ii) of paragraph (a) possesses, after taking the proposed transfer into account, the necessary eligible own funds to cover the Solvency Capital Requirement referred to in Article 100 or 166 of the Solvency II Directive; or if the transferee does not fall within subparagraphs (i) and (ii), the transferee satisfies the solvency requirements required of it by, or under, the law applicable in the place to which the business is being transferred; if the transferee is an undertaking authorised under this Act, the transferee’s financial resources are, consequential to the transfer, adequate to fulfil the other obligations required of it by or under this Act; if the transferee is a third country reinsurance undertaking, the transferee’s financial resources are, consequential to the transfer, adequate to fulfil (if any) the other obligations required of it by, or under, the law applicable in the place to which the business is being transferred.
\n
Transfer of business restricted to reinsurance.
\n
Amended by:
\n
XVII. 2002.254.
\n
Deleted by:
\n
XII. 2009.98.
\n
Added by:
\n
XX. 2007.132.
\n
Amended by:
\n
XXXIII. 2015.38.
\n
Transfer of business of insurance to an authorised insurance or reinsurance undertaking.
\n
Added by:
\n
XXXIII. 2015.39.
\n
INSURANCE BUSINESS
\n
Art. 37A
\n
37A. (1) Where it is proposed to carry out a transfer of business of insurance under which the whole or part of the general business or long term business of an insurance or reinsurance undertaking is to be transferred to an undertaking authorised under this Act (\"the transferee\") by an undertaking whose head office is in a country outside Malta, the transferee shall notify the competent authority of the particulars of the proposed transfer and no such transfer shall take place unless and until the competent authority has signified its consent in writing.
\n
(2)Where the competent authority has required a recovery plan or a finance scheme in terms of article 16 or 18, it shall refrain from issuing a certificate of solvency for the purposes of this Part of this Act for as long as it considers that the rights of policyholders or the c o n t r a c t u a l o b l i ga t i o n s o f t h e r e i n s u r a nc e u n d e r t a k i n g a r e prejudiced.
\n
PART IX
\n
ACQUISITION AND DISPOSAL OF SHARES, WITHDRAWAL, DISSOLUTION AND WINDING UP Changes in shareholding of an authorised undertaking.
\n
Amended by:
\n
XVII. 2002.255;
\n
XIII. 2004.116;
\n
XII. 2006.99;
\n
XX. 2007.133;
\n
III. 2009.26.
\n
Substituted by:
\n
XVII. 2009.31.
\n
Amended by:
\n
XXXIII. 2015.40, 77.
\n
Art. 38
\n
38.(1) Notwithstanding anything contained in any other law, any person or persons acting in concert (hereinafter referred to in this Act as the \"proposed acquirer\"), who have taken a decision either to (a) acquire, directly or indirectly, a qualifying shareholding in an authorised insurance or reinsurance undertaking; (b) increase, directly or indirectly, an existing shareholding which is not a qualifying shareholding so as to cause it to become a qualifying shareholding in an authorised insurance or reinsurance undertaking; or (c) further increase, directly or indirectly, such qualifying shareholding in an authorised insurance or reinsurance undertaking as a result of which the proportion of the voting rights or of the capital held would reach or exceed twenty per centum, thirty per centum or fifty per centum or so that the authorised insurance or reinsurance undertaking would become its subsidiary, (hereinafter referred to as the \"proposed acquisition\"), shall notify the competent authority in writing of any such decision, indicating the size of the intended shareholding and providing any relevant information as and in the manner that the competent authority may by Insurance Rules require, including the form in which such notification shall be made and the criteria adopted by the competent authority in determining whether such person is a fit and proper person.
\n
(2)Notwithstanding anything contained in any other law, any person who has taken a decision either to (a) dispose, directly or indirectly, of a qualifying shareholding in an authorised insurance or reinsurance undertaking;
\n
INSURANCE BUSINESS (b) reduce, directly or indirectly, a qualifying shareholding so as to cause it to cease to be a qualifying shareholding; or (c) reduce, directly or indirectly, a qualifying shareholding so that the proportion of the voting rights or of the capital held would fall below twenty per centum, thirty per centum or fifty per centum or so that the authorised insurance or reinsurance undertaking would cease to be its subsidiary, shall notify the competent authority in writing of any such decision indicating the size of the intended shareholding and providing any relevant information as and in the manner that the competent authority may by Insurance Rules require.
\n
(3)Sub-articles (1) and (2) shall apply irrespective of whether or not any of the relevant shares are shares listed on any regulated market.
\n
(4)Notwithstanding the provisions of sub-articles (1) and (2), it shall be the duty of an authorised insurance or reinsurance undertaking and of the directors thereof, to notify the competent authority forthwith upon becoming aware that any person intends to take any of the actions set out in these sub-articles.
\n
(5)If any person or any authorised insurance or reinsurance undertaking takes or intends to take any action set out in sub-article
\n
(1)or (2) without notifying the competent authority or obtaining its approval in terms of article 38A, then, without prejudice to any other penalty which may be imposed under this Act, the competent authority shall have the power to make an order: (a) restraining such person or authorised insurance or reinsurance undertaking from taking, or continuing with, such action; (b) declaring such action to be void and of no effect; (c) requiring such person or authorised insurance or reinsurance undertaking to take such steps as may be necessary to restore the position existing immediately before the action was taken; (d) restraining such person or authorised insurance or reinsurance undertaking from exercising any rights which such action would, if lawful, have conferred upon them, including the right to receive any payment or to exercise any voting rights attaching to the shares acquired; (e) restraining such person or authorised insurance or reinsurance undertaking from taking any similar action or any other action within the categories set out in subarticles (1) and (2).
\n
(6)Without prejudice to any other provision of this Act, where the influence exercised by any person acquiring or proposing to acquire a qualifying shareholding is, or is likely to, operate against the sound and prudent management of an authorised insurance or INSURANCE BUSINESS reinsurance undertaking, the competent authority may exercise any of its powers under this Act to put an end to such situation, including the power to issue directives as it may deem reasonable in the circumstances.
\n
(7)In the case of a third country insurance or reinsurance undertaking authorised under this Act to carry on in or from Malta the business of insurance, the provisions of this article shall apply to the extent only of requiring such undertaking to give to the competent authority, not later than thirty days from such change or occurrence, as the case may be, the information therein referred to.
\n
(8)The competent authority, may, by means of Insurance Rules issued under this Act, indicate the circumstances when persons are to be regarded as \"acting in concert\".
\n
Assessment procedure.
\n
Added by:
\n
XVII. 2009.32.
\n
Amended by:
\n
XXXIII.2015.41,77 XXVI.2018.74.
\n
Art. 38A
\n
38A. (1) The competent authority shall, promptly and in any event within two working days following receipt of the notification required under article 38(1), as well as following the possible subsequent receipt of the information referred to in sub-article (4), acknowledge receipt thereof in writing to the proposed acquirer.
\n
(2)The competent authority shall have a maximum of sixty working days as from the date of the written acknowledgement of receipt of the notification required under article 38(1) and all documents required by the competent authority to be attached to such notification (hereinafter referred to in this Act as the \"assessment period\") to carry out an assessment on the basis of such information as may be determined by Insurance Rules issued for this purpose.
\n
(3)The competent authority shall inform the proposed acquirer of the date of the expiry of the assessment period at the time of acknowledging receipt.
\n
(4)The competent authority may, during the assessment period, if necessary and no later than on the fiftieth working day of such period, request any further information that is necessary to complete the assessment. Such a request shall be made in writing and shall specify the additional information needed.
\n
(5)During the period between the date of request for additional information by the competent authority and the receipt of a response thereto by the proposed acquirer, the assessment period shall be interrupted. The interruption period shall not exceed twenty working days. Any further requests by the competent authority for completion or clarification of the information shall be at its discretion but shall not result in an interruption of such assessment period.
\n
(6)The competent authority may extend the interruption period referred to in sub-article (5) up to thirty working days if the proposed acquirer is: (a) situated or regulated in a non-Member State or nonEEA state; or (b) a person not subject to supervision under:
\n
INSURANCE BUSINESS (i) Directive 2014/65/EU of the European Parliament and of the Council of 15 May 2014 on markets in financial instruments and amending Directive 2002/92/EC and Directive 2011/61/EU (recast); (ii) Directive 2013/36/EU of the European Parliament and of the Council of 26 June 2013 on access to the activity of credit institutions and the prudential supervision of credit institutions and investment firms, amending Directive 2002/ 87/EC and repealing Directives 2006/48/EC and 2006/49/EC; (iii) Directive 2009/65/EC of the European Parliament and of the Council of 13 July 2009 on the co-ordination of laws, regulations and administrative provisions relating to undertakings for collective investment in transferable securities (UCITS)(recast); (iv) the Solvency II Directive.
\n
(7)The competent authority shall, upon completion of the assessment referred to in sub-article (2) and not later than the date of the expiry of the assessment period, issue a notice: (a) granting unconditional approval to the proposed acquisition; (b) granting approval to the proposed acquisition subject to such conditions as the competent authority may deem appropriate; or (c) refusing the proposed acquisition.
\n
(8)In making the assessment referred to in sub-article (2), the competent authority shall neither impose any prior conditions in respect of the level of shareholding that must be acquired nor examine the proposed acquisition in terms of the economic needs of the market.
\n
(9)The competent authority may refuse the proposed acquisition only if there are reasonable grounds for doing so on the basis of the criteria set out in the Insurance Rules referred to in article 38(1) or if the information provided by the proposed acquirer is incomplete.
\n
(10)If the competent authority decides to refuse the proposed acquisition, it shall, within two working days, and not exceeding the assessment period, inform the proposed acquirer in writing specifying the reasons for such decision. The competent authority may, whether at the request of such proposed acquirer or not, issue a public statement indicating such reasons.
\n
(11)If the competent authority does not refuse the proposed acquisition in writing within the assessment period, such proposed acquisition shall be deemed to be approved.
\n
(12)Without prejudice to any other measure which may be taken under this Act, where a qualifying shareholding in an authorised insurance or reinsurance undertaking is acquired notwithstanding INSURANCE BUSINESS t h e r e f u s a l o f t h e c o m p et en t a u t h o r i t y, t h e e x e r c i s e o f t h e corresponding voting rights shall be suspended and any of the votes cast in contravention of this article shall be null and void.
\n
(13)The competent authority may fix a maximum period for concluding the proposed acquisition and extend it where appropriate.
\n
(14)Notwithstanding the provisions of sub-articles (1) to (6), where two or more proposals to acquire or increase qualifying shareholdings in the same authorised insurance or reinsurance undertaking have been notified to the competent authority, the latter shall treat the proposed acquirers in a non-discriminatory manner.
\n
Co-operation with European regulatory authorities or overseas regulatory authorities.
\n
Added by:
\n
XXVII. 2009.33.
\n
Amended by:
\n
XXXIII. 2015.42.
\n
Art. 38B
\n
38B. (1) The competent authority shall work in full consultation with European regulatory authorities when carrying out the assessment referred to in article 38A if the proposed acquirer is one of the following: (a) a credit institution, insurance undertaking, reinsurance undertaking, investment firm or UCITS management company authorised in another Member State or EEA State or in a sector other than that in which the acquisition is proposed; (b) the parent undertaking of a credit institution, insurance undertaking, reinsurance undertaking, investment firm or UCITS management company authorised in another Member State or EEA State or in a sector other than that in which the acquisition is proposed; or (c) a person controlling a credit institution, insurance undertaking, reinsurance undertaking, investment firm or UCITS management company authorised in another Member State or EEA State or in a sector other than that in which the acquisition is proposed.
\n
(2)The competent authority shall, without undue delay, provide any information which is essential or relevant for the assessment referred to in article 38A to the European regulatory authority requesting such information. Upon request, the competent authority shall communicate to the European regulatory authority all relevant information and shall communicate on its own initiative all essential information. A decision by the competent authority in terms of article 38A shall indicate any views or reservations expressed by the European regulatory authority responsible for the proposed acquirer.
\n
(3)The procedure set out in sub-articles (1) and (2) shall apply mutatis mutandis where the proposed acquirer is authorised or established in a third country.
\n
INSURANCE BUSINESS
\n
Art. 38C
\n
38C. (1) Notwithstanding anything contained in any other law and without prejudice to article 38(1) and (2), the consent of the competent authority given in writing shall be required before an authorised undertaking may lawfully: (a) merge with any other undertaking, whether authorised under this Act or not; (b) undergo any reconstruction or division; or (c) increase or reduce its nominal or issued share capital or effect any material change in voting rights.
\n
(2)It shall be the duty of all directors and qualifying shareholders of an authorised undertaking to notify the competent authority forthwith in writing upon becoming aware that such undertaking intends to take any of the actions set out in sub-article
\n
(1).
\n
(3)Within three months of receipt of such notification or receipt of such information as the competent authority may lawfully require, whichever is the later, the competent authority shall issue a notice (a) granting unconditional consent to the taking of the action; (b) granting consent to the taking of the action subject to such conditions as the competent authority may deem appropriate; or (c) refusing consent to the taking of the action, and if it refuses to grant consent it shall inform the person or the authorised undertaking concerned in writing of the reason for its refusal.
\n
(4)If any person or any authorised undertaking takes or decides to take any action set out in sub-article (1) without obtaining the consent of the competent authority, then, without prejudice to any other penalty which may be imposed under this Act, the competent authority shall have the power to make an order: (a) restraining such person or authorised undertaking from taking or continuing with such action; (b) declaring such action to be void and of no effect; (c) requiring such person or authorised undertaking to take such steps as may be necessary to restore the position existing immediately before the action was taken; (d) restraining such person or authorised undertaking from exercising any rights which such action would, if lawful, have conferred upon them, including the right to receive any payment or to exercise any voting rights attaching to the shares acquired; (e) restraining such person or authorised undertaking from taking any similar action or any other action within the categories set out in sub-article(1).
\n
Mergers, reconstructions, divisions and changes in share capital or voting rights.
\n
Added by:
\n
XXVII. 2009.34.
\n
Amended by:
\n
XXXIII. 2015.43.
\n
Undertakings ceasing to carry on business.
\n
Amended by:
\n
XVII. 2002.256;
\n
XII. 2006.100;
\n
XXXIII. 2015.44, 77.
\n
INSURANCE BUSINESS
\n
Art. 39
\n
39.(1) Subject to the following provisions of this article, if an authorised insurance undertaking intends to cease either wholly or partly to carry on the business it is authorised to carry on, such undertaking shall, not later than six months before the date on which it intends to cease to carry on such business, give notice thereof in writing to the competent authority and the authorised insurance undertaking shall comply with any provision of this Act that may be required of it in such circumstances.
\n
(2)Where an authorised insurance undertaking gives notice to the competent authority under sub-article (1), the competent authority (a) shall require the undertaking to (i) give publicity to the matter, amongst its policyholders and in the press in the form and manner as may be determined by Insurance Rules made for the purpose of this article; (ii) discharge all its liabilities to its policyholders and creditors in a manner acceptable to the competent authority; (iii) appoint a person which shall service or, as the case may be, run-off such business; and (b) may require the undertaking to ascertain that its technical provisions meet the requirements of article 18E.
\n
(3)The competent authority shall, not later than thirty days before the proposed date on which an authorised insurance undertaking as aforesaid intends to cease to carry on the business it is authorised to carry on, issue a permit to the authorised insurance undertaking concerned (a) authorising it to cease to carry on such business and to service or run-off that business, as from a specified date; (b) specifying the conditions under which such service or run-off shall be carried out; and (c) authorising a person to carry out such service or runoff.
\n
Undertakings carrying out servicing or run-off of business of insurance.
\n
Amended by:
\n
XXXIII. 2015.45.
\n
Art. 40
\n
40.Every authorised insurance undertaking issued under article 39 with a permit authorising it to cease to carry on the business it is authorised to carry on shall not, as from the date specified in the permit (\"the specified date\"), effect and carry out any new contracts of insurance in the business mentioned in the permit but shall (a) in the case of long term business, service or cause the person named in the permit to service on its behalf; (b) in the case of general business run-off or cause the person named in the permit to run-off on its behalf, contracts of insurance effected and carried out by it before the specified date.
\n
INSURANCE BUSINESS
\n
Art. 40A
\n
40A. The provisions of articles 39 and 40 shall apply mutatis mutandis to undertakings whose business is restricted to reinsurance.
\n
Reinsurance undertakings ceasing and carrying out servicing or run-off of business of insurance.
\n
Added by:
\n
XXXIII. 2015.46.
\n
Art. 41
\n
41.(1) Without prejudice to the provisions contained in article 42 and subject to the following provisions of this article - Reorganisation, dissolution and winding up of authorised undertakings.
\n
Amended by:
\n
XVII. 2002.257;
\n
XIII. 2004.117;
\n
XX. 2007.134;
\n
XXXIII. 2015.47;
\n
XXVI.2018.75. (a) in the case of an authorised insurance undertaking whose head office is in Malta: (i) where any reorganisation measures are adopted in relation to the undertaking, such measures shall be applied in accordance with regulations made for the purposes of this article; (ii) such undertaking shall, dissolve and consequentially wind up under and in accordance with regulations made under this article; and (b) in the case of a branch in Malta of an authorised third country insurance undertaking: (i) (ii) where any reorganisation measures are adopted in relation to the branch, such measures shall be applied in accordance with regulations made for the purposes of this article; such branch shall dissolve and consequentially wind up under and in accordance with regulations made for the purposes of this article.
\n
(2)Where it appears to the competent authority that an authorised insurance undertaking is, for any reason whatever, likely to dissolve and wind up, or has given notice of dissolving and winding up, or is being dissolved and wound up, the competent authority shall (a) in the case of an undertaking whose head office is in Malta, prohibit the free disposal of the assets of the undertaking whether such assets are situated in Malta or in country outside Malta; and (b) in the case of an authorised third country insurance undertaking, prohibit the free disposal of the assets of the undertaking situated in Malta or in any other country if such assets relate to the undertaking’s business in Malta, if such prohibition has not been imposed on the insurance undertaking by virtue of or under any other provision of this Act.
\n
(3)Notwithstanding the provisions of any other law, the assets of an authorised insurance undertaking which are prohibited under sub-article (2) or by virtue of or under any other provision of this Act to be freely disposed of shall be available only for meeting the liabilities of the undertaking attributable to its business of INSURANCE BUSINESS insurance:
\n
Provided that debts and other liabilities arising out of contracts of insurance attributable to its business of insurance shall rank before any other claim against such assets.
\n
(4)Where the value of the assets mentioned in sub-article (3) exceeds the amount of the liabilities mentioned in that sub-article the restriction imposed by that sub-article shall not apply to so much of those assets as represents the excess.
\n
(5)In so far as the provisions of this article are inconsistent with the provisions of any other law, the provisions of this article shall prevail, and the provisions of any other law shall, to the extent of the inconsistency, not apply to such undertakings.
\n
(6)The Minister may, after consultation with the competent authority, make regulations in respect of the winding-up or reorganisation of authorised insurance undertakings whose head office is in Malta, including their branches, if any, and of branches of third country insurance undertakings, and different provisions may be made for different cases or classes of cases, and account shall be taken of Malta’s international commitments in this regard.
\n
Such regulations may provide for the implementation of detailed re-organisation measures and procedures, including the following matters: the publication and submission of information in such language or languages and in such newspapers or other publications as may be prescribed, the submission of information to creditors, and the manner and procedure thereof, the notification to creditors and the procedure for the submission of claims or representations, measures for the protection of the rights of creditors and other third parties, including set-off arrangements; consultation between the competent authority and any other regulatory, administrative or judicial authorities in Malta and outside Malta with competence over the winding-up or re-organisation of such undertakings or of branches thereof; the publication of decisions relating to such winding-up or re-organisation procedures; the establishment of rules governing the applicability of the proper or applicable law and other issues of conflict of laws.
\n
(7)Where an authorised insurance or reinsurance undertaking takes a decision to dissolve and wind up, it shall immediately notify, in writing, the competent authority of such decision before taking any further action to that effect.
\n
(8)(a) An authorised reinsurance undertaking with its head office in Malta shall dissolve and wind up in accordance with the provisions of the Companies Act. (b) An authorised third country reinsurance undertaking shall dissolve and wind up in accordance with the laws of the country where the head office of such undertaking is situated governing the dissolution and winding up of such undertakings.
\n
INSURANCE BUSINESS
\n
Art. 42
\n
42.(1) An authorised undertaking whose head office is in Malta, carrying on long term business may not be dissolved and consequently wound up voluntarily without the consent of the competent authority.
\n
(2)It shall be the duty of an authorised undertaking and the directors thereof, to notify the competent authority forthwith upon becoming aware of any measures to be taken in terms of sub-article
\n
(1).
\n
Dissolution and winding up of an authorised undertaking carrying on long term business.
\n
Amended by:
\n
XXXIII. 2015.48.
\n
(3)Without prejudice to the provisions contained in article 41, in the event of an undertaking as aforesaid being dissolved and wound up (a) the assets representing the technical provisions maintained by the undertaking in respect of its long term business shall be available only for meeting the liabilities of the undertaking attributable to that business; (b) the other assets of the undertaking shall be available only for meeting the liabilities of the undertaking attributable to its other business.
\n
(4)Where the value of the assets mentioned in either paragraph (a) or (b) of sub-article (3) exceeds the amount of the liabilities mentioned in either paragraph, the restriction imposed by that subarticle shall not apply to so much of those assets as represents the excess.
\n
PART X
\n
OBLIGATIONS ON UNDERTAKINGS
\n
Art. 43
\n
43.(1) The holder of an authorisation issued under this Act to carry on the business of insurance and the holder of a permit issued thereunder to service or run-off that business shall notify in writing the competent authority of any material changes in the documentation or information provided or required to be provided by or under this Act and any regulations, Insurance Rules or Conduct of Business Rules made thereunder, as soon as the holder becomes aware of such changes.
\n
(2)Without prejudice to article 38, an authorised insurance or reinsurance undertaking whose head office is in Malta shall (a) before making any addition or alteration to the memorandum or articles of association or other instrument constituting the undertaking, submit in writing to the competent authority particulars of the proposed addition or alteration for its prior consent; and no such addition or alteration shall be made or shall be registered, or shall take effect, whether it is registered or not, unless and until the competent authority has signified its consent in writing; and (b) at least once a year, inform the competent authority of the names of the persons holding a qualifying shareholding in the undertaking and the percentage of such holding; and the competent authority may, by Substituted by:
\n
XXVI.2018.76.
\n
Changes in documentation or information.
\n
Amended by:
\n
XVII. 2002.258;
\n
XII. 2006.101;
\n
XVII. 2009.35;
\n
XXXIII.2015.49;77 XXVI.2018.77.
\n
INSURANCE BUSINESS Insurance Rules made for the purposes of this article, determine the form, manner and content of the information to be forwarded to it and the date by which such information shall be forwarded shall also be established by that rule.
\n
(3)Without prejudice to the foregoing provisions of this article, an authorised insurance or reinsurance undertaking shall notify the competent authority on a continuous basis, with any change or circumstances which may give rise to the existence of close links.
\n
Statutory notice by an authorised undertaking in relation to long term policy.
\n
Amended by:
\n
XIII. 2006. 102;
\n
XXXIII. 2015.50.
\n
Art. 44
\n
44.(1) No insurance undertaking authorised under this Act to carry on long term business shall enter into a contract of insurance the effecting of which constitutes the carrying on of long term business, unless such undertaking either (a) has served on the other party to the contract by means as may be prescribed a statutory notice in relation to that contract; or (b) does so at the time when the contract is entered into.
\n
(2)Regulations under this article may be made with respect to any matter related to a statutory notice; and the regulations may exempt from any requirement contracts as may therein be prescribed.
\n
(3)For the purposes of this article a statutory notice is a notice which (a) contains such matters (and no others) and is in such form as may be prescribed and complies with such requirements as may be prescribed for securing that the notice is easily intelligible; and (b) has annexed to it a form of notice of cancellation of a description as may be prescribed for serving by means as may be prescribed a notice of cancellation on the authorised undertaking.
\n
Linked long term policies.
\n
Amended by:
\n
XXXIII. 2015.51.
\n
Art. 45
\n
45.Regulations may be made, as respects the matters as may therein be prescribed, in relation to contracts of insurance the effecting of which constitutes the carrying on of long term business and which (a) are entered into by an insurance undertaking whose head office is in Malta authorised under this Act to carry on long term business; and (b) are contracts under which the benefits payable to the policyholder are wholly or partly to be determined by reference to the value of, or the income from, property of any description (whether or not specified in the contract) or by reference to fluctuations in, or in an index of, the value of property of any description (whether or not so specified).
\n
INSURANCE BUSINESS
\n
Art. 46
\n
46.No contract of insurance shall be held void or voidable by an insurer by reason only that, at the time the contract is entered into, there is a breach of any provision of this Act or of the Insurance Distribution Act, (in this article referred to as \"the Act\") and of any regulations made under this Act or under the Act, or of any Insurance Rules or Conduct of Business Rules issued in virtue of this Act, or of any Insurance Distribution Rules or Conduct of Business Rules issued in virtue of the Act.
\n
Contracts of insurance not voidable by insurer notwithstanding a breach of this Act or of the Insurance Distribution Act.
\n
Substituted by:
\n
XII. 2006.103.
\n
Amended by:
\n
XXXIII. 2015.77;
\n
XXVI.2018.78.
\n
Art. 47
\n
47.(1) The competent authority may by Conduct of Business Rules made for the purposes of this article determine the language in which a contract of insurance relating to a risk which is a risk situated in Malta or to a commitment where Malta is the country of the commitment of a class or classes or part classes of business as may therein be specified is to be expressed.
\n
Contracts to be expressed in a specified language.
\n
Amended by:
\n
XVII. 2002.259;
\n
XII. 2006.104;
\n
XXXIII.2015.52,77 XXVI.2018.79.
\n
(2)In the absence of any such Conduct of Business Rules, the contract shall be expressed in the English language.
\n
(3)The provisions of this article shall not apply to an undertaking whose business in or from Malta is restricted to reinsurance.
\n
Art. 48
\n
48.(1) No insurance undertaking authorised under this Act shall issue or cause to be issued any advertisement or carry out or cause to be carried any promotional activity related to the business of insurance which misleads, or directly or by implication is likely to mislead, or deceive any prospective policyholder, or the insurance sector in general, or the general public with respect to its assets or corporate structure or financial standing or authorisation or any other material respect:
\n
Provided that, in the case of an undertaking whose head office is in Malta, the provisions of this sub-article shall also apply with respect to (a) an advertisement issued or caused to be issued; and (b) a promotional activity as aforesaid carried out or caused to be carried out, from Malta or in or from a country outside Malta.
\n
(2)The competent authority may by Conduct of Business Rules made for the purposes of this article determine the form and content of insurance advertisements and make different provision in relation to insurance advertisements of different classes or part classes or descriptions; and the manner in which any promotional activity as aforesaid shall be carried out or caused to be carried out.
\n
(3)The provisions of sub-article (2) shall not apply to an undertaking if its business is restricted to reinsurance.
\n
(4)Where an undertaking issues or causes to be issued an advertisement or carries out or causes to be carried out any promotional activity which is in breach of or does not comply with any of the provisions of sub-article (1) or (2), the competent authority may issue an order directing the undertaking - Insurance advertisements.
\n
Amended by:
\n
XVII. 2002.259;
\n
XII. 2006.105;
\n
XXXIII.2015.53,77 XXVI.2018.80.
\n
INSURANCE BUSINESS (a) to withdraw, wholly or partly, the advertisement or promotional activity; or (b) to amend any particular of the advertisement or promotional activity; or (c) to do such other thing as it deems appropriate in the circumstances.
\n
(5)If an undertaking refuses or fails to comply with any order issued by the competent authority under sub-article (4) or refuses or fails to comply with such order within the time specified therein, without prejudice to any penalty which the undertaking may incur under this Act, the competent authority shall have the power to enforce, at the expense of the undertaking concerned, the order issued by it under that sub-article.
\n
Provisions relating to Lloyd’s.
\n
Added by:
\n
XII. 2006.106.
\n
Amended by:
\n
XXXIII. 2015.54.
\n
Art. 48A
\n
48A. (1) For the purposes of this article, \"syndicate\" means a member or group of members of Lloyd’s underwriting business of insurance at Lloyd’s through the agency of a managing agent to which a particular syndicate number is assigned by or under the authority of the Council of Lloyd’s.
\n
(2)Where the members of Lloyd’s carry on business of insurance in Malta, they shall carry on such business in exercise of a European right.
\n
(3)Lloyd’s shall at all times have a representative in Malta who shall be resident in Malta and who shall be the representative in Malta of Lloyd’s and of each of its members.
\n
(4)The representative shall for the purposes of this Act be authorised to act generally as judicial representative of, and accept service of any document on behalf of, Lloyd’s and of each of its members and to file any judicial acts in the registry of any court or similar authority in Malta on behalf of Lloyd’s or any of its members. The general representative shall not be personally liable for the debts and obligations of Lloyd’s or any of its members and accordingly no execution of any precautionary or executive warrant against Lloyd’s or any of its members shall be made against Lloyd’s general representative.
\n
(5)It shall be sufficient in any judicial act (other than an application for the issue of any precautionary or executive warrant) filed by or against members of Lloyd’s in connection with a policy underwritten by them to file the act in the name of the Lloyd’s representative in Malta as representative of those members; provided the act commencing proceedings contains a statement that it is being filed in connection with a policy of insurance underwritten by members of Lloyd’s and giving particulars of the number reference and date of the policy in respect of which the act is filed, the identifying number of each of the syndicates subscribing thereto and, where known, the names of the members of Lloyd’s comprising those syndicates. This sub-article shall apply notwithstanding any provision to the contrary contained in the Code of Organization and Civil Procedure.
\n
(6)The Lloyd’s representative shall within forty-five days after INSURANCE BUSINESS the filing by him of the judicial act, or of its service on him, as the case may be, file a note in the records of the judicial act filed as aforesaid containing a list of the names of the members comprising the syndicates subscribing to the policy and any such note shall be deemed to be an integral part of the judgment or decree emanating from the court subsequent to the judicial act and such judgment or decree shall be binding on the members whose names are listed in the note in the same manner as it would so have bound them if they had been named as parties to the said judicial act:
\n
Provided that, the Lloyd’s representatives shall not be bound to file any such note following the filing of any judicial act w h e r e p a r t i c u l a r s o f t h e n a m e s o f t h e m e m b e r s o f L l o y d ’s comprising those syndicates are already contained in the act or where any such note has already been filed in the records of the case.
\n
(7)Any judicial act filed by or against Lloyd’s or any of its members in connection with a policy underwritten by them shall be served upon the Lloyd’s general representative in Malta at its registered address in Malta.
\n
Art. 48B
\n
48B. Every authorised insurance or reinsurance undertaking shall utilise the services of insurance intermediaries, reinsurance intermediaries, tied insurance intermediaries and ancillary insurance intermediaries which are: (a) enrolled under the Insurance Distribution Act; or (b) registered under Article 3 of the Insurance Distribution Directive, or falling under Article 1(3) of the Insurance Distribution Directive where applicable; or Appointment of intermediaries or ancillary insurance intermediaries.
\n
Added by:
\n
XII. 2006.107.
\n
Substituted by:
\n
XXXIII. 2015.55.
\n
Amended by:
\n
XXVI.2018.81. (c) registered or regulated to carry out such services in a non-Member State or non-EEA State in accordance with the provisions of the laws applicable in such State.
\n
Art. 48C
\n
48C. (1) An authorised undertaking shall not be required to subm it to the competent auth ority for it s prior app roval or systematically notify the competent authority of: (a) general and special policy conditions, of scales of premiums, of the technical bases used in particular for calculating scales of premiums and technical provisions, or of forms and other printed documents which the authorised undertaking intends to use in its dealings with policyholders or ceding or retro-ceding undertakings; (b) premium rates or proposed increases of premium rates, other than as part of general price-control systems.
\n
(2)Notwithstanding the provisions of sub-article (1), the competent authority may require: (a) in respect of general business, the notification of the policy conditions, other documents and information Policy conditions and scales of premiums.
\n
Added by:
\n
XXXIII. 2015.56.
\n
INSURANCE BUSINESS referred to in sub-article (1) for the purpose of verifying compliance with the law applicable to contracts of insurance; (b) in respect of long term business, the notification of the technical bases used in particular for calculating scales of premiums and technical provisions for the sole purpose of verifying compliance with any actuarial principles which may be established by this Act, regulations or Insurance Rules issued thereunder.
\n
Application of certain articles of the Insurance Distribution Act to insurance and reinsurance undertakings.
\n
Added by:
\n
XXVI.2018.82.
\n
Art. 48D
\n
48D. An authorised insurance undertaking and an authorised reinsurance undertaking carrying out insurance distribution activities and reinsurance distribution activities in terms of the Insurance Distribution Act shall comply with the applicable provisions of the said Act and of any regulations, Insurance Distribution Rules and Conduct of Business Rules issued thereunder.
\n
PART XI
\n
PROTECTION AND COMPENSATION FUND Establishment of the Protection and Compensation Fund.
\n
Amended by:
\n
XVII. 2002.260;
\n
XII. 2006.108;
\n
XXXIII. 2015.57.
\n
Substituted by:
\n
XXXII.2024.36.
\n
Art. 49
\n
(1)There shall be established a fund, as may be prescribed, which shall be known as the \"Protection and Compensation Fund\": (a) for the payment of any claims in respect of: (i) (ii) (b) risks and commitments against an insurance undertaking carrying on business of insurance in Malta, as may be prescribed under the Insurance Business (Protection and Compensation Fund) Regulations, remaining unpaid by reason of the insolvency of such undertaking, subject to such limitations, restrictions and exclusions as may be prescribed by the said regulations; and risks related to motor vehicle liability insurance business against an insurance undertaking carrying on motor vehicle liability insurance business from Malta, as may be prescribed in accordance with the Insurance Business (Protection and Compensation Fund) Regulations, remaining unpaid by reason of the insolvency of such undertaking, subject to such limitations, restrictions and exclusions as may be prescribed by the said regulations; and for the payment of compensation to victims of road traffic accidents as may be prescribed subject to such limitations and restrictions as may be prescribed.
\n
INSURANCE BUSINESS
\n
(2)Without prejudice to the provisions of this Act and of any regulations issued thereunder, the Protection and Compensation Fund shall be a body corporate having a distinct legal personality and shall be capable of entering into contracts, whether of borrowing or if otherwise incurring indebtedness for the purposes of its functions, acquiring, holding and disposing of any kind of property for the purposes of its functions; of suing or being sued, doing all such matters and entering into all such negotiations, transactions and agreements as are incidental or conducive to the exercise or performance of its functions. Without prejudice to the generality of the foregoing, the Protection and Compensation Fund shall for this purpose have the power to enter into such reasonable administrative, management or other arrangements as may be necessary to enable it to fulfil its objectives and functions under this Act and under the Insurance Business (Protection and Compensation Fund) Regulations, including to become a party to the agreement referred to in regulation 10A of the Insurance Business (General Provisions of Supervision) Regulations, and to delegate to any body or person any of its functions as the Management Committee appointed in accordance with the Insurance Business (Protection and Compensation Fund) Regulations deems necessary.
\n
Art. 50
\n
50.(1) The Protection and Compensation Fund shall comprise of different funds as may be prescribed by the Insurance Business (Protection and Compensation Fund) Regulations, of all contributions made thereto in accordance with this Act and any regulations made thereunder, and of all other assets and revenues pertaining to it. The assets of every fund shall be kept separate and separately identifiable from the assets of the other Funds, as may be prescribed in the said regulations.
\n
S.L. 403.24.
\n
S.L. 403.25.
\n
Contributions to the Protection and Compensation Fund.
\n
Amended by:
\n
XII. 2006.109;
\n
XXXIII. 2015.58;
\n
XXXII.2024.37.
\n
(2)All insurance undertakings, as prescribed by the regulations, which carry on business of insurance in Malta shall contribute to the Protection and Compensation Fund in such amounts and to such limitations as shall be prescribed and different amounts and limitations may be prescribed with respect to different kinds of business of insurance or different classes or part classes thereof, or different kinds of insurance undertakings, or in view of other different circumstances.
\n
(3)Insurance undertakings which carry on motor vehicle liability insurance business from Malta, as may prescribed by the Insurance Business (Protection and Compensation Fund) Regulations, shall contribute to the Protection and Compensation Fund in such amounts and to such limitations, as may be prescribed by the Insurance Business (Protection and Compensation Fund) Regulations, and different amounts and limitations may so apply as may be prescribed in the said regulations.
\n
Art. 51
\n
51.(1) The Protection and Compensation Fund shall be managed and otherwise dealt with in accordance with regulations made for the purposes of this Act:
\n
Provided that such regulations shall ensure that: (a) payments made into the Protection and Compensation Management of the Protection and Compensation Fund.
\n
Amended by:
\n
XXXIII. 2015.59.
\n
XXXII.2024.38.
\n
INSURANCE BUSINESS Fund by undertakings to carry on long term business in Malta shall be utilised for compensation with respect to long term business, and shall be treated separately and utilised exclusively for compensation of claims relating to long term business; (b) payments made into the Protection and Compensation Fund by undertakings to carry on general business in Malta shall be treated separately, and shall be utilised exclusively for compensation of claims relating to general business:
\n
Provided that payments made into the Protection and Compensation Fund by undertakings carrying on motor vehicle liability insurance business in Malta, on or after the initiation date as defined herein, shall be treated separately from general business, and shall be utilised exclusively for compensation of claims relating to such motor vehicle liability insurance business carried on in Malta, on or after such date; and (c) payments made into the Protection and Compensation Fund by undertakings carrying on motor vehicle liability insurance business from Malta shall also be treated separately and shall be utilised exclusively for compensation of claims relating motor vehicle liability insurance business carried on from Malta.
\n
(2)For the purposes of this article, \"initiation date\" means: (a) the date of the entry into force of the agreement referred to in the first sub-paragraph of Article 10a(13) and the first sub-paragraph of Article 25a(13) of Directive 2009/ 103/EC of the European Parliament and of the Council of 16 September 2009 relating to insurance against civil liability in respect of the use of motor vehicles and the enforcement of the obligation to insure against such liability, as amended from time to time; or (b) the date of application of the Commission delegated act referred to in the fourth sub-paragraph of Article 10a(13) and the fourth sub-paragraph of Article 25a(13) of the said Directive mentioned in paragraph (a), whichever is the earlier.
\n
Prescription in respect of claims for payment out of the Protection and Compensation Fund.
\n
Amended by:
\n
XXXIII. 2015.60;
\n
XXXII.2024.39.
\n
Art. 52
\n
52.No claim for payment of compensation shall be made out of the Protection and Compensation Fund unless such claim is made (a) with respect to a claim in accordance with article 49(a)(i), within two years from the date that the name of the undertaking is struck off the register established in the Companies Act or such undertaking is otherwise definitely wound up, in those circumstances only where compensation would be due from Fund A; (aa) with respect to a claim in accordance with article 49(a)(ii), within the period and in the manner prescribed by the Insurance Business (Protection and Compensation Fund) Regulations;\"; and INSURANCE BUSINESS (b) with respect a claim in accordance with article 49(b), within two years from the date of occurrence of the accident relating to that claim:
\n
Provided that for the purposes of this article, the words \"Fund A\" shall have the same meaning as assigned to them under the Insurance Business (Protection and Compensation Fund) Regulations.
\n
Art. 53
\n
53.All contributions made to the Protection and Compensation Fund and any income and assets belonging to the Protection and Compensation Fund shall be exempted from any liability for the payment of income tax under any law for the time being in force.
\n
Exemptions from income tax.
\n
Substituted by:
\n
XVII. 2002.261.
\n
Amended by:
\n
XXXII.2024.40.
\n
Art. 54
\n
54.The Minister may, after consultation with the competent authority, make regulations to better implement the provisions of this Part, including the transposition of any requirement or provision as may arise under a Directive, Regulation or Decision of the European Union or any other similar measure.
\n
Power to issue regulations under this Part of the Act.
\n
Amended by:
\n
XVII. 2002.262.
\n
Substituted by:
\n
XII. 2006.110.
\n
PART XII
\n
GENERAL PROVISIONS
\n
Art. 55
\n
55.(1) Notwithstanding the provisions of article 59, the competent authority shall co-operate and exchange information: (a) with European regulatory authorities, and the European Commission for the purpose of facilitating the supervision of insurance and reinsurance within the European Union and the application of the Solvency II Directive; (b) with overseas regulatory authorities for the purposes of the exercise of one or more of their regulatory functions; (c) with authorities or bodies, or persons listed in subarticle (2).
\n
(2)The competent authority shall co-operate and exchange information with: (a) authorities responsible for the supervision of credit institutions and other financial organisations and the authorities responsible for the supervision of financial markets; (b) bodies involved in the liquidation and insolvency of insurance or reinsurance undertakings and in other similar procedures; (c) the authorities responsible for overseeing the bodies involved in the liquidation and insolvency of insurance undertakings, reinsurance undertakings and other similar procedures; (d) persons responsible for carrying out statutory audits of the accounts of insurance undertakings, reinsurance undertakings and other financial institutions;
\n
Co-operation in supervisory duties and sharing of information.
\n
Substituted by:
\n
XVII. 2002.263;
\n
XXXIII. 2015.61.
\n
Amended by:
\n
XLVI.2021.62.
\n
INSURANCE BUSINESS (e) bodies which administer compulsory winding-up proceedings or guarantee funds, where that information is necessary for the performance of their duties; (f) the authorities or bodies responsible for the detection and investigation of breaches of company law; (g) the authorities responsible for overseeing the persons charged with carrying out statutory audits of the accounts of insurance undertakings, reinsurance undertakings, credit institutions, investment firms and other financial institutions; (h) actuaries appointed by insurance or reinsurance undertakings carrying out actuarial tasks in relation to those undertakings and the bodies responsible for overseeing such actuaries; and (i) authorities responsible for supervising credit institutions and financial institutions as defined in Article 3 of Directive (EU) 2015/849 of the European Parliament and of the Council, for the purposes of ensuring compliance with the said Directive.
\n
(3)For the purposes of the exchanges of information referred to in paragraphs (c), (g) and (h) of sub-article (2), the following conditions, as a minimum, shall be met by the recipient of such information: (a) the information required must be for the purpose of carrying out the overseeing or supervision of the functions or activities of such authorities, bodies or persons; (b) the information received by such authorities, bodies or persons shall be subject to the duty of professional secrecy; (c) where the information in the possession of the competent authority originates from a European regulatory authority or an overseas regulatory authority, it shall not be disclosed without the express consent of the European regulatory authority or the overseas regulatory authority from which it originates and, where appropriate, solely for the purposes for which that authority gave its consent.
\n
(4)For the purposes of exchanges of information referred to in paragraph (f) of sub-article (2), the competent authority shall ensure that, as a minimum, the following conditions shall be met by the recipient of such information: (a) the information exchanged shall be intended for the purpose of the detection and investigation of breaches of company law; (b) the information received shall be subject to the duty of professional secrecy; (c) where the information in the possession of the INSURANCE BUSINESS competent authority originates from a European regulatory authority or an overseas regulatory authority, it shall not be disclosed without the express agreement of the European regulatory authority or the overseas regulatory authority from which it originates and, where appropriate, solely for the purposes for which the authority gave its agreement; (d) such recipient shall provide the name and responsibilities of the persons to whom such information shall be sent:
\n
Provided that, where the authorities or bodies perform their tasks of detection or investigation with the assistance of persons appointed for that purpose, in view of their specific competence, and such persons are not employed with such bodies or persons, such information may only be exchanged with such persons if the conditions set out in this sub-article are met.
\n
(5)The competent authority shall communicate to the Commission and to other Member States or EEA States the names of the authorities, persons or bodies which may receive information in terms of this article.
\n
(6)(a) Without prejudice to the provisions of this article and article 59, the competent authority may transmit information intended for the performance of their tasks to the following: (i) the Central Bank of Malta, the central banks of the European System of Central Banks (including the European Central Bank) and other bodies with a similar function in their capacity as monetary authorities where this information is relevant to their respective statutory tasks, including the conduct of monetary policy and related liquidity provision, oversight of payments, clearing and securities settlement systems and safeguarding the stability of the financial system; (ii) where appropriate, other national public authorities responsible for overseeing payment systems; and (iii) the European Systemic Risk Board, where that information is relevant to carrying out its tasks. (b) In an emergency situation, including a situation as defined in Article 18 of Regulation (EU) No 1094/ 2010, the competent authority shall communicate, without delay, information to the central banks of the European System of Central Banks (including the European Central Bank) where that information is relevant to their statutory tasks, including the conduct of monetary policy and related liquidity provision, oversight of payments, clearing and securities settlement systems and safeguarding the stability of the financial system, and to the European Systemic INSURANCE BUSINESS Risk Board, where such information is relevant to its tasks. (c) Such authorities or bodies may also communicate to the competent authority such information as they may need for the purposes of article 59(4).
\n
(7)Without prejudice to article 59, the competent authority may exchange information with other departments of Member St a t e s c e n t r a l g o v e r n m e n t a d m i n i s t r a t i o n s r e s p o n s i b l e f o r legislation on the supervision of credit institutions, financial institutions, investment services and insurance and reinsurance undertakings and to inspectors acting on behalf of those departments provided that: (a) such disclosures may be made only where necessary for reasons of prudential control; (b) persons having access to such information shall be subject to professional secrecy.
\n
(8)Without prejudice to the foregoing provision of this article, the competent authority may exercise the following powers at the request of, or for the purposes of, assisting a European regulatory authority or an overseas regulatory authority: (a) the power to impose, revoke or vary conditions on the grant of an authorisation pursuant to the provisions of article 7; (b) the power to suspend or revoke an authorisation under article 26; (c) the power to take any action under article 28, in lieu of or in addition to any suspension or revocation of an authorisation; (d) the power to require information and documentation under article 29; (e) the power to appoint inspectors under article 30; (f) the power of entry to obtain information and documentation under article 31; (g) the power to issue a directive under article 31A; (h) the power to communicate to the European regulatory authority information in its possession, whether such information is the result of any of the above powers or otherwise; and (i) the power to prohibit the free disposal of the undertaking’s assets located in Malta in the circumstances referred to in Articles 137 to 139 and Article 144(2) of the Solvency II Directive; the undertaking’s home Member State shall designate the assets to be covered by such measures.
\n
(9)There shall be meetings between an authorised insurance or reinsurance undertaking, its approved auditors, and, in the case of an undertaking authorised to carry on long term business, its approved actuary and the competent authority on a bilateral or a INSURANCE BUSINESS multilateral basis as circumstances may warrant. Such meetings may be called by any of the parties, and shall in each case be chaired by the competent authority.
\n
Art. 55A
\n
55A. (1) The competent authority shall cooperate with EIOPA for the purposes of the Solvency II Directive in accordance with Regulation (EU) No 1094/2010.
\n
Co-operation with EIOPA.
\n
Added by:
\n
XXXIII. 2015.62.
\n
(2)The competent authority shall provide EIOPA with all information necessary to carry out its duties in accordance with Regulation (EU) No 1094/2010.
\n
Art. 55B
\n
55B. (1) The competent authority may enter into co-operation agreements with overseas regulatory authorities or with such authorities or bodies as defined in article 55(2), in countries that are not Member States or EEA States only if the information disclosed is subject to the guarantees of professional secrecy at least equivalent to those required under articles 55 and 59. Such exchange of information must be intended for the performance of the supervisory task of such overseas regulatory authorities, authorities or bodies.
\n
Co-operation with third countries.
\n
Added by:
\n
XXXIII. 2015.62.
\n
(2)Where the information to be disclosed by the competent authority to the authorities or bodies referred to in sub-article (1), had originated from a European regulatory authority, it may only be disclosed to an overseas regulatory authority with the express agreement of such European regulatory authority which had transmitted it and, where appropriate, solely for the purposes for which that authority had given its agreement.
\n
Art. 56
\n
56.(1) No duty (including the duty of professional secrecy) to which (a) an auditor or an actuary of an undertaking; or (b) a person appointed to make a report under article 30(1), may be subject, shall be regarded as contravened by reason of his communicating in good faith to the competent authority, whether or not in response to a request made by it, any information or opinion on a matter to which this article applies and which is relevant to any function of the competent authority under this Act.
\n
(2)In relation to an auditor or an actuary of an authorised undertaking, this article applies to any matter falling within article 24.
\n
(3)In relation to a person appointed to make a report under article 30(1), this article applies to any matter of which he becomes aware in his capacity as the person making the report which relates to the business or affairs of the undertaking in relation to which his report is made.
\n
(4)If it appears to the competent authority that any accountants or class of accountants who are persons to whom sub-article (1) applies are not subject to satisfactory rules made or guidelines issued by a professional body specifying circumstances in which Communication by auditors, etc., with the competent authority.
\n
Amended by:
\n
XXXIII. 2015.63.
\n
INSURANCE BUSINESS matters are to be communicated to the competent authority as mentioned in that sub-article, the competent authority may, after consultation with such bodies as appear to the competent authority to represent the interests of accountants and authorised undertakings, make rules for the purposes of this article, applying to those accountants and specifying such circumstances; and it shall be the duty of an accountant to whom the rules apply to communicate a matter to the competent authority in the circumstances specified by the rules.
\n
The Financial Services Tribunal.
\n
Amended by:
\n
XVII. 2002.264;
\n
XXXIII. 2015.64.
\n
Art. 57
\n
57.(1) For the purpose of this Act, the term \"Financial Services Tribunal\" means the tribunal referred to in article 21 of the Malta Financial Services Authority Act, and the term \"Tribunal\" shall be construed accordingly:
\n
Provided that for the purpose of proceedings arising under this Act the members appointed under article 21(4) of the Malta Financial Services Authority Act, shall be substituted by persons to be appointed by the Minister under this Act and who, in his opinion, possess the necessary expertise and experience in the business of insurance; and the provisions of article 21(5) to (7) of the said Act shall apply to the persons appointed pursuant to this proviso in the same manner and to the same extent as they apply to the members mentioned in article 21(2) of the said Act.
\n
(2)The Financial Services Tribunal shall, in addition to the functions and powers assigned to it under article 58, have the function and power to decide applications for transfer of long term business filed before it under this Act.
\n
(3)Upon determining an application for transfer of long term business, the Tribunal shall have the power to order the payment of costs and expenses by any party to the application.
\n
(4)The provisions of article 21 of the Malta Financial Services Authority Act and of any regulations made thereunder shall, except in so far as any of them is incompatible with the provisions of this article or of article 35 or 58, apply to applications for transfer of long term business and appeals made to the Financial Services Tribunal under this Act:
\n
Provided that regulations made under the said article 21 may distinguish between procedures made for the purposes of the provisions of this Act and procedures made for the purposes of the provisions of the Malta Financial Services Authority Act.
\n
(5)The Minister may, for the purposes of this article, subject to article 35, make regulations governing the procedure for determining an application for transfer of long term business filed under that article, provided that in the absence of such regulations the Tribunal shall regulate its own procedure.
\n
INSURANCE BUSINESS
\n
Art. 58
\n
58.(1) Subject to the provisions of this article, an appeal shall lie to the Financial Services Tribunal with respect to (a) any failure to inform an applicant within the term provided in sub-article (9) or (10) of article 7; (b) any refusal to issue an authorisation under articles 7 or 21;
\n
Appeals.
\n
Amended by:
\n
XIII. 2004.118;
\n
XVII. 2009.36;
\n
X. 2011.77;
\n
XXXIII. 2015.65;
\n
XXVI.2018.83. (c) any condition imposed in an authorisation issued or held under articles 7 or 21; (d) any suspension or revocation of an authorisation under article 26, or under any regulation made under this Act; (e) any one or more measures taken under article 28; (f) any directive given under article 31A; (g) any refusal of an application for transfer of general business under article 33; (h) any notice issued or any order made under articles 38, 38A and 38C; (i) any administrative penalty imposed in respect of infringements as may be prescribed under article 67. (1A) The Financial Services Tribunal shall have exclusive competence to hear appeals on the matters listed in sub-article (1).
\n
(2)The provisions of article 21 of the Malta Financial Services Authority Act shall apply mutatis mutandis to appeals that may be brought before the Tribunal under this article.
\n
Art. 59
\n
59.(1) Information obtained by the competent authority or by its officers, employees or agents, including former officers, employees or agents, as well as by inspectors, auditors and experts acting on behalf of the competent authority for the purposes of, or pursuant to, any of the provisions of this Act, or of any regulations made thereunder, or of any Insurance Rules, or in the discharge of any functions under any of the said provisions, shall be treated as confidential and protected by the duty of professional secrecy.
\n
(2)Without prejudice to cases covered by criminal law, the persons referred to in sub-article (1) shall not disclose information obtained from an authorised insurance or reinsurance undertaking unless such disclosure of information be done in summary or aggregate form, so as not to enable the identity of such undertaking, to whom such information relates, to be ascertained:
\n
Provided that, such persons may disclose confidential information in civil or commercial proceedings where an authorised insurance or reinsurance undertaking has been declared insolvent or is being compulsorily wound up, as long as such information does not concern third parties involved in attempts to rescue that undertaking.
\n
(3)Nothing in this Act shall authorise the competent authority to enquire or cause an enquiry to be made in an authorised insurance or reinsurance undertaking into the affairs of any Confidentiality.
\n
Amended by:
\n
XVII. 2002.265;
\n
XII. 2006.111;
\n
XX. 2007.135;
\n
X. 2011.78;
\n
XXXIII. 2015.66, 77.
\n
INSURANCE BUSINESS individual policyholder of the authorised insurance or reinsurance undertaking except for the purpose of ensuring compliance with any of the provisions of this or of any other Act.
\n
(4)Where the competent authority receives confidential information from a European regulatory authority under this article and article 55 it may only use such confidential information in the course of its duties and for the following purposes: (a) to check that the conditions governing the carrying on of business of insurance or reinsurance are met and to facilitate the monitoring of the carrying on of such business especially with regard to the monitoring of the technical provisions, the Solvency Capital Requirement, the Minimum Capital Requirement and the system of governance; (b) to impose penalties or adopt other administrative measures and to consider representations received in their regard; (c) in appeals against decisions of the competent authority under article 58; and (d) in judicial proceedings under the Solvency II Directive.
\n
(5)When an officer or an employee of an authorised insurance or reinsurance undertaking has reason to believe that a transaction or a proposed transaction could involve money laundering or the funding of terrorism, he shall act in compliance with the reporting and other obligations set out in the regulations made under article 12 of the Prevention of Money Laundering Act and any procedures and guidance issued thereunder, and such disclosure shall not constitute a breach of confidentiality.
\n
(6)In this article, any reference to agents has the meaning assigned to it in article 30(10).
\n
Communication of confidential information.
\n
Amended by:
\n
XX. 2007.136;
\n
XXXIII. 2015.67;
\n
XXVI.2018.84.
\n
Art. 60
\n
60.(1) Notwithstanding the provisions of the Professional Secrecy Act, article 257 of the Criminal Code shall not affect or prevent the exchange of information about policies, policyholders potential policyholders, insureds, claimants or other related parties (a) amongst insurance undertakings authorised to carry on the business of insurance (\"insurers\"); (b) amongst companies or persons registered or enrolled under the Insurance Distribution Act (\"intermediaries\"); (c) between insurers and intermediaries; (d) between insurers, or intermediaries, or insurers and intermediaries, and the Commissioner of Police, provided that such exchange is compatible with or reasonably required for the purpose of preventing, detecting or suppressing insurance fraud.
\n
(2)Without prejudice to Regulation (EU) 2016/679 of the INSURANCE BUSINESS European Parliament and of the Council of 27 April 2016 on the protection of natural persons with regard to the processing of personal data and on the free movement of such data, and repealing Directive 95/46/EC (General Data Protection Regulation), as amended from time to time, the collection, use, storage and transmission of information for the purposes of the exchanging of personal data referred to in sub-article (1) is deemed to be a necessary measure for the prevention, detection or suppression of insurance fraud.
\n
Art. 61
\n
61.A notice or other document to be given or served under this Act or any regulations or Insurance Rules made thereunder shall be deemed to have been duly given or served on a person if (a) it has been delivered to him; or Service of notices, etc.
\n
Amended by:
\n
XII. 2006.112;
\n
XX. 2007.137;
\n
XXXIII. 2015.61. (b) it has been left at the address furnished by him to the competent authority, or at his last known address; or (c) it has been sent to him by post or by telefax at any of the aforesaid addresses; or (d) in the case of a commercial partnership registered in Malta, it has been delivered, sent by post or by telefax, or left at the registered office, or the last known registered office, of that commercial partnership; or (e) in the case of any other body of persons, whether corporate or unincorporate, it has been given or served in any of the manners aforesaid to or on an officer, secretary, or a clerk of that body or to any person designated by that body for that purpose as the case may be; or (f) in the case of a third country insurance or reinsurance undertaking or Lloyd’s, it has been given or served to the person designated under article 11(1)(b)(i) or article 48A(3), respectively; and the expression \"officer\", in relation to a body of persons shall include an insurance agent, an insurance manager, or a person, other than an insurance agent or an insurance manager, authorised to act for that body of persons in the same manner and to the same extent as an insurance agent.
\n
Art. 62
\n
62.(1) Regulations may be made under this Act providing for (a) a body corporate, registered, incorporated or constituted in a country outside Malta, which is similar in nature to a company as known under the laws of Malta and which would, if it were such a company, qualify to be authorised under this Act as an undertaking carrying on business of insurance or a company enrolled to act as an insurance manager or insurance broker under the Insurance Distribution Act, to be continued as authorised under this Act or enrolled under the Insurance Distribution Act; and Continuance of undertakings carrying on business of insurance, or companies enrolled as insurance manager or insurance broker.
\n
Amended by:
\n
XVII. 2002.266;
\n
XIII. 2004.119;
\n
XII. 2006.113;
\n
XXXIII. 2015.69. (b) an undertaking carrying on business of insurance authorised under this Act or a company enrolled to act as insurance manager or insurance broker under the Insurance Distribution Act to be continued as a body corporate registered, incorporated or constituted under the laws of a country outside Malta, in either case by complying with the regulations;
\n
INSURANCE BUSINESS and the Companies Act shall, in respect of such bodies, undertakings or companies, have effect accordingly.
\n
(2)Regulations under this article may provide that continuance as aforesaid may only take place if (a) it is within the power of such body, undertaking or company so to continue; (b) the continuance is, in either case, approved in such manner as may be prescribed, and the regulations may further provide that the continuance of an undertaking or company as stated in paragraph (b) of sub-article
\n
(1), as a body corporate under a foreign jurisdiction, shall not take place unless (i) such continuance (or similar process, including conversion) is permitted by the law of such foreign jurisdiction and is in accordance with such provisions thereof as may bring about such continuance (or similar process); and (ii) such continuance (or similar process) will operate the continuation of the corporate existence of the undertaking or company as, or its conversion into, a body corporate which will continue to retain or will succeed to all assets, rights, and liabilities of such undertaking or company.
\n
(3)In this article, reference to the \"company\" shall include reference to a partnership en commandite or to a similar or equivalent body corporate the capital of which is divided into shares.
\n
Valuation regulations.
\n
(4)The provisions of this article and of any regulations made thereunder shall prevail over anything to the contrary contained in the Companies Act, or regulations made thereunder, with respect to continuance of undertakings or companies.
\n
Art. 63
\n
(Deleted by Act XXXIII. 2015.70).
\n
INSURANCE BUSINESS
\n
Art. 64
\n
64.(1) The Minister may, after consultation with the competent authority, make regulations to give effect to the provisions of this Act and to amend or revoke any schedule thereto and may amend or revoke such regulations; and without prejudice to the generality of the foregoing, the Minister may, by such regulations, in particular, make provision in respect of any one or more of the following matters: (a) any matter relating to or connected with the business of insurance or contracts of insurance; (b) the requirements, duties or conditions to be observed by any undertaking authorised under this Act for the sound and prudent management of its activities; (c) provide for and regulate the payment by any person, body or cell created by a cell company, as the case may be, of any fees, duties and such other charges payable to the competent authority in respect of any matter provided for, by or under this Act or any regulations made under this article; (d) any matter relating to or connected with any provision contained in the Schedules; (e) any matter that may or is to be prescribed under any provision of this Act; (f) any matter incidental to or connected with any of the above; (g) the penalties or other punishments to which persons contravening or failing to comply with any provision of any regulation made as aforesaid shall become liable, being penalties not exceeding one hundred and fifty thousand euro (€150,000), in respect of any offence and in respect of a continuing offence of a further penalty and not exceeding two hundred and thirty euro (€230) for each day during which the offence continues.
\n
(2)Except where any regulation made under this Act provides for a lesser penalty, any person acting in contravention of or failing to comply with or otherwise observe any such regulation shall be liable to a penalty of not less than two hundred and thirty euro (€230) and not exceeding one hundred and fifty thousand euro (€150,000), in respect of each offence and in the case of a continuing offence to a further penalty not exceeding two hundred and thirty euro (€230) for each day during which the offence continues.
\n
(3)The Minister may, after consultation with the competent authority, make regulations for the supervision of insurance and reinsurance undertakings in a group (\"group supervision\"). Any such regulations may provide for cases of application, scope and levels of group supervision, provisions relating to the solvency of insurance groups, measures to facilitate group supervision including the appointment of the group supervisor, the verification of equivalence of supervision of a parent undertaking with its head office in a third country, which forms part of a group and for a parent undertaking of one or more insurance or reinsurance undertakings, which is a mixed- Minister’s power to make regulations.
\n
Amended by:
\n
XVII. 2002.267;
\n
XIII. 2004.120;
\n
XII. 2006.114;
\n
XX. 2007.138;
\n
L.N. 426 of 2007;
\n
X. 2011.79;
\n
XX. 2013.98;
\n
XXXIII. 2015.71;
\n
XXVI. 2018.85.
\n
INSURANCE BUSINESS activity insurance holding company.
\n
(4)The Minister may, after consultation with the competent authority, make regulations providing for the establishment of special purpose vehicles within the meaning of the Solvency II Directive, including the conditions under which the activities of such vehicles shall be carried on. Any such regulations may provide for exemptions from any provisions of this Act or of any other law, subject to such modifications, variations and conditions as may be specified therein, and in particular may provide that in so far as any of the provisions of the regulations are inconsistent with the provisions of this Act or of any other law, the provisions of the regulations shall prevail, and the provisions of this Act or of any other law shall, to the extent of the inconsistency, not apply.
\n
(5)The Minister may, after consulting the competent authority, make regulations exempting any person, activity or operation or any class or classes or part classes of business of insurance, from all or any of the provisions of this Act or of any regulations made thereunder, subject to such conditions or requirements including the requirement of other forms of authorisation and notification procedures as may be prescribed.
\n
(6)The Minister may, after consultation with the competent authority, make regulations applicable to captive insurance undertakings and captive reinsurance undertakings, exempting from and modifying any of the provisions of this Act or of any regulations made thereunder.
\n
(7)The Minister may, after consultation with the competent authority, make regulations to better implement the provisions of this Act, including the transposition of any requirement or provision as may arise under a Directive, Regulation or Decision of the European Union or any other similar measure relevant for the purposes of this Act. Any such regulations made to transpose any requirement or provision as may arise under a Directive, Regulation or Decision of the European Union or any other similar measure may provide for exemptions from any provisions of this Act or of any other law, subject to such modifications, variations and conditions as may be specified therein, and in particular may provide that in so far as any of the provisions of the regulations are inconsistent with the provisions of this Act or of any other law, the provisions of the regulations shall prevail, and the provisions of this Act or of any other law shall, to the extent of the inconsistency, not apply.
\n
(8)The Minister may, after consultation with the competent authority, make regulations determining the class or classes of long term business and the class or classes or part classes of general business that may be effected and carried out under this Act.
\n
(9)Regulations made under this Act may make such exemptions, conditions or modifications as may be specified therein in respect of different cases, circumstances or purposes and may give the competent authority such power of adaptation of the regulations as may be specified therein.
\n
(10)The exercise of any of the powers assigned under this article shall be subject to any obligations or restrictions arising INSURANCE BUSINESS from Malta’s international commitments.
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(11)Regulations made under this Act and any amendment or revocation of such regulations, may be published in the English language only.
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Art. 64A
\n
64A. Without prejudice to any provision of this Act granting the Minister the power to make regulations, the Minister may, subject to the provisions of the Exclusive Economic Zone Act, from time to time, make, amend, substitute or repeal regulations for the purpose of regulating, prescribing or otherwise providing for any matters regulated by or under this Act or by or under any subsidiary legislation made thereunder, in respect of an exclusive economic zone area or an environment protection area as defined in the Exclusive Economic Zone Act or any activities therein including, but not limited, to the applicability or otherwise of this Act and, or of any subsidiary legislation made thereunder.
\n
Power to make regulations with respect to exclusive economic zone area or environment protection area.
\n
Art. 65
\n
(Deleted by Act XXXIII. 2015.72).
\n
Exemption under Duty on Documents and Transfers Act.
\n
Amended by:
\n
XX. 2007.139.
\n
Art. 66
\n
Deleted by Act V.2020.46.
\n
Exclusion of liability.
\n
Amended by:
\n
XII. 2006.115;
\n
XXXIII. 2015.73;
\n
XXVI.2018.86.
\n
Art. 67
\n
67.(1) Any person who contravenes or fails to comply with any of the provisions of this Act shall be guilty of an offence or infringement as prescribed by regulations issued in terms of this article.
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(2)Any person (a) who, for the purpose of obtaining the issue of an authorisation under this Act or pursuant to any of the provisions of this Act or any regulations, Insurance Rules or Conduct of Business Rules made thereunder, furnishes information or makes a statement or a declaration which he knows to be inaccurate, false or misleading in any material particular, or recklessly furnishes information or makes a statement or a declaration which is inaccurate, false or misleading in any material particular; or (b) who is knowingly a party to, or procures or aids and abets, any contravention of any provision of this Act any regulations, Insurance Rules or Conduct of Business Rules made thereunder, or (c) who intentionally obstructs a person exercising rights conferred by this Act any regulations, Insurance Rules or Conduct of Business Rules made thereunder, or (d) who is knowingly a party to the carrying on of the business of insurance with a fraudulent intent or for a Offences and penalties.
\n
Amended by:
\n
XII. 2006.116;
\n
XX. 2007.140;
\n
L.N. 426 of 2007;
\n
X. 2011.80;
\n
XXXIII.2015.74,77 XXVI.2018.87;
\n
V.2020.67.
\n
INSURANCE BUSINESS fraudulent purpose; or (e) who being a director, a controller, an officer or an employee of an undertaking (i) fails to take all reasonable steps to secure compliance by the undertaking with any of the provisions of this Act or of any regulations, of any regulations, Insurance Rules or Conduct of Business Rules made thereunder, or any authorisation or permit issued thereunder; or (ii) fails to take reasonable steps to ensure the correctness of the statements made or other information given under any of the provisions aforesaid; or (iii) removes, destroys, conceals or fraudulently alters any book, document or other paper with intent to avoid detection of the commission of an offence under any of the provisions aforesaid, shall be guilty of an offence.
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(3)For the purposes of sub-article (2)(f), the expression \"officer\", in relation to an undertaking, shall include an insurance agent, an insurance manager, or a person, other than an insurance a g e n t o r a n i n s u r a n c e m a n a g e r, a u t h o r i s e d t o a c t f o r t h e undertaking in the same manner and to the same extent as an insurance agent.
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(4)The Minister shall make regulations under this article prescribing penalties for offences against this Act, and such regulations may (a) prescribe penalties which are prosecution in the courts of Malta; enforceable by (b) prescribe different penalties for contraventions of different provisions of this Act; (c) prescribe penalties calculated in accordance with the duration of the commission of the offence, unless such penalties are otherwise imposed under article 64.
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(5)The penalties prescribed by the regulations made under sub-article (4) (a) in the case of imprisonment, shall not provide for a sentence of imprisonment greater than four years; (b) in the case of a fine imposed after a prosecution in the courts of Malta, shall not provide for a fine (multa) of less than two hundred and thirty euro (€230) or greater than four hundred and sixty-six thousand euro (€466,000); or (c) may provide for both such fine and imprisonment.
\n
(6)The Minister may by the regulations made under this article provide for administrative penalties in respect of infringements, as may be prescribed, which may be imposed and recovered by the INSURANCE BUSINESS competent authority without recourse to a court hearing; administrative penalties shall be due to the competent authority as a civil debt:
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Provided that an administrative penalty may not be greater than a financial penalty of one hundred and fifty thousand euro (€150,000) in respect of each infringement or failure to comply, as the case may be, and, where such infringement or failure to comply continues, a further penalty not exceeding one hundred and sixteen euro (€116) for each day during which the infringement or failure to comply continues:
\n
Art. 68
\n
68.(1) No proceedings for an offence under this Act and any regulations made thereunder other than an infringement to which article 67(6) applies shall be commenced without the sanction of the Attorney General.
\n
Proceedings for an offence under this Act.
\n
Amended by:
\n
XII. 2006.117.
\n
(2)The provisions of this Act and any regulations made thereunder shall not affect any criminal proceedings that may be competent under any other law.
\n
Art. 69
\n
69.(1) Subject to sub-article (4), every licence issued or other action whatever taken or commenced under the Insurance Business Act* (in this article referred to as \"the Act\") shall continue in force and to be valid as if such licence were issued or other action were taken or commenced under this Act.
\n
(2)Every company licensed under the Act to carry on business of insurance either as principal or as agent shall, not later than the ap pointed dat e, conform with the prov isi ons of t his Act or otherwise cease to carry on the business it was licensed to carry on, and shall until the appointed date or until it conforms with the provisions of this Act, whichever is the earlier, continue to be governed by the provisions of the Act. For the purpose of this article \"appointed date\" means a day being six months after the date of the coming into force of this Act.
\n
(3)Where a company ceases to carry on business of insurance either as principal or as agent on grounds that such company did not, on the appointed date, conform with the provisions of this Act, that company shall be deemed to have given notice to the competent authority under article 39 on the appointed date to cease to carry on the business it was licensed to carry on, on the appointed date, and to have been issued with a permit by the competent authority under that article on the appointed date to cease to carry on such business on the appointed date and to service that business as from that date. The competent authority may impose such conditions with regard to the servicing of that business as it may deem proper. *Repealed by this Act.
\n
Savings.
\n
Amended by:
\n
XII. 2006.118;
\n
XIX. 2010.50;
\n
X. 2011.81;
\n
XXXIII. 2015.77.
\n
INSURANCE BUSINESS
\n
(4)Every licence issued or renewed or other action whatever taken or commenced under the Act in so far as it applies to insurance brokers and insurance salesmen, shall continue in force and to be valid as if such licence were a certificate of enrolment issued or as if such other action were action taken or commenced under the Insurance Distribution Act.
\n
(5)For the purposes of this article \"licence\" includes an authority, permit, approval and appointment.
\n
(6)Without prejudice to the provisions of article 12 of the Interpretation Act, all regulations, orders and other instruments which were kept in force by the Act and all regulations, orders and other instruments made under the Act, and any agreement and arrangement which were made in virtue of the Act, any regulation, order or other instrument shall, if and as in force immediately before the commencement of this article, be deemed to have been made under or in virtue of this Act and shall continue in force and m ay be am ended, altered , r epeal ed or otherwise dealt w ith accordingly.
\n
(7)All references in any enactment and in any instrument or other document to the Act, or any provision thereof, shall, in so far as applicable, be read and construed as a reference to this Act or to the corresponding provision thereof.
\n
(8)Any reference in any licence, notice, decision or other act made or taken by the competent authority, to an insurance directive issued by the competent authority, and any reference in any law or regulation to an insurance directive shall be deemed to be a reference to Insurance Rules.
\n
(9)The assets and the liabilities of the Security Fund established by the Act shall upon the coming into force of this Act be transferred to the Protection and Compensation Fund established by article 49 without the need of any formality other than this Act.
\n
INSURANCE BUSINESS FIRST SCHEDULE Amended by:
\n
XVII. 2002.268;
\n
XIII. 2004.121.
\n
Deleted by XII. 2006.119.
\n
SECOND SCHEDULE (Article 5) Amended by:
\n
XII. 2006.120;
\n
XXXIII. 2015.75.
\n
LONG TERM BUSINESS Classes of Long Term Business Number Class Description I Life and annuity C o n t r a c t s o f i n su r a n c e o n h u m a n l i f e o r contracts to pay annuities on human life, but excluding (in each case) contracts within Classes II and III of this Schedule.
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II Marriage and birth Contracts of insurance to provide a sum on marriage or on the birth of a child, being contracts expressed to be in effect for a period of more than one year.
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III Linked long term C o n t r a c t s o f i n su r a n c e o n h u m a n l i f e o r contracts to pay annuities on human life where the benefits are wholly or partly to be determined by reference to the value of, or the income from, property of any description (whether or not specified in the contracts) or by reference to fluctuations in, or in an index of, the value of property of any description (whether or not so specified).
\n
IV Permanent health Contracts of insurance providing specified benefits against risks of persons becoming incapacitated in consequence of sustaining injury as a result of an accident or of an accident of a specified class or of sickness or infirmity, being contracts that (a) are expressed to be in effect for a period of not less than five years, or until the normal retirement age for the persons concerned, or without limit of time, and INSURANCE BUSINESS (b) either are not expressed to be terminable by the insurer, or are expressed to be so terminable only in special circumstances mentioned in the contract.
\n
V Tontines Contracts of insurance providing for operations whereby associations of subscribers are to be set up with a view to capitalising their contributions jointly and subsequently distributing the assets thus accumulated among the survivors or among the beneficiaries of the deceased.
\n
VI Capital redemption Contracts of insurance providing for capital redemption operations based on actuarial calculation whereby, in return for single or periodic payments agreed in advance, commitments of specified duration and amount are undertaken.
\n
VII Pension fund management (a) Contracts to manage the investments of pension funds, and in particular the assets representing the reserves of bodies that effect payments on death or survival or in the event of discontinuance or curtailment of activity; or (b) Contracts or the kind mentioned in paragraph (a) above that are combined with contracts of insurance covering either conservation of capital or payment of a minimum interest.
\n
VIII Collective insurance Contracts of a kind referred to in Article 2(3)(b)(v) of the Solvency II Directive.
\n
IX Social insurance Contracts of a kind referred to in Article 2(3)(c) of the Solvency II Directive.
\n
INSURANCE BUSINESS THIRD SCHEDULE (Articles 5 and 7) Amended by:
\n
XXXIII. 2015.76.
\n
GENERAL BUSINESS
\n
PART I - CLASSES
\n
Classification of risks according to classes of insurance Number Class Accident (including industrial injury and occupational diseases) (a) fixed pecuniary benefits; (b) benefits in the nature of indemnity; (c) combination of the two; (d) injury to passengers.
\n
Sickness (a) fixed pecuniary benefits; (b) benefits in the nature of indemnity; (c) combination of the two.
\n
Land vehicles (other than railway rolling stock) All damage to or loss of: (a) land motor vehicles; (b) land vehicles other than motor vehicles.
\n
Railway rolling stock All damage to or loss of railway rolling stock.
\n
Aircraft All damage to or loss of aircraft.
\n
Ships (sea, lake and river and canal vessels) All damage to or loss of: (a) river and canal vessels; (b) lake vessels; (c) sea vessels.
\n
Goods in transit (including merchandise, baggage, and all other goods) All damage to or loss of goods in transit, or baggage, irrespective of the form of transport.
\n
Fire and natural forces All damage to or loss of property (other than property included in classes 3, 4, 5, 6 and 7) due to:
\n
INSURANCE BUSINESS (a) fire; (b) explosion (c) storm; (d) natural forces other than storm; (e) nuclear energy; (f) land subsidence.
\n
Other damage to property All damage to or loss of property (other than property included in classes 3, 4, 5, 6 and 7) due to hail or frost, and any event such as theft, other than those falling within class 8.
\n
Motor vehicle liability All liability arising out of the use of motor vehicles operating on the land (including carrier’s liability).
\n
Aircraft liability All liability arising out of the use of aircraft (including carrier’s liability).
\n
Liability for ships (sea, lake and river and canal vessels) All liability arising out of the use of ships, vessels or boats on the sea, lakes, rivers or canals (including carrier’s liability).
\n
General liability All liability other than those falling within classes 10, 11 and 12.
\n
Credit (a) insolvency (general); (b) export credit; (c) instalment credit; (d) mortgages; (e) agricultural credit.
\n
Suretyship (a) suretyship (direct); (b) suretyship (indirect).
\n
INSURANCE BUSINESS Miscellaneous financial loss (a) employment risks; (b) insufficiency of income (general); (c) bad weather; (d) loss of benefits; (e) continuing general expenses; (f) unforeseen trading expenses; (g) loss of market value; (h) loss of rent or revenue; (i) indirect trading losses other than those specified above; (j) other financial loss (non-trading); (k) other financial loss (not specified in (j) above).
\n
Legal expenses Legal expenses (including costs of litigation).
\n
Assistance (a) assistance for persons who get into difficulties while travelling, while away from home or while away from their habitual residence; (b) assistance in other circumstances.
\n
PART II - GROUPS OF CLASSES
\n
The following names shall be given to authorisations which simultaneously cover the following classes:
\n
Number Description Classes of Business Accident and Health Classes 1 and 2 Motor Classes 1 (d), 3, 7 and 10 Marine and Transport Classes 1 (d), 4, 6, 7 and 12 Aviation Classes 1 (d), 5, 7 and 11 Fire and other Damage to Property Classes 8 and 9 Liability Classes 10, 11, 12 and 13