On December 5th, 2024, the Malta Financial Services Authority (MFSA), as the competent authority in terms of the Trust and Trustees Act (Chapter 331 of the Laws of Malta), published a draft Rulebook for Trustees and other Fiduciaries (‘Rulebook’) intended to replace the current Code of Conduct and issued a call for existing licence holders and stakeholders to provide their feedback on the Rulebook’s proposed rules, which are aimed at:
- establishing a wide-ranging and structured set of rules governing persons acting as trustees, administrators of private interest foundations, and mandataries authorised and regulated by the MFSA in terms of the Act (collectively ‘Authorised Persons’);
- introducing and carving out specific obligations applicable to private trustees and qualified persons;
- reflecting international developments and expectations arising from international standards in the Rulebook, including but not limited to the Financial Action Task Force Standards;
- setting standards in the Rulebook, including but not limited to the Financial Action Task;
- crystallizing existing MFSA practices in the Rulebook; and
- where possible and relevant, aligning the rules applicable to Authorised Persons with relevant rules applicable to persons authorised to provide company services under the Company Service Providers Act, Chapter 529 of the Laws of Malta.
The Rulebook, which intends to build upon the existing framework, comprises of 5 chapters:
- Chapter 1 establishes high-level principles to clarify the MFSA’s expectations of persons falling within the Rulebook’s scope.
- Chapter 2 focuses on authorisation processes, crystallizing existing requirements and procedures, while incorporating the MFSA’s Authorisation Process Service Charter to enhance transparency.
- Chapter 3 goes on to outline the ongoing obligations of Authorised Persons, including governance, risk management, compliance, data retention, financial resources, and reporting requirements and corresponding deadlines.
- Chapter 4 introduces supplementary rules for specific categories, such as private trustees and company service providers, aiming to ensure transparency in beneficial ownership reporting and a level playing field for regulated and exempted providers.
- Chapter 5 addresses the Authority’s enforcement powers, detailing administrative penalties, sanctions, and the principles guiding their application, with considerations for mitigating and aggravating circumstances. These updates aim to align Malta’s regulatory framework with international standards while providing clarity and enhancing compliance across sectors.
Authorised persons and stakeholders in general desirous of submitting their feedback are to do so via e-mail on tcspsupervision@mfsa.mt by no later than 31 January 2025.
