Malta Undertakings for Collective Investment Schemes License_Guideline
Malta Undertakings for Collective Investment Schemes License
Investment Services in Malta are regulated by the Investment Services Act (“ISA”) (Cap. 370 of the Laws of Malta) as amended by Act XVII of 2002.
As per the Act, a collective investment scheme means any scheme or arrangement which has as its object or as one of its objects the collective investment of capital acquired by means of an offer of units for subscription, sale or exchange and which has the following characteristics;
- The scheme or arrangement operates according to the principle of risk spreading; and either
- The contributions of the participants and the profits or income out of which payments are to be made to them are pooled; or
- At the request of the holders, units are or are to be repurchased or redeemed out of the assets of the scheme or arrangement, continuously or in blocks at short intervals;
- Units are, or have been, or will be issued continuously or in blocks at short intervals:
The entity making the application is a Maltase company under the Companies Act (Cap 386).
|Director’s Requirements||The licensee will need at least 2 (two) natural person Fit and Proper Directors of any jurisdiction.|
|Shareholder requirements||The structuring depends upon the promoters’ specific objectives and preferences. Typical set-ups involve the creation of “Voting Shares” issued to the fund’s promoters, providing them with the effective control over the structuring and general operation of the fund, whilst “non-Voting Shares” are issued to investors in the fund. Any changes to the rights attaching to the Voting Shares, redemption of such shares, and/or issue of additional Voting Shares will require the prior approval of the MFSA in each case.|
|Fund Manager||The management of the AIF can be carried out internally by the AIF (self-managed AIFM) or by appointing an AIFM management company|
|Custodian||An AIFM is required to appoint a single local independent custodian for each AIF under management|
The Licensee must appoint a Compliance Officer who will be responsible for ensuring the license holder’s adherence to the license conditions. Ultimate responsibility for compliance rests with the Board of Directors or the General Partners of the fund. The compliance function should operate independently of all operational and business line functions and senior or supervisory management.
The Compliance Officer may act simultaneously as MLRO.
|Local Office||The applicant must have premises acceptable to the MFSA. The premises should be able to facilitate confidential interaction between the applicant and its clients, and provide for safe and confidential storage of documents.|
|Auditor||The Licensee shall establish an internal audit / audit committee in order to undertake the internal audit function of the company and which shall be independent for the management of the company or outsource.|
|Insurance||The applicant must have indemnity insurance coverage or a fidelity bond acceptable to the MFSA.|
|Minimum Capital Requirements||
The Applicant must have the prescribed minimum paid-up capital and is able to meet the prescribed minimum net liquid capital requirement in cash or readily marketable securities.
The prescribed minimum paid-up capital is € 300,000 (Approximately USD 330,000)
- An Undertakings for Collective Investment Schemes License is issued for a period of 5 years. On expiration of such term, the Malta Financial Services Authority may renew such licence for further 5 year periods, subject to continued compliance by the Licensee and upon payment of the renewal fee.
- Filing of Audited Accounts: The financial statements must be approved within 10 months from the accounting year end and must be filed with the Registrar of Companies within 10 months plus 42 days from the accounting year end. However if the 1st accounting period is longer than 12 months, then the approval and submission date need to be decreased by the number of days that the accounting period is longer than 12 months .If these deadlines are not adhered to, penalties of €25 plus €0.50c per day will apply accordingly
- The Licensee must maintain appropriate policies of insurance for the purpose of indemnifying such licensee against any liability that may be incurred as a result of any act or omission by the licensee or any of its officers or employees in the conduct of the licensee’s securities business.
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