MFSA – Consultation on Proposed Amendments to the Notified Alternative Investment Funds Regime

On the 7th August 2017, the Malta Financial Services Authority (“MFSA”) issued a consultation document regarding amendments which are being proposed to the Investments Services Rules (Part BIII) (“the Rules”) concerning Notified Alternative Investments Funds (“NAIF/s”).

The proposed amendments include the following:

  • Permitting NAIFs to invest in:
    – immovable property or infrastructure, whether directly or indirectly; and
    – non-financial assets;
  • a new obligation on the Alternative Investment Fund Manager (“AIFM”) managing the NAIF to submit a copy of the updated Terms of Reference and the Risk Management Policy (as applicable), following the listing of the NAIF on the List of Notified AIFs;
  • a new requirement on the AIFM to ensure that the relevant Valuation Policy and Procedures are updated and submitted to the MFSA for approval, together with any new valuation arrangements which the AIFM will be implementing in respect of the NAIF; and
  • allowing the AIFM to delegate the Money Laundering Reporting function to either:
    a) the administrator of the NAIF, provided that such administrator is a Recognised Fund Administrator in terms of the Investment Services Act (Chapter 370, Laws of Malta) or is authorised in an EU Member State, or in a reputable jurisdiction; or
    b) an officer of the NAIF who is resident in Malta, provided that certain requisites are fulfilled; or
    c) the money laundering reporting officer of the AIFM itself.

In addition to the above mentioned provisions, the MFSA is also in the process of reviewing and modifying the Continuation of Companies Regulations (L.N. 344 of 2002), together with the relevant Guidelines published by the MFSA, to allow for a Collective Investment Scheme already licensed in a foreign jurisdiction to be continued in Malta as a NAIF once the relevant procedures are completed.

Interested parties are invited to send their comments in writing to the MFSA by no later than the 1st of September 2017- The MFSA Consultation paper can be found here.

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