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The Investment Firms Regulation and Directive (“IFRD Package”) – 3rd Briefing

On 3 May 2021, the Authority issued a third briefing on the implementation of the “IFRD Package which will replace the current Capital Requirements Regulation and the Capital Requirements Directive IV applicable to investment firms.

This briefing focuses on the new prudential reporting requirements under the IFRD package where the Reporting Framework will become applicable as of September 2021.  Upon implementation, investment firms will be required to submit the new reporting return based on a new standardised set of templates, referred to as ‘Annexes’ instead of Appendix 2A or 2C as required by Part BI of the Investment Services Rules for Investment Service Providers. The new Annexes are to be submitted through the MFSA Licence Holder Portal in XBRL format.

For further information, reference should be made to the MFSA website where there is a section dedicated to the IFRD Package circulars and the previous briefings issued by the MFSA.

The full circular can be found through the below link:

https://www.mfsa.mt/wp-content/uploads/2021/05/The-Investment-Firms-Regulation-and-Directive-3rd-Briefing.pdf

The Sustainable Finance Disclosure Regulation (“SFDR”)

On 12 May 2021, the Authority issued a circular in relation to Article 17(1) of the SFDR that exempts investment firms which provide investment advice, and which employ fewer than three persons from the requirements emanating from Regulation (EU) 2019/2088 on sustainability‐related disclosures in the financial services sector.

In this respect, the MFSA outlined its position that such provisions currently do not apply to the investment firms in line with Article 17(1) of the SFDR. However, the MFSA’s position may be revised in view of future developments in this area and/ or as the MFSA may deem fit.

The full circular can be found through the below link:

https://www.mfsa.mt/publication/sustainable-finance-disclosure-regulation-application-of-article-171-of-the-sustainable-finance-disclosure-regulation/

Feedback Statement on the Stakeholder Consultation on Revisiting the Corporate Governance Framework

On 18 May 2021, the MFSA published its Feedback Statement following the several responses received on the ‘Corporate Governance Framework Consultation Document’ issued by the MFSA on 5 February 2020. The intention of revising the Corporate Governance Framework is to strengthen the existing framework through the enhancement of the standards, practices, and Governance processes already implemented within the firms. The MFSA intends to reach the level of Corporate Governance standards within firms by providing updates on regulatory developments in this area, delivering training sessions, and carrying out focused thematic reviews in this respect.

The full Feedback Statement can be found through the below link:

https://www.mfsa.mt/wp-content/uploads/2021/05/Stakeholder-Consultation-on-Revisiting-the-Corporate-Governance-Framework-for-Entities-Authorised-by-the-MFSA.pdf

 

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