Collective Investment Schemes (CIS) - Malta Investment Funds

AIFMD – Implementation of the Depositary Lite Provisions

12 Dec 2013

2 min read

Following the finalisation of the consultation process which commenced on the 18th September 2013, the MFSA has revised the Investment Services rules for Investment Services Providers in order to introduce the Depositary Lite regime.

By virtue of this regime, certain Maltese AIFs would not be required to appoint a licenced depositary but could seek approval for the appointment of an entity which carries out depositary functions as part of its professional or business activities.

Whilst it was initially expected that the said entities would include law firms and notaries amongst others, it has now been clarified by the MFSA that, given the extensive duties and role of the depositary, only persons who have the competence to provide any investment service and to hold or control Clients’ Money or Customers’ Assets as applicable for a Category 2 Investment Services Licence, should be allowed to provide the services of depositary lite.

Therefore following the coming into force of the new rules, the following licenced entities will be allowed to provide the services of depositary lite following their adherence to the minimum own funds requirement of €125,000 and to obtaining a Category 4b Licence to provide solely and exclusively the depositary lite activities:

(i) Recognised Fund Administrators; and

(ii) Category 2 Licence Holders [MiFID Investment Firms]

Should you wish to receive any guidance, please send your question/s and observations here for our feedback.