MBR issues a Notice to the General Public restricting public access to BO information

The Malta Business Registry (MBR) issued a notice explaining how access to the Register of Beneficial Owners is being limited following a decision by the Court of Justice of the European Union which was delivered on 22 November 2022. The Court of Justice ruled that the provisions in Directive (EU) 2015/849 which granted public access to Registers of Beneficial Owners to legal entities are invalid.

The MBR has reacted to this judgement by limiting access to the Register of Beneficial Owners to competent authorities and subject persons, whereas access by the general public has been suspended.

The Notice can be accessed here.

EIOPA issues a discussion paper on cyber component in insurance stress testing framework

EIOPA issued a discussion paper, the purpose of which is to set the ground for an assessment of insurers' resilience under severe but plausible cyber incident scenarios, focusing mostly on the financial consequences of those scenarios. It elaborates on two main aspects:

  • the insurance undertaking's capability to sustain the financial effect of an adverse cyber event.
  • The cyber underwriting risk, which is the capability of an insurance undertaking to sustain the financial impact from a capital and solvency perspective of the materialisation of an extreme, but plausible, adverse cyber scenario affecting underwriting business.

This Paper can be accessed here.

Council adopts Digital Operational Resilience Act

Given the increasing risks of cyber attacks, the EU is strengthening the IT security of financial entities. On 28 November 2022, the Digital Operational Resilience Act (DORA) was adopted by the Council. This will ensure that the financial sector in Europe is able to stay resilient through a severe operational disruption.

The relevant European Supervisory Authorities and EIOPA will now develop technical standards for financial services institutions in the scope of DORA to abide by. The respective national competent authorities will take the role of compliance oversight and enforce the regulation as necessary.

Read the press release here.

MFSA issues Consultation Document on the Publication of Administrative Measures

The MFSA is proposing to establish principles in relation to the publication of Administrative Measures which will be imposed on Investigated Persons following the formal notification of the MFSA's decision to the Investigated Person. These include:

  • The Medium Used for Publishing an Administrative Measure: the MFSA is proposing to maintain the discretion to publish such Administrative Measures on any other media in which it deems appropriate according to the circumstances present at hand
  • The Manner Used for Publishing the Imposed Administrative Measure: following the decision of the MFSA to impose an Administrative Measure and consequently, the Investigated Person is notified of such decision, a public statement must be issued by the MFSA to the public.
  • The Anonymity Principle: the MFSA is proposing to have the possibility to issue the public statement in relation to an imposed Administrative Measure on an anonymous basis if certain criteria is satisfied.
  • The Duration of the Published Administrative Measure: the MFSA is proposing to assess the matter on a case-by-case basis and determine what is the proper duration of the publication. The Investigated Person will be informed of such when they are notified about the enforcement action taken against them.
  • The Monitoring Programme: a yearly assessment would be carried out to monitor and update all the published Administrative Measures.

Amendments to the Insurance Business Act (Exemptions) (Amendment) Regulations

Amendments to the Insurance Business Act (Exemptions) (Regulations) (the "Amendments") are being carried out to ensure that the MFSA adheres to the EU Notice on the adaptation in line with inflation of the amounts laid down in the Solvency II Directive.

The Insurance Business Act (Exemptions) (Regulations) provides for insurance undertakings whose head office is in Malta, which shall be excluded from scope due to size. The criteria for the exemptions have been amended as follows:

  • The annual gross written premium income of the undertaking does not exceed €5,400,000;
  • the total of the undertaking's technical provisions, gross of the amounts recoverable from contracts of reinsurance and special purpose vehicles, as set out in article 18E of the Insurance Business Act, does not exceed €26,600,000;
  • where the undertaking forms part of a group, the total of the technical provisions of the group defined as gross of the amounts recoverable from contracts of reinsurance and special purpose vehicles does not exceed €26,600,000; and
  • the business of insurance carried on by the undertaking does not include reinsurance operations exceeding €600,000 of its gross written premium or exceeding €2,700,000 of its technical provisions gross of the amounts recoverable from contracts of reinsurance and special purpose vehicles.

These amendments can be accessed here.

EIOPA staff paper on comparing recovery and resolution frameworks in banking and insurance

The EIOPA conducted a comparative analysis of the Insurance Recovery and Resolution Directive ("IRRD") and the Bank Recovery and Resolution Directive ("BRRD") to identify similarities and differences between the two legal texts. The analysis confirmed that the European Commission's IRRD proposal has some common elements with the BRRD while also differing from it significantly. EIOPA considers that the similarities included are warranted since they concern areas where there is no need for sectoral specificities (e.g. cross-border resolution, penalties in case of law infringement, etc...). On the other hand, important differences are foreseen regarding fundamental elements of recovery and resolution, such as resolution tools and preparation, which duly reflect the specificities of the insurance sector.

This paper can be accessed here.

EIOPA staff paper on frequently asked questions about IRRD

The EIOPA published a paper to provide more clarity on recovery and resolution in insurance and thereby support a better understanding of the topic among stakeholders. The paper focuses, in particular, on the proposal for an Insurance Recovery and Resolution Directive ("IRRD") put forward by the European Commission in September 2021.

In the paper, the EIOPA answers stakeholders' most frequently asked questions relating to IRRD. The FAQ covers a wide range of topics such as pre-emptive actions, exemption from planning requirements for specific undertakings, cross-border insurers, EIOPA's role in the process and the question of funding.

This paper can be accessed here.

The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.