The Authority has invested considerable effort in its initiatives to inform, update and alert the industry of the regulatory implications emanating from the CSP Reform. These initiatives were stepped up with the coming into force of Act L of 2020, amending the Company Service Providers Act, 2013, and the publication of the Company Service Providers Rulebook on 16 March 2021.
Persons previously exempt from seeking authorisation under the CSP Act were given a two-month period ending on 16 May 2021 to apply for authorisation.
Now that the deadline for applying for authorisation has elapsed what are the next steps?
Once an applicant has submitted the relative Personal Questionnaire(s) and the fees are paid, the Authority starts processing the application. Applicants have already received a notification of the allocated classification and thresholds based upon the information provided in the application form and were given the opportunity to confirm that they agree with the selected classification within a stipulated time frame.
Those persons who have applied for authorisation under the CSP Act by the 16 May 2021 deadline are now availing themselves of the transitory provision in Article 19(1) of the CSP Act. This means that those who have applied can continue to provide the services of a CSP and will be issued with an authorisation or provisional authorisation by the Authority by 16 November 2021. The Act also empowers the Authority to refuse applications. In such cases, applicants will be notified in writing of the decision taken by the Authority.
What should applicants expect and by when will the MFSA contact them?
The Authority will be in contact with applicants through the messaging system available on the LH Portal and may ask for clarifications and further information or supporting documents as deemed necessary. It is important that when contacted by the Authority applicants respond promptly in view of the time limits within which an application is to be processed. Applicants are requested to use the same messaging system for any correspondence related to their application.
When it comes decisions, applicants should expect to hear back from the MFSA as follows:
|Type of Applicant||Deadline||Decision type|
|Applicants classified as under threshold||16 November 2021||Authorised or declined|
|Applicants classified as Class C or over-threshold CSPs||16 November 2021||Authorised, provisionally authorised or declined|
Those who are provisionally authorised will receive further requests for information from the Authority post-16 November 2021 as their applications will be subject to additional scrutiny due to their business model or other circumstances and associated risks. By 16 November 2022, these provisionally authorised applicants will be advised whether their application is being authorised or declined.
How can one apply for a CSP authorisation now that the deadline has closed?
For those persons who missed the 16 May 2021 deadline, all their CSP services should be stopped immediately. Those who continue operating without authorisation in terms of the CSP Act and who have not applied for authorisation by the 16 May 2021 will be breaching the provisions of the Act.
Those who wish to apply for authorisation will need to submit an application form, together with supporting documents, and Personal Questionnaires under the process for new applicants. The application form is available on the Authority’s website at https://www.mfsa.mt/firms/conduct-supervision/company-service-providers/regulation/
Upon receiving a written request, the Authority can exercise its discretion to process an application in an expedited manner. A detailed explanation justifying failure to submit an application in terms of article 19 of the Act within the statutory deadline would be required for an application to be handled in this manner. Evidence supporting such reasons and circumstances should be provided when making such a request.
Such persons should be fully transparent with their CSP clients informing them of the legal consequences emanating from their failure to submit an application in terms of Article 19 of the CSP Act within the statutory deadline.
The Authority will require a breakdown of the company services provided as well as the number of clients for each type of company service and documentary evidence confirming that CSP clients have been informed of the current regulatory status vis-à-vis the Authority.
Full transparency and co-operation is expected both with the Authority and the CSP’s clients.