Malta Financial Institution Security Measures Strengthened Amid International Sanctions
The Malta Financial Services Authority (MFSA) has reaffirmed its commitment to ensuring that financial institutions operating in Malta comply with international sanctions, following a review of the National Interest (Enabling Powers) Act. This move aims to strengthen security measures and prevent any involvement in activities that contravene United Nations Security Council resolutions and European Union regulations.
International Sanctions: Understanding the Context
International sanctions have been imposed on several countries, individuals, and entities for various reasons, including:
- Violations of human rights
- Support for terrorism
- Proliferation of weapons of mass destruction
These measures can take the form of: + Diplomatic restrictions + Economic restrictions (trade embargoes, asset freezes) + Military restrictions (arms embargos)
Malta’s National Interest (Enabling Powers) Act
The MFSA is responsible for ensuring that financial institutions operating in Malta comply with international sanctions under the National Interest (Enabling Powers) Act.
Requirements for Licence Holders
To prevent any involvement in activities contravening international sanctions, licence holders are required to:
- Exercise caution and vigilance when conducting business activities
- Monitor their business relationships
- Verify records on an ongoing basis to identify connections with sanctioned entities
- Report any findings of verifications to the Sanctions Monitoring Board
- Inform the MFSA of any action taken
MFSA Guidance and Resources
The MFSA has provided guidance and resources to assist licence holders and other interested persons in being aware of and complying with international sanctions. This includes:
- Information on international sanctions available through the Sanctions Monitoring Board’s website
- Updates on reporting requirements for credit institutions, including developments regarding Council Regulations (EU) No 267/2012, concerning restrictive measures against Iran, and Council Regulations (EU) 208/2014, 101/2011, and 270/2011, related to Ukraine, Tunisia, and Egypt respectively
- Urging licence holders and the public to take US sanctions into consideration when conducting business activities
Conclusion
The strengthening of security measures by the MFSA aims to prevent any involvement in activities contravening international sanctions and ensure compliance with European Union regulations and United Nations Security Council resolutions. The authority’s efforts will help safeguard the integrity of the financial system and maintain Malta’s reputation as a responsible and compliant financial centre.