MICA Rulebook

On the 11^th of March 2025, the Malta Financial Services Authority (“MFSA”) published a circular on the issuance of a new local Rulebook further to the Markets in Crypto-Assets Regulation (“MiCA”) as well as related amendments to the Financial Institutions Rulebook. This circular is relevant to all entities falling within the scope of MiCA while the amendments to Chapter 3 of the Financial Institutions Rulebook (FIR/03) apply to e-money institutions issuing e-money tokens (EMTs) under MiCA. These updates are aimed to enhance MiCA implementation in Malta, providing relevant guidance and regulatory reporting documentation.

The MiCA rulebook serves as a comprehensive guide for entities to be compliant with MiCA’s requirements. It is intended to be read in conjunction with the recently published Markets in Crypto-Assets Act [Chapter 647 of the Laws of Malta], the Markets in Crypto-Assets (Fees) Regulations [S.L. 647.01], and the requirements set out in the implementing and regulatory standards issued under MiCA. It encompasses:

• Authorization Process – The necessary procedures for obtaining authorization as a Crypto-Asset Service Provider (“CASP”) or as an issuer of an Asset Referenced Token (“ART”). Additionally, fit and proper assessments shall be undertaken in relation to applicants and persons who shall be occupying a senior position within the licenced entity;
• Regulatory Technical Standards (“RTSs”) and Guidelines – A non-exhaustive list of applicable RTSs and guidelines for CASPs and ART issuers is included for the benefit of ensuring that entities are well-informed of their regulatory obligations;
• Ongoing Requirements – By virtue of the rulebook, the MFSA was able to provide its expectations and continuous obligations for authorized entities under MiCA. This also includes information on provision of the relevant information to the MFSA ahead of passporting crypto-asset services in other EU Member States.

The new Rulebook also specifies that a CASP authorised in Malta must be effectively directed or managed by at least 2 individuals in satisfaction of the ‘dual control’ principle, having sufficient substance in Malt and with at least 1 Executive Director being based in Malta.

For the benefit of compliance, the MFSA has also released regulatory reporting documentation that is relevant to CASPs accompanied by guidance documents in aid of streamlining the reporting process. Such include conditions which would be required at the pre-licensing stage. Upon the issue of the letter of approval in-principle, applicants would be required to comply with the conditions imposed within a period of 6 months.

Upon satisfaction of the pre-licensing conditions, the Authority will proceed with issuing the licence whilst having discretion to impose post-licensing and/or pre-commencement of business requirements.

The Rulebook also outlines notification process for the issue of a whitepaper. This procedure differs based on the crypto-asset being issued to the public. The processes are the following:

• For crypto-assets which are not EMTs or ARTs – notification may be done by any Maltese based entity. The applicable fee shall be payable upon submission of the notification form. The MFSA does not pre-approve these whitepapers or associated marketing materials, placing full compliance responsibility directly on the issuer;
• For EMTs the notification process is similar, and no pre-approval of whitepapers or associated marketing materials is required; hence, full compliance is again the responsibility of the issuer; and
• For ARTs the notification process is included within the application process for authorisation.

Modifications to whitepapers shall be notified to the MFSA through the LH portal.

The key amendments to Chapter 3 of the Financial Institutions Rulebook cover the following:

• Integration of Delegated Acts and Technical Standards – A new section is introduced, detailing in a non-exhaustive manner the delegated acts, technical standards, and guidelines applicable to ensure clarity on the governing regulatory framework; and
• Enhanced Notification Procedures – Notification on outsourcing and safeguarding shall now be submitted through the LH portal 60 days prior to the changes taking effect.

The implementation and issuance of these regulatory tools have several implications on industry stakeholders, notably:

• Enhanced Regulatory Clarity – through the circular, guidance documents and other published documents by the MFSA, an authorized person is able to better understand the regulatory framework;
• Strengthen Consumer Protection – the overall MiCA framework aims to enhance consumer protection measures, ensuring that investors and user of crypto-assets are safeguarded against risks; and
• Market Integrity and Financial Stability – the MiCA framework aims to promote market integrity and mitigate associated financial risk. This leads to mitigating systemic risks associated with the burgeoning crypto-assets sector.

These amendments took effect from the date of their publication, reflecting the MFSA’s commitment to proactivity and implementing EU legislation, and being a communicative authority through clarifying requirements for authorized persons. To this effect, authorized persons are able to streamline their internal processes with a clearer regulatory scope.

The introduction of MiCA and its regulating instruments, such as the MiCA Act and FIR/03, attest to Malta’s proactive approach to regulating the crypto-asset and fintech landscape.

For information or assistance, please contact us at info@gtg.com.mt

Author: Dr Neil Gauci