FinanceMalta, the public-private partnership set up to promote Malta's financial services sector, in collaboration with the Malta Funds Industry Association, held another in the series of its highly topical educational clinics for its members and the financial services community on the subject of the Alternative Investment Fund Managers Directive and its impact on Malta.
The Maltese fund industry is increasingly making the headlines in the financial media, which have highlighted the island’s attractiveness as a domicile. Journalists and financial analysts progressively see Malta as a complementary EU jurisdiction to traditional fund domiciles, where the regulatory environment supports innovative strategies and solutions, hence the timing of this FinanceMalta Education Clinic on the subject.
FinanceMalta’s Education Clinic investigated the practical implications for investors, managers, custodians and other service providers. The main speaker at the clinic was Paul Ellis, Regional head of Product Solutions (Europe), HSBC Securities Services, Ireland who has over 20 years financial services experience, focusing on the provision of asset servicing solutions to a broad universe of global investment funds. Mr Ellis served as a member of the Alternative Investment Committee of the Irish Funds Industry Association and the Alternative Investment Management Association.
Included during the session was a panel discussion that set out to evaluate the impact of the Alternative Investment Fund Managers Directive on Malta, comprising Dr Andre Zerafa, Ganado & Associates, Puneet Gupta, HSBC Bank Malta and Joseph Camilleri from PricewaterhouseCoopers. It was noted by the panelists that around 70 fund managers are currently operating in Malta, while 26 fund administrators such as HSBC, Apex, Custom House, Praxis, TMF and Valletta Fund Services have been recognised by the MFSA. Six global custody providers have a presence in Malta, including HSBC.
During the session it was agreed that Malta has the capacity and expertise to help the fund industry continue to expand with the Big Four accounting firms all established on the island, adding weight to the small and medium-sized accountancy firms and large number of law firms servicing the fund sector. Having developed a versatile industry cluster, Malta is now in an excellent position to attract further service providers, particularly custodians, to increase its share of UCITS business as a consequence of the new Directive.
Interest in Malta is also set to grow as fund managers are currently assessing whether it might be more cost-effective to establish a permanent base in the EU. With its generally lower cost structure and a track record in the management of alternative funds, Malta offers an attractive base for alternative managers in this new environment. The first firms to have relocated to Malta include managers from traditional centres such as the Cayman Islands and the British Virgin Islands.
The session included remarks and interventions by Joseph J. Agius, member of the Board of the Malta Funds Industry Association. According to FinanceMalta head of Business Development Bruno L’ecuyer, “The island has already seen a significant inward migration of funds and service providers. Funds from other jurisdictions can easily be transferred to Malta, where the fund undertakes the licensing process with the MFSA concurrently with the corporate redomiciliation procedure. Maltese legislation allows redomiciliation from all EU, EEA and OECD countries as well as from most offshore centres”. The session was streamed using the latest online conference streaming technology, while the event was also turned into a podcast.