ACT AN ACT to provide for the establishment

a framework for the regulation

credit purchasers, as well as credit servicers acting on behalf

such credit purchasers,

a creditor’s rights under a non-performing credit agreement, or

the non-performing credit agreement itself, issued by a credit institution established in the European Union; and to amend the Insurance Business Act and the Investment Services Act. 30th July, 2024 ACT XXXII

2024, as amended by Act XI

2025. 1.

this Act is the Credit Servicers and Credit Purchasers Act. Short title and scope.

this Act is to transpose the relevant provisions

the Directive (EU) 2021/2167

the European Parliament and

the Council

24 November 2021 on credit servicers and credit purchasers and amending Directives 2008/48/EC and 2014/17/EU (NPL Directive), and it shall be interpreted and applied in accordance with the said Directive. 2.

Business Rules" means Rules, other than Credit Servicing Rules, issued by the competent authority in accordance with this Act; "consumer" means a natural person who, in credit agreements regulated by this Act or any regulations made thereunder, or Credit Servicing Rules or Conduct

Business   CREDIT SERVICERS AND CREDIT PURCHASERS Rules issued thereunder, is acting for purposes which are outside his trade, business or profession; "CRD" means Directive 2013/36/EU

the European Parliament and

the Council

26 June 2013 on access to the activity

credit institutions and the prudential supervision

credit institutions, amending Directive 2002/87/EC and repealing Directives 2006/48/EC and 2006/49/EC, as may be amended from time to time, and includes any binding legal instruments, guidelines and other measures that have been or may be issued thereunder; "credit agreement" means an agreement as originally issued, modified or substituted, whereby a credit institution grants a credit in the form

a deferred payment, a loan or other similar financial accommodation; "credit institution" means a credit institution as defined in point

Article 4

the CRR; "credit purchaser" means any natural or legal person, other than a credit institution, that purchases a creditor’s rights under a non-performing credit agreement, or the nonperforming credit agreement itself, in the course

its trade, business or profession, in accordance with applicable European Union law and national law; "credit service provider" means a third party used by a credit servicer to perform any

the credit servicing activities; "credit servicer" means a legal person that, in the course

its business, manages and enforces the rights and obligations related to a creditor’s rights under a non-performing credit agreement, or to the non-performing credit agreement itself, on behalf

a credit purchaser, and which carries out at least one

the following activities: (

1. a)collecting or recovering from the borrower, in accordance with national law, any payments due related to a creditor’s rights under a credit agreement or to the credit agreement itself; (
2. b)renegotiating with the borrower, in accordance with national law, any terms and conditions related to a creditor’s rights under a credit agreement, or

the credit agreement itself, in line with the instructions given by the credit purchaser, where the credit servicer is not a credit intermediary as defined in CREDIT SERVICERS AND CREDIT PURCHASERS Article 3(f)

Directive 2008/48/EC or in Article 4

Directive 2014/17/EU; (

1. c)administering any complaints relating to a creditor’s rights under a credit agreement or to the credit agreement itself; and, or (
2. d)informing the borrower

any changes in interest rates or charges or

any payments due related to a creditor’s rights under a credit agreement or to the credit agreement itself; "credit servicing agreement" means a written contract concluded between a credit purchaser and a credit servicer concerning the services to be provided by the credit servicer on behalf

the credit purchaser; "Credit Servicing Rules" means Rules, other than Conduct

Business Rules, which may be issued by the competent authority in accordance with this Act; "creditor" means a credit institution that has issued a credit or a credit purchaser; "CRR" means Regulation (EU) No. 575/2013

the European Parliament and

the Council

26 June 2013 on prudential requirements for credit institutions and investment firms and amending Regulation (EU) No. 648/2012, as amended from time to time, and includes any binding legal instruments, guidelines and other measures that have been or may be issued thereunder; "designated representative" means the representative

a third-country credit purchaser designated in accordance with article 17; "Directive 98/5/EC" means Directive 98/5/EC

the European Parliament and

the Council

16 February 1998 to facilitate the practice

the profession

lawyer on a permanent basis in a Member State other than that in which the qualification was obtained, as may be amended from time to time, and includes any binding legal instruments, guidelines and other measures that have been, or may be issued thereunder; "Directive 2008/48/EC" means Directive 2008/48/EC

the European Parliament and

the Council

23 April 2008 on credit agreements for consumers and repealing Council Directive 87/102/EEC, as may be amended from time to time, and includes any binding legal instruments, guidelines and other measures that have been, or may be issued thereunder; CREDIT SERVICERS AND CREDIT PURCHASERS "Directive 2009/65/EC" means Directive 2009/65/EC

the European Parliament and

the Council

13 July 2009 on the coordination

laws, regulations and administrative provisions relating to undertakings for collective investment in transferable securities (UCITS), as may be amended from time to time, and includes any binding legal instruments, guidelines and other measures that have been, or may be issued thereunder; "Directive 2011/61/EU" means Directive 2011/61/EU

the European Parliament and

the Council

8 June 2011 on Alternative Investment Fund Managers and amending Directives 2003/41/EC and 2009/65/EC and Regulations (EC) No. 1060/2009 and (EU) No. 1095/2010, as may be amended from time to time, and includes any binding legal instruments, guidelines and other measures that have been, or may be issued thereunder; "Directive 2014/17/EU" means Directive 2014/17/EU

the European Parliament and

the Council

4 February 2014 on credit agreements for consumers relating to residential immovable property and amending Directives 2008/48/EC and 2013/36/EU and Regulation (EU) No. 1093/2010, as may be amended from time to time, and includes any binding legal instruments, guidelines and other measures that have been, or may be issued thereunder; "European regulatory authority" means a body or bodies designated by a Member State other than Malta in accordance with Article 21

the NPL Directive to carry out the functions and duties stipulated in the said Directive; "GDPR" means Regulation (EU) 2016/679

the European Parliament and

the Council

27 April 2016 on the protection

natural persons with regard to the processing

personal data and on the free movement

such data, and repealing Directive 95/46/EC (General Data Protection Regulation), as may be amended from time to time, and includes any binding legal instruments, guidelines and other measures that have been, or may be issued thereunder; "home Member State" means, with respect to a credit servicer, the Member State in which its registered

fice is situated or, if under its national law it has no registered

fice, the Member State in which its head

fice is situated or, with respect to a credit purchaser, the Member State in which the credit purchaser or its representative is domiciled, or its registered

fice is situated, or if under its national law it has no registered

fice, the Member State in which its head

fice is situated; CREDIT SERVICERS AND CREDIT PURCHASERS "host Member State" means the Member State, other than the home Member State, in which a credit servicer has established a branch or where it provides credit servicing activities, and in any event where the borrower is domiciled, or its registered

fice is situated or, if under its national law it has no registered

fice, the Member State in which its head

fice is situated; "licence" means a licence to carry out credit servicing activities issued under this Act; "licence holder" means a person who holds a licence; "management body" means the body or bodies

a legal person, which is appointed in accordance with the applicable law and which is empowered to set the strategy, objectives and overall direction

the legal person, and which oversees and monitors management decision-making, and includes the persons who effectively direct the business

the legal person; "Member State" means a Member State

the European Union and includes an European Economic Area State; "MiFID" means Directive 2014/65/EU

the European Parliament and

the Council

15 May 2014 on markets in financial instruments and amending Directive 2002/92/EC and Directive 2011/61/EU, as may be amended from time to time, and includes any binding legal instruments, guidelines and other measures that have been, or may be issued thereunder; "Minister" means the Minister responsible for the regulation

financial services; "non-performing credit agreement" means a credit agreement that is classified as a non-performing exposure in accordance with Article 47a

the CRR; "NPL Directive" means Directive (EU) 2021/2167

the European Parliament and

the Council

24 November 2021 on credit servicers and credit purchasers and amending Directives 2008/48/EC and 2014/17/EU, as may be amended from time to time, and includes any binding legal instruments, guidelines and other measures that have been, or may be issued thereunder; "Regulation (EU) 2017/2402" means Regulation (EU) 2017/2402

the European Parliament and

the Council

12 December 2017 laying down a general framework for securitisation and creating a specific framework for simple, transparent and standardised securitisation, and amending Directives 2009/65/EC, 2009/138/EC and 2011/61/EU and CREDIT SERVICERS AND CREDIT PURCHASERS Regulations (EC) No. 1060/2009 and (EU) No. 648/2012; "Regulation (EU) 2018/1725" means Regulation (EU) 2018/1725

the European Parliament and

the Council

23 October 2018 on the protection

natural persons with regard to the processing

personal data by the Union institutions, bodies,

fices and agencies and on the free movement

such data, and repealing Regulation (EC) No. 45/2001 and Decision No. 1247/2002/EC, as may be amended from time to time, and includes any binding legal instruments, guidelines and other measures that have been, or may be issued thereunder.

this Act, unless the context otherwise requires, terms used in this Act which are not defined in the said Act shall have the same meaning as assigned to them in the NPL Directive.

conflict between the English and the Maltese texts, the English text shall prevail in this Act and in any regulations made thereunder. Applicability. 3.

this Act and

any regulations made thereunder, or Credit Servicing Rules or Conduct

Business Rules issued thereunder shall apply to the following: (a) credit servicers acting on behalf

a credit purchaser in respect

a creditor’s rights under a nonperforming credit agreement, or

the non-performing credit agreement itself, issued by a credit institution; and (b) credit purchasers

a creditor’s rights under a non-performing credit agreement, or

the non-performing credit agreement itself, issued by a credit institution.

this Act and

any regulations made thereunder, Credit Servicing Rules or Conduct

Business Rules issued thereunder shall be without prejudice to any other law relating to: (a) the transfer

a creditor’s rights under a credit agreement, or

the credit agreement itself; (b) the protection

consumers and borrowers’ rights, including the provisions

Regulations (EC) No. 593/ 2008 and (EU) No. 1215/2012, and Directives 93/13/EEC, 2008/48/EC, 2014/17/EU as transposed in national law; (c) any restrictions regarding the transfer

a creditor’s rights under a non-performing credit agreement, or

the non-performing credit agreement itself that is not past due, or is less than ninety

a creditor’s rights under a credit agreement, or

the credit agreement itself, when the credit purchaser is a securitisation special purpose entity as defined in point

Article 2

Regulation (EU) 2017/2402, provided that law: (i) does not affect the level

consumer protection provided by the NPL Directive as transposed into national law; and (ii) ensures that the competent authority receives the necessary information from credit servicers. 4. The provisions

this Act and

any regulations made thereunder,

the Credit Servicing Rules or Conduct

Business Rules issued thereunder shall not apply to the following: (a) the servicing

a creditor’s rights under a credit agreement, or

the credit agreement itself, carried out by: (

1. i)a credit institution established in the European Union; (
2. ii)an alternative investment fund manager (AIFM) authorised or registered in accordance with Directive 2011/61/EU, or a management company, or an investment company authorised in accordance with Directive 2009/65/EC provided that the investment company has not designated a management company under the latter Directive, on behalf

the fund it manages; or (iii) a non-credit institution subject to supervision by a competent authority

a Member State in accordance with Article 20

Directive 2008/48/EC or Article 35

Directive 2014/17/EU when performing activities in that Member State; (b) the servicing

a creditor’s rights under a credit agreement, or

the credit agreement itself, that was not issued by a credit institution except where the creditor’s rights under the credit agreement, or the credit agreement itself, is replaced by a credit agreement issued by such credit institution; (c) the purchase

a creditor’s rights under a nonperforming credit agreement, or

the non-performing credit agreement itself, by a credit institution established in the European Union; (d) the transfer

a creditor’s rights under a credit agreement, or

the credit agreement itself transferred before 30th December 2023; and Non-applicability. CREDIT SERVICERS AND CREDIT PURCHASERS (e) the servicing

a creditor’s rights under a credit agreement, or

the credit agreement itself, executed by public notaries or marshals or lawyers as defined in point (a)

Article 1

Directive 98/5/EC when conducting credit servicing activities as part

their profession. Competent authority. 5.

the said Act and any regulations made thereunder, with the Credit Servicing Rules or Conduct

Business Rules issued thereunder.

the NPL Directive as transposed in national law.

this article, where Malta is the home Member State, the competent authority shall ensure that credit servicers and, where applicable, credit service providers to whom credit servicing activities have been outsourced in accordance with article 12, comply with the provisions

this Act and

any regulations made thereunder and with the Credit Servicing Rules or Conduct

Business Rules issued thereunder, on an ongoing basis.

this article, where Malta is the home Member State, it shall be responsible for the supervision

the obligations set out in Article 10 and in Articles 17 to 20

the NPL Directive, as transposed in national law, in respect

the credit purchaser or, where applicable, its designated representative. PART I CREDIT SERVICERS Authorisation as a credit servicer. 6.

funds.

funds. 7.

sub-article

the legal status

the applicant and a copy

its certificate

registration, and its memorandum and articles

association; (b) the address

the applicant’s registered

fice; (c) the identity

the members

the applicant’s management or administrative body and the persons who hold qualifying holdings in accordance with point

Article 4

the CRR; (

1. d)evidence that the applicant fulfils the conditions laid down in article 8(
2. b)and (c); (
3. e)evidence that the persons who hold qualifying holdings in accordance with point

Article 4

the CRR fulfil the conditions laid down in article 8(d); (f) evidence

the governance arrangements and internal control mechanisms referred to in article 8(e); (g) evidence

the policy referred to in article 8(f); (h) evidence

the internal procedures referred to in article 8(g); (i) evidence

the procedures referred to in article 8(h); (j) where relevant, evidence

the existence

a separate account in a credit institution as provided for in article 8(j); (

1. k)any outsourcing agreement as referred to in Application for authorisation. CREDIT SERVICERS AND CREDIT PURCHASERS article 13; and (
2. l)where the applicant does not intend to receive and hold funds from borrowers as part

its business model, a declaration to that effect.

receipt

the application referred to in sub-article

such refusal, shall return the submitted documents to the applicant.

receipt

a complete application or, if the application is considered incomplete by the competent authority,

receipt

the required information and, or documentation, notify the applicant whether the authorisation to act as a credit servicer is granted or refused, and provide reasons for refusal.

the granting

the authorisation under this Act shall submit a request in writing for the extension

its licence to the competent authority by complementing and, or updating the information and documentation referred to in this Act, as applicable.

all credit servicers authorised under this Act and all credit servicers authorised in any Member State other than Malta providing services in Malta under Article 13

the NPL Directive. The competent authority shall publish the said list on its

ficial website and shall update it on a regular basis. Refusal

authorisation. 8. The competent authority shall not grant an applicant CREDIT SERVICERS AND CREDIT PURCHASERS authorisation as a credit servicer in accordance with this Act unless it is satisfied that: (a) the applicant is a legal person as referred to in Article 54

the Treaty on the Functioning

the European Union and its registered

fice is in Malta; (b) the members

the applicant’s management or administrative body are

sufficiently good repute, which is demonstrated by proving that: (i) they have a clean police record or any other national equivalent in relation to relevant criminal

fences, in particular those relating to property, financial services and activities, money laundering, usuary, fraud, tax crimes, violation

professional secrecy or physical integrity, and also in relation to any other

fences under laws relating to companies, bankruptcy, insolvency or consumer protection; (ii) the cumulative effects

minor incidents do not impinge on their good repute; (iii) they have always been transparent, open and cooperative in their past business dealings with supervisory and regulatory authorities; (

1. iv)they are not subject to any ongoing insolvency procedure nor have previously been declared bankrupt unless reinstated in accordance with the applicable law; (
2. c)the applicant’s management or administrative body, as a whole, has adequate knowledge and experience to conduct the business in a competent and responsible manner; (
3. d)the persons who hold qualifying holdings in the applicant within the meaning

point

Article 4

the CRR are

sufficiently good repute, which is demonstrated by fulfilling the requirements set out in paragraph (b)

this article; (

1. e)the applicant has in place robust governance arrangements and adequate internal control mechanisms, including risk management and accounting procedures, which ensure respect for borrower rights and compliance with the laws governing a creditor’s rights under a credit agreement, or the credit agreement itself, and with the GDPR; (
2. f)the applicant applies an appropriate policy ensuring compliance with rules for the protection, and the fair CREDIT SERVICERS AND CREDIT PURCHASERS and diligent treatment

borrowers, including by taking into account their financial situation and, where available, the need for such borrowers to be referred to debt advice or social services; (g) the applicant has in place adequate and specific internal procedures that ensure the recording and handling

complaints from borrowers;    (h) the applicant has in place adequate anti-money laundering and counter terrorism financing procedures where the provisions

the Prevention

Money Laundering Act or in any regulations made thereunder, designate credit servicers as subject persons; (i) the applicant is subject, by virtue

applicable national law, to reporting and public disclosure requirements; and (j) the applicant has a separate account in a credit institution into which all funds received from borrowers are to be credited and kept until their channelling to the respective credit purchaser, under the conditions agreed with the credit purchaser: Provided that this paragraph shall not apply where the applicant does not intend to receive and hold funds from borrowers as part

its business model and provides the competent authority with a declaration to that effect in accordance with article 7

authorisation. 9.

the following applies to such a credit servicer: (a) the credit servicer does not make use

the authorisation within twelve

its grant from the competent authority; (

1. b)the credit servicer expressly renounces to the authorisation; (
2. c)the credit servicer has ceased to engage in the activities

a credit servicer for more than twelve

such authorisation set out in article 8; and, or CREDIT SERVICERS AND CREDIT PURCHASERS (f) the credit servicer commits a serious infringement

any

the provisions

this Act or any regulations made thereunder,

Credit Servicing Rules or Conduct

Business Rules issued thereunder, and, or any other laws regulating consumer protection, including any applicable laws

the host Member State or

the Member State where the credit was granted.

the host Member State in cases where the credit servicer provides services under regulations made under this Act, and also the European regulatory authority

the Member State where the credit was granted, when different from the host Member State and the home Member State.

proposed refusal, variation, suspension or withdrawal

an authorisation. (b) to refuse an application for an authorisation, or to withdraw or suspend an authorisation, it shall give the applicant or the credit servicer, as applicable, notice in writing

its intention to do so, setting out the reasons for the decision it proposes to take.

the notice may, within such reasonable period after the notification thereof as may be stated in the notice, make representations in writing to the competent authority indicating reasons why the proposed decision should not be taken, and the competent authority shall consider any representation so made before reaching a final decision.

article 7

the requirements set out in paragraphs (e) to (h)

article 8: Provided that the competent authority shall determine the Supervision

credit servicers. CREDIT SERVICERS AND CREDIT PURCHASERS extent

the evaluation referred to in this sub-article, having regard to the size, nature and complexity

the activities

the credit servicer concerned.

the host Member State, or

the Member State where the credit was granted, when the latter is different from the host and the home Member State,

the results

the evaluation referred to in sub-article

any one

the said European regulatory authorities, or where the competent authority considers it appropriate. The details

any administrative penalty or other administrative measures imposed shall be transmitted by the competent authority to the European regulatory authority

the host Member State and, where appropriate,

the Member State where the credit was granted, when the latter is different from the host and the home Member State.

the host Member State, and

the Member State where the credit was granted, when the latter is different from the host and the home Member State, as is necessary to enable them to carry out their respective functions and duties laid down in the NPL Directive. Ability to hold funds. 12.

borrowers as part

its business model in accordance with this Act, such funds shall, in accordance with the provisions

any applicable laws, be protected in the interest

the credit purchasers against the claims

the other creditors

the credit servicers, in particular in the event

insolvency.

borrowers as part

its business model in accordance with this Act, and a borrower makes a payment to that credit servicer in order to partially or totally reimburse the amounts due related to a creditor’s rights under a non-performing credit agreement, or to the non-performing credit agreement itself, that payment shall be deemed to have been paid to the credit purchaser.

borrowers as part

its business model in accordance with this Act, that credit servicer shall be required to deliver a receipt or a letter

discharge to the borrower on paper or another durable medium, whenever the credit servicer receives funds from the borrower, acknowledging the amounts received.

the credit servicing activities, the credit servicer shall remain fully responsible for complying with all the obligations emanating from this Act, or any regulations made thereunder, or Credit Servicing Rules or Conduct

Business Rules issued thereunder.

any credit servicing activities as referred to in sub-article

the following conditions: (a) the conclusion

a written outsourcing agreement between the credit servicer and the credit service provider under which the credit service provider shall be required to comply with the applicable legal provisions, including the provisions

this Act or any regulations made thereunder, Credit Servicing Rules and Conduct

Business Rules issued thereunder, and the relevant national and European Union law applicable to a creditor’s rights under a credit agreement, or to the credit agreement itself; (b) the outsourcing to a credit service provider

all credit servicing activities at the same time is prohibited; (c) the contractual relationship between the credit servicer and the credit purchaser and the obligations

the credit servicer towards the credit purchaser or towards borrowers is not altered by the outsourcing agreement with the credit service provider; (d) the compliance

a credit servicer with the authorisation requirements set out in article 8 is not affected by the outsourcing

some

its credit servicing activities; (e) the outsourcing to the credit service provider does not prevent the supervision

the credit servicer by the competent authority and, where applicable, the European regulatory authority

the host Member State and the Member State where the credit was granted, when the latter is different from the home Member State and the host Member State, in accordance with Article 5 and Article 14

the NPL Directive, as applicable; (

1. f)the credit servicer has direct access to all relevant information concerning the credit servicing activities outsourced to the credit service provider; (
2. g)after the outsourcing agreement is terminated, the credit servicer has the expertise and resources to be able to provide the outsourced credit servicing activities; and (
3. h)the outsourcing

credit servicing activities shall not be undertaken in such a way as to impair the quality

the Outsourcing by a credit servicer. CREDIT SERVICERS AND CREDIT PURCHASERS credit servicer’s internal control, or the soundness or continuity

its credit servicing activities.

the home Member State and, where applicable,

the host Member State, prior to outsourcing their credit servicing activities in accordance with this article.

relevant instructions provided to the credit service provider, in accordance with the conditions provided for under applicable national law, and

the outsourcing agreement referred to in this article, for a period

at least five

the value

the creditor ’s rights under the non-performing credit agreement, or

the non-performing credit agreement itself, and the likelihood

recovery

the value

that agreement prior to entering into a contract for the transfer

that creditor’s rights under the nonperforming credit agreement, or

the non-performing credit agreement itself, while ensuring the protection

information made available by the credit institution and

the confidentiality

business data.

the host Member State

at least the following: (

1. a)the company registration number; (
2. b)the legal entity identifier

the credit purchaser or, where applicable,

its representative designated in accordance with article 17, or where these do not exist

: (i) the identity

the credit purchaser or

the members

the credit purchaser’s management or administrative body and the persons who hold qualifying CREDIT SERVICERS AND CREDIT PURCHASERS holdings in the credit purchaser within the meaning

Article 4

the CRR; and (ii) the address and, or registered

fice

the credit purchaser or, where applicable, its representative designated in accordance with article 17; (c) the aggregate outstanding balance

the creditor’s rights under the non-performing credit agreements or

the non-performing credit agreements transferred; (d) the number and size

the creditor’s rights under the non-performing credit agreements or

the non-performing credit agreements transferred; and (e) whether the transfer includes the creditor’s rights under the non-performing credit agreements, or the nonperforming credit agreements themselves, concluded with consumers and the types

assets securing the non-performing credit agreements, when applicable.

transfers that might occur during a crisis period.

the home Member State

the credit purchaser.

this article shall be applied in accordance with the Data Protection Act and the GDPR.

the NPL Directive to provide information to credit purchasers in accordance with sub-article

entry into force

the implementing technical standards referred to in Article 16

the NPL Directive, credit institutions shall complete the data template with the information already available to them.

Article 16

the NPL Directive and sub-article

the said Directive to the transfer

a creditor’s rights under a nonperforming credit agreement, or

the non-performing credit agreement itself, to other credit institutions, and shall use the data templates referred to in Article 16

the NPL Directive for the provision

information between credit institutions in cases where there is only a transfer

a creditor’s rights under a non-performing credit agreement, or

the non-performing credit agreement itself. Obligations

credit purchasers. 15.

fice in Malta shall appoint an entity as referred to in article 4(a)(i) or (iii) or a credit servicer, to perform credit servicing activities in respect

a creditor’s rights under a non-performing credit agreement, or

the non-performing credit agreement itself, concluded with consumers.

sub-article

fice or, if under its national law it has no registered

fice, its head

fice in the European Union purchases a creditor’s rights under a non-performing credit agreement, or the non-performing credit agreement itself, concluded with a consumer domiciled in Malta, in addition to a creditor’s rights under any other credit agreement, or any such other credit agreement itself, it shall appoint an entity as referred to in article 4(a)(i) or (iii) or a credit servicer, to perform credit servicing activities in respect

such creditors’ rights, or such credit agreements themselves.

fice, or if under its national law it has no registered

fice, its head

fice in the European Union, its designated representative shall appoint an entity as referred to in article 4(a)(

1. i)or (iii), or a credit servicer, except in cases where the designated representative itself is an entity as referred to in article 4(a)(
2. i)or (iii) or a credit servicer, to perform credit servicing activities in respect

a creditor ’s rights under a non-performing credit agreement, or

the non-performing credit agreement itself, concluded with: (

1. a)natural persons, independent workers; and, or including consumers and (
2. b)micro, small and medium-sized enterprises (SMEs), as defined in Article 2

the Annex to Commission Recommendation 2003/361/EC: Provided that the provisions

this sub-article shall also apply when a credit purchaser as referred to in this sub-article purchases a creditor’s rights under a non-performing credit agreement, or the non-performing credit agreement itself, concluded with a consumer domiciled in Malta, in addition to a creditor’s rights under CREDIT SERVICERS AND CREDIT PURCHASERS any other credit agreement, or any such other credit agreement itself.

a creditor’s rights under a nonperforming credit agreement, or

the non-performing credit agreement itself, other than as provided for in accordance with this Act and any regulations made thereunder, or Credit Servicing Rules and Conduct

Business Rules issued thereunder, or by any applicable provisions

consumer protection law, contract law, civil law or criminal law.

contracts, consumer protection, borrowers’ rights, credit origination, bank secrecy rules and criminal law shall continue to apply to the credit purchaser upon the transfer

the creditor’s rights under the credit agreement, or

the credit agreement itself, to the credit purchaser.

exchange, the level

protection provided under European Union law and national law to consumers and other borrowers, as well as insolvency laws, shall not be affected by the transfer

the creditor’s rights under the credit agreement, or

the credit agreement itself, to the credit purchaser.

this Act and

any regulations made thereunder, Credit Servicing Rules and Conduct

Business Rules issued thereunder shall be without prejudice to the power

the competent authority and any other national authority, agency and, or body at law to require information from credit purchasers regarding a creditor’s rights under a credit agreement, or the credit agreement itself, and its performance.

this article shall comply, on behalf

the credit purchaser, with the obligations imposed on the credit purchaser under sub-articles

this article complies, on behalf

the credit purchaser, with the obligations imposed on the credit purchaser in accordance with national law, including this Act and any regulations made thereunder, Credit Servicing Rules and Conduct

Business Rules issued thereunder, and any law as referred to in sub-article

credit servicers or other entities. CREDIT SERVICERS AND CREDIT PURCHASERS 16.

the identity and address

the said entity or credit servicer, at the latest on the date on which the credit servicing activities start.

that change and shall indicate the identity and address

the new entity that it has appointed to perform credit servicing activities in relation to the transferred creditor’s rights under a non-performing credit agreement or the non-performing credit agreement itself.

the credit purchaser, the competent authority shall transmit without undue delay to the European regulatory authority

the host Member State, to the European regulatory authority

the Member State in which the credit was granted, and to the European regulatory authority

the home Member State

the new credit servicer, the information received in accordance with sub-articles

a third-country credit purchaser. 17.

a creditor’s rights under a nonperforming credit agreement, or

the non-performing credit agreement itself is concluded, a credit purchaser: (

1. a)that is not domiciled in a Member State; or (
2. b)that does not have its registered

fice in a Member State or, if under its national law it has no registered

fice, its head

fice in a Member State, as the case may be, shall designate in writing a representative that is domiciled in a Member State or that has its registered

fice in a Member State, or if under its national law it has no registered

fice, its head

fice in a Member State.

, the credit purchaser on all issues related to the ongoing compliance with this Act and with any regulations made thereunder, and Credit Servicing Rules and Conduct

Business Rules issued thereunder.

Business Rules issued thereunder. 18.

the legal entity identifier (LEI)

the new credit purchaser and, where applicable,

its designated representative or, where such identifier does not exist,

: (a) the identity

the new credit purchaser or, where applicable, its designated representative, or

the members

the new credit purchaser’s or its representative’s management body and the persons who hold qualifying holdings in the new credit purchaser or its representative within the meaning

point

Article 4

the CRR; and (b) the address

the new credit purchaser or, where applicable,

its designated representative.

sub-article

at least the following: (a) the aggregate outstanding balance

the creditor’s rights under the non-performing credit agreements, or

the non-performing credit agreements transferred; (b) the number and size

the creditor’s rights under the non-performing credit agreements or

the non-performing credit agreements transferred; (c) whether the transfer includes a creditor’s rights under a non-performing credit agreement, or a non-performing credit agreement itself, concluded with consumers and the types

assets securing the non-performing credit agreement, when applicable.

transfers that might occur during a crisis period.

the host Member State and the European regulatory authority

the Transfer

a creditor’s rights by a credit purchaser. CREDIT SERVICERS AND CREDIT PURCHASERS home Member State

the new credit purchaser. PART III REGULATORY AND INVESTIGATIVE POWERS Powers

the Minister. 19.

the competent authority, may make regulations to give effect to the provisions

this Act, and without prejudice to the generality

the foregoing may, by such regulations, in particular, do any

the following: (a) provide for and regulate the payment by any person or body, as the case may be,

authorisation or other fees and such other charges payable to the competent authority in respect

any matter provided for, by or under this Act or any regulations made thereunder, or Credit Servicing Rules or Conduct

Business Rules issued thereunder, including the fees and charges in respect

any permission, licence, authorisation, exemption or other benefit, as well as any fees and charges in respect

the competent authority’s regulatory, supervisory or investigative functions under this Act and under any regulations made, Credit Servicing Rules and Conduct

Business Rules issued thereunder, as may be prescribed; (b) exempt any person, service or activity from any one or more

the provisions

this Act, subject to such variations, additions, adaptations and modifications as may be prescribed and subject to such conditions or other requirements, including other forms

authorisation and notification procedures, as may be prescribed; (c) transpose, implement and give effect to the provisions and requirements

the NPL Directive; (d) transpose, implement and give effect to the provisions and requirements

European Union Directives, European Union Regulations and any other legislative measures

the European Union requiring transposition and, or implementation, as they may be amended from time to time, including any implementing measures that have been, or may be issued thereunder and relating to authorised persons and others as may be specified therein. Regulations made under this paragraph, and strictly related to transpositions or implementations as aforesaid, may provide that any provision

this Act or

any other law shall not apply to matters falling under such regulations, and insofar as any

the provisions

the regulations are inconsistent with the provisions

this Act or

any other law, such provisions in any such regulations shall prevail; (e) assign powers and functions to the competent authority for the purposes

this Act, and provide for the CREDIT SERVICERS AND CREDIT PURCHASERS exercise

such powers and the performance

such functions; (f) provide for the establishment and imposition

administrative penalties and other administrative measures that the competent authority may impose on credit servicers, credit purchasers, designated representatives and any other persons as may be specified therein; (g) prescribe that a breach

any regulations made under this Act may amount to a criminal

fence as may be specified, and such regulations may impose punishments in respect

any breach, consisting

a fine (multa) not exceeding one hundred and fifty thousand euro (€150,000) or imprisonment for a term not exceeding one

compliance with any European Union legislation or with any regulations made in accordance with this article to transpose or to give effect to any European Union legislation; (h) prescribe anything which may be prescribed; and (i) provide for any matter incidental to, or connected with any

the above.

adaptation

the regulations as may also be so specified.

this article, the competent authority may issue Credit Servicing Rules and Conduct

Business Rules for the better carrying out and implementation

the provisions

any regulations made in terms

this Act.

such regulations may be published in the English language only.

any

the powers assigned under this article shall be subject to any obligations or rights arising from Malta’s international commitments. 20.

Business Rules which shall be binding on all persons authorised by it or falling under its regulatory or supervisory functions, or any other persons, as may be specified therein.

sub-article

Business Rules, as applicable, Power to issue Credit Servicing Rules and Conduct

Business Rules. CREDIT SERVICERS AND CREDIT PURCHASERS issued by the competent authority may: (a) lay down additional requirements and conditions in relation to persons authorised by it, seeking its approval, or falling under the regulatory or supervisory functions

the competent authority, their activities, the conduct

their business, their relations with customers, the public and other parties, their responsibilities to the competent authority, reporting requirements, financial and other resources, and related requirements, and any other matters as the competent authority may consider appropriate; (

1. b)provide for the statements and notices that shall be made or given for any purposes in regard to which the competent authority exercises supervisory or regulatory functions, and the form and contents thereof; (
2. c)prescribe the information that such persons are to submit to the competent authority; (
3. d)transpose, implement and give effect to the provisions and requirements

the NPL Directive; (e) transpose, implement and give effect to the provisions and requirements

European Union legislation and any other legislative measures

the European Union requiring transposition and, or implementation, as they may be amended from time to time, including any implementing measures that have been, or may be issued thereunder and relating to authorised persons and others as may be specified therein; and, or (f) regulate any matter that is incidental to, or connected with any

the matters mentioned above as the competent authority may consider appropriate in the performance

its functions.

Business Rules may be made subject to such exemptions or conditions as may be specified t h e r e i n , m a y m a k e d i ff e r e n t p ro v i s i o n f o r d i ff e r e n t c a s e s , circumstances or purposes and may give to the competent authority such powers

adaptation

the Credit Servicing Rules and, or Conduct

Business Rules, as may also be so specified. Power to issue directives. 21.

the following: (

1. a)to furnish to the competent authority, at such time and place and in such form as it may specify, such information and, or documentation as it may require, including the power to require existing telephone and data traffic records; (
2. b)to furnish to the competent authority any information and, or documentation as it may require verified in such manner as it may specify; (
3. c)to attend before the competent authority, or before a person appointed by it, at such time and place as it may specify, to reply to questions and provide such information and, or documentation as it may require; (
4. d)to provide the competent authority any assistance which it may require and which that person is reasonably able to provide.

article 15, a credit purchaser, a credit service provider, a designated representative and any third party designated to perform functions in relation to the provision

services by such persons; (

1. b)the natural and, or legal persons that control any person referred to in paragraph (
2. a)or are controlled by such person, both in the past and present, as well as past and present Power to require information. CREDIT SERVICERS AND CREDIT PURCHASERS directors, managers, auditors,

ficers and other employees

such person, and any third party providing a service to such person; and, or (c) any other person who appears to be in possession

any relevant information.

information imposed by contract or by any legislative, regulatory or administrative provision, and shall not be subject to liability

any kind related to the provision

such information and, or documentation.

any document furnished, provided or to which it has access in accordance with this article.

his knowledge, that information and, or documentation may be available, and the competent authority may require any person, whether indicated as aforesaid or otherwise, who appears to the said authority to be in possession

such information and, or documentation to provide it as requested.

this article shall not apply to information and, or documentation which is privileged in accordance with the provisions

article 642

the Criminal Code.

carrying out his functions under his appointment, have all the powers and functions conferred on the competent authority by this article and a requirement imposed by such person shall be deemed to have the same force and effect as a requirement imposed by the competent authority. Power to appoint inspectors. 23.

any persons referred to in article 22

an investigation, investigate the affairs

any person mentioned in sub-article

his investigation, a final report to the competent authority.

this article, the inspectors may include an advocate, a person authorised to carry out the profession

accountant or auditor in accordance with the Accountancy Profession Act, or a person considered by the competent authority as possessing suitable expertise to exercise such function.   

, and incidental to, an investigation carried out in accordance with this article shall be paid by the persons referred to in sub-article

ficer, employee or agent

the competent authority, on producing proof

his authority, if required, shall have the power to enter any premises occupied by a person on whom a notice has been served in terms

article 22 or whose affairs are being investigated in terms

article 23, for the purpose

obtaining therefrom the information or documents required by that notice, or for the purpose

carrying out on-site inspections or investigations, and

exercising any

the powers conferred by the said articles.

ficer, employee or agent

the competent authority has cause to believe that if the notice referred to in article 22 were to be served, it would not be complied with, or that any documents to which it may relate would be removed, tampered with or destroyed, such

ficer, employee or agent shall have the power on producing proof

his authority, if required, to enter any premises referred to in sub-article

obtaining therefrom any information or documents specified in the authority, being information or documents that may have been required in accordance to such notice as referred to in article 22.

any action taken in accordance with the provisions

this article, the competent authority may request the Right

entry. CREDIT SERVICERS AND CREDIT PURCHASERS assistance

the Commissioner

Police, who may for such purpose exercise such powers as are vested in him by law. Powers

the competent authority. 25. Without prejudice to any other power conferred upon it by this Act or any other law, the competent authority shall have the following powers: (

1. a)to grant or refuse an authorisation in accordance with articles 7 and 8; (
2. b)to withdraw or suspend an authorisation in accordance with article 9; (
3. c)to prohibit any

the credit servicing activities; (d) to conduct on-site and

f-site inspections; (

1. e)to impose administrative penalties and other measures in accordance with article 26; (
2. f)to review outsourcing agreements concluded between credit servicers and credit service providers in accordance with article 13; (
3. g)to require credit servicers to remove any members

their management or administrative body when they fail to comply with the requirements set out in article 8(b); (

1. h)to require credit servicers to modify or update their internal governance arrangements and internal control mechanisms in order to effectively ensure respect for borrowers’ rights in accordance with the laws governing the credit agreement; (
2. i)to require credit servicers to modify or update their policies, plans and procedures adopted to ensure the fair and diligent treatment

borrowers, and the recording and handling

complaints from borrowers; (j) to request further information pertaining to the transfer

a creditor’s rights under the non-performing credit agreement, or

the non-performing credit agreement itself; and (k) to require a credit servicer, credit service provider or credit purchaser or its designated representative that does not meet any

the requirements set out in this Act or in any regulations made thereunder, or Credit Servicing Rules or Conduct

Business Rules issued thereunder to take, at an early stage, all necessary actions or steps in order to comply with those requirements. CREDIT SERVICERS AND CREDIT PURCHASERS 26.

any

the provisions

this Act or in any regulations made thereunder, or Credit Servicing Rules or Conduct

Business Rules issued thereunder; (b) a person has contravened or failed to comply with any condition, obligation, requirement or directive made or issued by the competent authority in accordance with any

the provisions

this Act or any regulations made thereunder, or Credit Servicing Rules or Conduct

Business Rules issued thereunder, including failure to co-operate with an investigation or an inspection or any request made by the competent authority in accordance with this Act.

sub-article

article 13 or the credit service provider to whom the credit servicing activities were outsourced commits a serious infringement

the applicable legal provisions, including the provisions

this Act or any regulations made thereunder, or Credit Servicing Rules or Conduct

Business Rules issued thereunder; (

1. b)a credit servicer’s governance arrangements and internal control mechanisms as set out in article 8(
2. e)fail to ensure respect for borrower rights and compliance with personal data protection rules; (
3. c)a credit servicer’s policy is inadequate for the proper treatment

borrowers as set out in article 8(f); (

1. d)a credit servicer’s internal procedures as set out in article 8(
2. g)fail to provide for the recording and handling

complaints from borrowers according to the obligations set out in this Act or in any regulations made thereunder, or Credit Servicing Rules or Conduct

Business Rules issued thereunder; (

1. e)a credit purchaser, or where applicable, its designated representative fails to communicate the information set out in articles 16 and 18; (
2. f)a credit purchaser or, where applicable, its designated representative fails to comply with the requirement Administrative penalties and other measures. Amended by: XI.2025.52. CREDIT SERVICERS AND CREDIT PURCHASERS

article 15; (g) a credit purchaser fails to comply with the requirements

the provisions

article 17; (

1. h)a credit institution fails to communicate the information set out in article 14; (
2. i)a credit servicer allows one or more persons not complying with the requirements set out in article 8(
3. b)to become or remain a member

its management or administrative organ; (

1. j)a credit servicer receives and holds funds from borrowers when it is not authorised to do so in accordance with this Act; and, or (
2. k)a credit servicer fails to comply with the requirements set out in article 12.

said conduct; and, or (c) to impose an administrative penalty which may not exceed one hundred and fifty thousand (€150,000) euro for each infringement or failure to comply, as the case may be.

this article shall be effective, proportionate and dissuasive, and they shall be effectively implemented.

article 16

the Malta Financial Services Authority Act shall apply, mutatis mutandis, with respect to any administrative penalty imposed by the competent authority in terms

this article.

administrative penalties or other administrative measures imposed by the competent authority in accordance with the provisions

this Act or in any regulations made thereunder, or Credit Servicing Rules or Conduct

Business Rules issued thereunder, he competent authority, when determining the type CREDIT SERVICERS AND CREDIT PURCHASERS

administrative penalty or other administrative measure and, where applicable, the amount

the administrative penalty, shall take into account relevant circumstances, including where appropriate: (a) the gravity and the duration

the infringement; (b) the degree

responsibility

the credit servicer or credit purchaser, or where applicable, its designated representative responsible for the infringement; (c) the financial strength

the credit servicer or credit purchaser responsible for the infringement, including by reference to the total turnover

a legal person or the annual income

a natural person; (d) the importance

profits gained or losses avoided because

the infringement by the credit servicer or credit purchaser or, where applicable, its designated representative responsible for the infringement, insofar as those profits or losses can be determined; (e) the losses caused to third parties by the infringement, insofar as those losses can be determined; (f) the level

cooperation by the credit servicer or credit purchaser responsible for the infringement with the competent authority; (

1. g)previous infringements by the credit servicer or credit purchaser or, where applicable, its designated representative responsible for the infringement; (
2. h)any actual or potential systemic consequences

the infringement.

this article, where obligations imposed in terms

this Act or any regulations made thereunder, or Credit Servicing Rules or Conduct

Business Rules issued thereunder apply to a legal person, in the event

an infringement

any provision thereof, administrative penalties and other measures may also be imposed, subject to the conditions laid down in national law, on the members

the management or administrative body

the legal entity concerned, and on other individuals who are responsible for the infringement under national law.

an administrative penalty or any other administrative measure in terms

this article shall be without prejudice to any other consequence emanating from the act or omission

the

fender in terms

civil or criminal law: CREDIT SERVICERS AND CREDIT PURCHASERS Provided that in all cases where the competent authority imposes an administrative penalty or any other administrative measure in respect

anything done or omitted to be done by any person, and such act or omission also constitutes a criminal

fence, no proceedings may be taken or continued against the said person in respect

such criminal

fence. Notice

administrative penalties and remedial measures. 27.

its intention to do so, specifying the reasons for the decision it proposes to take.

the notice may, within such reasonable period after the service thereof as may be stated in the notice, make representations in writing to the competent authority specifying the reasons why the proposed decision should not be taken, and the competent authority shall consider any representation so made before reaching a final decision.

decisions. 28.

this Act or any regulations made thereunder, or Credit Servicing Rules or Conduct

Business Rules issued thereunder, on its website immediately after the person subject to that decision has been informed

that decision.

the breach, the identity

the person subject to the decision and any other information which the competent authority deems relevant.

sub-articles

the competent authority imposing measures that are

an investigatory nature.

the identity

the legal person subject to the decision, or the identity or personal data

a natural person would be disproportionate, or where such publication may jeopardise an ongoing investigation, the competent authority shall: (a) defer the publication

the decision to impose a penalty or a measure until the moment where the reasons for non-publication cease to exist; CREDIT SERVICERS AND CREDIT PURCHASERS (b) publish the decision to impose a penalty or a measure on an anonymous basis in a manner which is in conformity with national law, where such anonymous publication ensures an effective protection

the personal data concerned: Provided that in this case, the publication

the relevant data may be deferred for a reasonable period where it is foreseen that within that period the reasons for anonymous publication shall cease to exist; (

1. c)not publish the decision to impose a penalty or measure in the event that the options laid down in paragraphs (
2. a)and (
3. b)are considered to be insufficient to ensure the proportionality

the publication

such a decision with regard to measures which are deemed to be

a minor nature.

such an appeal. Any decision annulling a decision subject to appeal shall also be published.

the competent authority for a period

at least five

the competent authority for as long as is necessary for the purposes

public interest and transparency. PART IV APPEALS,

FENCES AND CONFIDENTIALITY 29.

this article, the Financial Services Tribunal means the Tribunal established by article 21

the Malta Financial Services Authority Act. Appeals. 

the competent authority in terms

this Act or any regulations made thereunder, or Credit Servicing Rules or Conduct

Business Rules issued, thereunder may appeal against such decision to the Tribunal within such period and under such conditions as are laid down in article 21

the Malta Financial Services Authority Act.                  CREDIT SERVICERS AND CREDIT PURCHASERS

sub-article

an application for authorisation which contains all the information required in accordance with this Act within the time limit provided for in article 7

the Malta Financial Services Authority Act.

the competent authority shall not suspend the operation

that decision: Provided that a decision

the competent authority to withdraw the authorisation

a credit servicer shall not become effective until the expiration

the period within which an appeal is filed under this article and, in the case that an appeal is filed within such period, the decision shall become effective on the date

the decision

the Tribunal dismissing the appeal, or on the date on which the appeal is abandoned, whichever is the earliest.  

fences.

this article, the provisions

article 21

the Malta Financial Services Authority Act shall apply, mutatis mutandis, to appeals that may be brought before the Tribunal in accordance with this article. 30.

the provisions

articles 6

article 22

article 23; or (b) contravenes or fails to comply with any condition, obligation, requirement, directive or order made or given in accordance with any

the provisions

this Act or in any regulations made thereunder, or Credit Servicing Rules or Conduct

Business Rules issued thereunder; or (c) for the purposes

, or in accordance with, any

the provisions

this Act or any regulations made thereunder, or Credit Servicing Rules or Conduct

Business Rules issued thereunder, or any condition, obligation, requirement, directive or order made or given as aforesaid, furnishes information or makes a declaration which he knows to be inaccurate, false or misleading in any material respect, or recklessly furnishes information or makes a declaration which is inaccurate, false or misleading in any material respect; or (d) with intent to avoid detection

the commission

an

fence in accordance with this Act, removes, destroys, conceals or fraudulently alters any book, document or other paper; or CREDIT SERVICERS AND CREDIT PURCHASERS (e) intentionally obstructs a person exercising rights or powers conferred by this Act or any regulations made thereunder, or Credit Servicing Rules or Conduct

Business Rules issued thereunder, shall, on conviction, be liable to the punishment

imprisonment for a term not exceeding one

imprisonment is otherwise imposed in regulations made under the Act.

this Act or in any regulations made thereunder, or Credit Servicing Rules or Conduct

Business Rules issued thereunder, shall be without prejudice to any criminal proceedings that may be competent under any other law. 31.

ficers, employees or agents, whether current or former, or by inspectors, auditors and experts formerly or currently engaged by the competent authority for the purposes

, or in accordance with, any

the provisions

this Act or any regulations made thereunder, or Credit Servicing Rules or Conduct

Business Rules issued thereunder, or in the discharge

any functions under any

the said provisions, or by any other person who works, or has worked for the competent authority, or by any third party to whom the competent authority has delegated any

its functions or powers, shall be treated as confidential and protected by the duty

professional secrecy, and shall not be disclosed to any other person, except in the following cases: (

1. a)where the authority, body or person communicating the information to the competent authority consents thereto; (
2. b)where the disclosure

the information is necessary for any legal proceedings; (c) where the information is provided to such other local or European or overseas regulatory, judicial or enforcement authorities in the pursuance

serious concerns

a regulatory or criminal nature; and, or (d) where the disclosure

the information is permitted or required by law or European Union legislation.

Business Rules issued thereunder that concerns business or operational conditions and other economic or personal affairs. Confidentiality. Amended by: XI.2025.53. Personal data protection.   CREDIT SERVICERS AND CREDIT PURCHASERS 32. The processing

personal data for the purposes

this Act, or in any regulations made thereunder, or Credit Servicing Rules or Conduct

Business Rules issued thereunder shall be carried out in accordance with the Data Protection Act, GDPR and Regulation (EU) 2018/1725. PART V COOPERATION WITH OTHER AUTHORITIES Cooperation with European regulatory authorities. 33.

carrying out the functions and duties or

exercising the powers assigned to the competent authority and the said European regulatory authorities under the NPL Directive, as transposed in national law.

carrying out their functions and duties under the NPL Directive, as transposed in national law.

its functions and duties in accordance with this Act or any regulations made thereunder, or Credit Servicing Rules or Conduct

Business Rules issued thereunder, the competent authority shall only use that information in the course

the said functions and duties. The exchange

information between the competent authority and the other European regulatory authorities as referred to in sub-article

professional secrecy referred to in Article 76

MiFID.