'Radical changes' at MFSA will make authority more efficient and transparent - Schembri

The Malta Financial Services Authority (MFSA) is set to be revolutionized in order for it to function in a more transparent and efficient manner, Parliamentary Secretary for Financial Services Silvio Schembri said on Friday.

The authority will start making use of new technologies like ‘regtech’ and ‘fintech’ as part of an investment plan by the government which was announced in the next year’s budget, Schembri said.  

Regtech involves the use of automated administrative functions including the drafting of emails, staff recruitment, predicting upcoming jobs and pre-qualifying candidates. Fintech on the other hand makes use of software and other technologies to support or enable banking and financial services that do not require the functions of a traditional banks.

Addressing a press conference on the measures announced in next year’s budget, Schembri said that the companies register, which currently operates under the MFSA, will now be a separate entity, the Registry of Companies Authority. This, he said, will allow the MFSA to focus on its tasks as a regulator.

Schembri added that the structure of the MFSA would also be undergoing a radical change in the name of transparency. He said the MFSA’s three administrative committees will be replaced by a single executive committee.

"Laws will be amended," he said, "so that a committee is made of members of government and members of the opposition. The MFSA will start enjoying complete autonomy."

A consultative body will also be set up to ensure the government implements its 10-year vision that includes Blockchain, Artificial Intelligence and other technologies.

"Malta is the first country in the world to provide a holistic framework for Blockchain," he said. "This means that the law and other sectors must cater for these radical changes."

He said that a national strategy on artificial intelligence would also be launched in the coming months, to explore what opportunities the technology holds and to attract new investment. He said a pilot project using the Internet of Things will be launched in Luqa in the coming days.  

"Many new changes and updates with regards to these technologies will be announced in the near future," he said.

The laws, he said, would also allow for criminal proceedings to be filed against companies that might falsely claim that a Blockchain license has been issued from Malta, the only country at this stage that can issue such licenses. "A fine that might go up to €10 million will protect foreign countries from breaching licensing regulations."

Schembri said that while he was pleased that countries like France and Germany were following Malta's footsteps with regards to these innovations, many countries and foreign jurisdictions were unaware of Malta's place in the world in terms of these.