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3 NEWS 5.1.2023 THE Malta Association of Credit Man- agement (MACM) has issued a state- ment reminding the business community that the applicable legal interest rate in the event of late payment in commercial transactions in force from 1 January 2023 is 10.5% As from 13 August 2012 the Directive 2011/7/EU of the European Parliament and of the Council of 16th February 2011 on combating late payment in commer- cial transactions has been transposed in Maltese law (Commercial Code) by means of LN272 of 2012. By this Legal Notice, local Suppliers of goods and services (Creditors) should note that: Suppliers of goods and services (Credi- tors) have the right to charge interest on late payment equivalent to 8% plus the ECB reference rate from the day following the date or the end of term for payment agreed in the contract of sale. When the payment terms are not speci- fied in the contract of sale, the supplier of goods and services (Creditor) is entitled to interest on late payment following thir- ty calendar days from the date of receipt of goods or services, or thirty days from the date of invoice. e period for payment agreed by the parties in the contract of sale may not exceed 60 calendar days. However, the parties may expressly agree for a longer period as long as the extension of time is not grossly unfair to the supplier of goods and services (Creditor). e Supplier of goods and services (Creditor) may proceed with the claim for late payment against the client (debtor) without reminding the client (debtor) that the amount is due. In the case of transactions between un- dertakings and public authorities, the pe- riod for payment shall be thirty calendar days if not expressly agreed in the con- tract and may not exceed sixty calendar days if fixed in the contract. However, in case the client (debtor) is a public authority which carries out eco- nomic activities of an industrial or com- mercial nature and if the public authority provides health care, and the payment pe- riod is not expressly fixed in the contract, the payment period shall not exceed 60 calendar days. In addition to the interest charges on late payment, the Supplier of goods and services (Creditor) is entitled to reasona- ble compensation for the Supplier's own recovery costs at a minimum of €40. When the contract of sale provides for the retention of title between the seller and the buyer, the seller is entitled to re- tain title over the goods until the price has been paid in full by the buyer. 10.5% interest rate for B2B late payments from 1 January FROM PAGE 1 These companies often did not clarify the way that the BRA was implemented and how each risk factor and risk criteria within each factor was considered. Customer Risk Assessments (CRA) were also missing in many cases, or the companies had not provided any policies or proce- dures which explained the meth- odology and risk factors that should be taken into considera- tion when carrying out the CRA. The compliance review of a number of companies identified several instances where the obli- gation of customer due diligence was not adhered to. One company was fined because in one file, it did not obtain and provide any documentation which could verify the identity and resi- dential address of the player. In another file, the document ob- tained by the Company to verify the permanent residential address of the player did not bear an issue date and the document was not as a minimum a utility bill. Another file was also in breach because the document obtained by the com- pany was unclear and illegible. In other cases, the FIAU found that the contents of policy doc- uments including those on An- ti-Money Laundering/Combating the Financing of Terrorism poli- cies and procedures, the custom- er acceptance policy and the BRA diverged from each other. Other penalties Administrative penalties im- posed by the FIAU following an assessment of late or non-sub- missions of the 2021 Risk Evalua- tion Questionnaires amounted to €93,600. Moreover, the FIAU issued a to- tal of €15,520 in fines following the failure of a number of subject persons to complete the Subject Person Profile within the stipulat- ed deadline. In addition, the FIAU issued a total of 36,435 requests for infor- mation from January 2020 to June 2021. These were mostly credit institutions, financial institu- tions, remote gaming companies and investment service providers. Failure to reply to requests for information or the late submis- sion of responses led to 171 'po- tential breaches letters' being is- sued, with the majority of cases being remote gaming operators. Following the evaluation of all cases and corresponding rep- resentations, the Committee de- cided to impose an administrative measure on 119 distinct subject persons. These consisted of pecu- niary fines totalling €304,550 im- posed on 67 subject persons and written reprimands imposed on 52 subject persons. Whenever the findings warrant- ed, and in line with the FIAU's policies and procedures, an amal- gamation of administrative meas- ures including both a reprimand and a pecuniary penalty were im- posed on subject persons. Ferratum Bank P.L.C Administrative Penalty of €653,637 Online Amusement Solution Limited Administrative Penalty of €386,567 and Follow-up Directive SataBank plc The FIAU had initially imposed an administrative penalty of €327, 500. This was revised by the Court of Appeal (Inferior Jurisdiction) to €68, 000 ECCM Bank plc Administrative Penalty of €310,217, a reprimand, and a remediation directive Southern Cross SICAV plc Administrative Penalty of €303,710 Triton Capital Markets Limited (previously FXDD Malta Limited) Administrative Penalty of €226,902 and a Follow-Up Directive Nesh Limited Remote Gaming Operator Administrative Penalty of €198,126 Olimp Limited Administrative Penalty of € 130,460 Novum Bank Limited Administrative Penalty of €89,516 Finance Incorporated Limited Administrative Penalty of €83,051 N Trust Limited Administrative Penalty of €94,868 HSBC Bank Malta plc Administrative Penalty of €82,966, a Follow-Up Directive and a Reprimand BDO Consult Limited Administrative Penalty of €61,763 and a Remediation Directive Top fines issued by FIAU in 2022 By law, the FIAU is obliged to publish details, including the identity, of companies or individuals who are issued an administrative penalty exceeding €50,000 Banks amongst most heavily fined by FIAU in 2022 In August 2022, the FIAU announced an administrative penalty of €653,637 for Ferratum Bank plc

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