Banking Act (Cap. 371), article 29

29. (1) If, whether from any report made under article 20 or article 22 or otherwise, it appears to the competent authority that any of the circumstances indicated in article 9(2) apply, the competent authority, after consulting with the Central Bank, ma y, without prejudice to the provisions of article 9(2) and to any other powers conferred on the competent authority under this Act or any other applicable law – (a) require the credit institution forthwith to take such steps as the competent authority may consider necessary to remedy o r rectify the matter; (b) appoint a competent person to advise the credit institution in the proper conduct of its business; (c) appoint a competent person to take charge of the assets of the credit institution or any portion of them for the purpose of safeguarding the interests of depositors; 66 CAP. 371.] BANKING (d) appoint a competent person to assume control of the business of the credit institution and either to carry on that business or to carry out such other function or functions in respect of such business, or part thereof, including to take the nece ssary action for the credit institution to be dissolved and wound up, as the competent authority may direct; (e) require the credit institution to wind up its business or to wind up its business in Malta; (f) appoint a competent person to act as liquidator for the purpose of winding up the affairs of the credit institution; (g) fix the remuneration to be paid by the credit institution to any person appointed under this sub-article; Cap. 383. (h) appoint a person to act as controller and, or to assume control of a credit institution for the purposes of the Controlled Companies (Procedure for Liquidation) Act; a n d h a v i n g adopted any one or more of the measures aforesaid, the competent authority may further adopt any one or more measures, whether in addition thereto or in substitution therefor. (2) Where a competent person is appointed by the competent authority: (a) under sub-article (1)( b), the credit institution shall act in accordance with the advice given by such person unless and until the competent authority otherwise directs; (b) under sub-article (1)( c), the credit institution shall deliver to such person all the assets of which he is placed in charge, and all the powers, functions and duties of the credit instituti on in respect of those assets whether exercisable by the company in general meeting or by the board of directors or by any other person, including the legal and judicial representation of the credit institution, shall be exercisable by and vest in him to the exclusion of the credit institution; (c) under sub-article (1)( d), the credit institution shall submit its business to the control of such person and shall provide him with such facilities as he may require in order to carry on that business or to carry out the functions assigned to him under that paragraph, and all the powers, functions and duties of the credit institution, whether exercisable by the company in general meeting or by the board of directors or by any other person, including for the purpose of the dissolution and winding up of the credit institution as well as the legal and judicial representation of the credit institution in all matters, shall be exercisable by and vest in him to the exclusion of any other person: BANKING [CAP. 371. 67 Provided that the competent person shall not take any decision for the purpose of the dissolution and winding up of the credit institution unless the competent authority, after consulting with the Central Bank, issues a directive to that effect in terms of article 4B and any such directive may contain such instructions, requirements and conditions as the competent authority may consider necessary, including with regard to the mode of winding up. (3) Where a person is appoint ed under sub-article (1)( c) or ( d) - (a) any function, power or duty exercisable by any other person, including the curator of a bankrupt or any other person appointed by or under any other law, and relating to any assets or business of which the person appointed under either of the paragraphs aforesaid is placed in charge or in control, shall, unless or until the competent authority otherw ise directs or an express provision of law s pecifically provide s otherwise, cease to be so exercisable; (b) the person appointed under either of the paragraphs aforesaid shall, in respect of such property, partnerships, firms or other business as the competent authority may specify and in which the credit institution has an interest, whether directly or indirectly, including any interest arising from advances or loans made or credit facilities given or any liability undertaken, have such powers, functions and duties, including legal and judicial representation, as the competent authority m ay direct, and any such power, function or duty shall be exercisable by and vest in such person to the exclusion of any other person: Provided that: (i) the competent authority shall have power to direct that all or any of the powers, functions or duties aforesaid should be exercisable by any other person, and in any such case, with effect from such date or dates as the competent authority may specify and unless and until the competent authority otherwise directs, the powers, functions and duties to which the direction of the competent authority applies shall be exercisable by and vest in such other person appointed for the purpose to the exclusion of all others; (ii) where the competent au thority is of the opinion that the credit institution has ceased to have any interest as aforesaid, i t shall direct that any powers, functions and duties exercisable under this paragraph shall cease to be so exercisable, but any such direction shall not affect anything 68 CAP. 371.] BANKING done or omitted to be done by virtue or by reason of any of the aforesaid powers, functions or duties; (c) the person appointed under either of the paragraphs aforesaid shall have the power to require any other person to provide him with such facilities as he may deem necessary to carry out any of the powers, functions or duties under this article; Cap. 13. (d) the provision of law relating to bankruptcy and in particular Part III of the Commercial Code shall cease to apply to, and shall cease t o operate in respect of any property, partnership, firm or other business specified by the competent autho rity under paragraph ( b), unless and until, or except to the extent that, the competent authority otherwise directs; and in any such case the person appointed as aforesai d shall, subject to any directions of the competen t authority given in the interest of the creditors, act as if those provisions did not exist and as if any declaration of bankruptcy had not been made. (e) Deleted by Act XI.2025. 34. (3a) Any person appointed by the competent authority under paragraphs (c), (d), (f) or (h) of sub-article (1) shall submit six- monthly reports of his activities and annual accounts of all transactions carried out by him in the performan ce of his funct ions, audited by an independent auditor, to the Minister who shall pl ace such reports and accounts on the Table of the House within fift een (15) days. (4) Where a person is appointed under sub-article (1)( f), such person shall be the liquidator of the company for all purposes of law to the exclusion of any other person. (5) The provisions of this article shall have effect notwithstanding any other provision of any enactment, and notwithstanding any deed, contract, instrument or other documen t whatsoever. (6) The foregoing provisions of this article vesting exclusive powers of representation in a person appointed by the competent authority thereunder shall apply also to any act or proceedings commenced or instituted before s uch representation vested as aforesaid, and in respect of any such act or proceedings any ot her person acting or purporting to act, or in respect of whom actio n is taken, in that capacity shall cease to be a party to, and shall be excluded from, any such act or proceedings. (7) No person shall in any way obstruct a person appointed under sub-article (1) in the pe rformance of any of his function s, powers or duties under this article. (8) Deleted by Act XXVI.2019. 14. (9) Upon receipt of a report as is mentioned in sub-article (1), the competent authority shall inf orm the Central Bank on whethe r it BANKING [CAP. 371. 69 intends to take any action pursuant to such report and of any a ction it intends to take thereon. Cap. 386. (10) Without prejudice to the powers of the competent authority in terms of sub-article (1), the competent authority may also m ake an application to the Civil Court (C ommercial Section) for the dis solution and winding up by the Civil Court (Commercial Section) of a cre dit institution where it appears to the competent authority that a credit institution should be dissolved and wound up by the Civil Court (Commercial Section) for the reason set out in article 214(2)(b)(iii) of the Companies Act , and where the Civil Court (Commercial Section) accedes to the application the relevant provisions of the Companies Act in relation to the dissolution and winding up by the Civil Cou rt (Commercial Section) and any other applicable provisions of any other law shall apply. (11) Any measure adopted in terms of sub-article (1) shall rema in in force notwithstanding that a credit institution ceases to ho ld a licence for whatever reason or suc h licence ceases to have effe ct, unless the competent authority otherwise directs. Ranking of creditors in case of insolvency or winding up of a credit institution. Substituted by: X. 2017.3. Amended by: XLIV .2018.12; LXXI.2021.51.