| CODE | CML5030 | ||||||||
| TITLE | The Legal Framework of Financial Services and Investor Protection | ||||||||
| UM LEVEL | 05 - Postgraduate Modular Diploma or Degree Course | ||||||||
| MQF LEVEL | 7 | ||||||||
| ECTS CREDITS | 5 | ||||||||
| DEPARTMENT | Commercial Law | ||||||||
| DESCRIPTION | The lectures in this study-unit shall generally be concerned with why and how financial services operators are regulated. They shall examine the legal framework and mechanisms that regulate financial services and promote the protection of consumers and investors in the sector. The role of the relevant regulatory bodies shall be analyzed in this context. This exercise shall include a special focus on the following subjects. - Understanding regulation, sources and techniques of regulation and the concept of regulated activities, with particular reference to financial services; defining the notions of financial services and the investor; consideration of the main principles and aims of investor protection; the concept of regulatory capture; a brief overview of the principal legislation which regulate the financial services sector; and reviewing the relevance of consumer and competition legislation and the impact of the recent law establishment of an Arbiter for Financial Services for the benefit of consumers of financial services who have suffered loss. - A review of the role, status and functions of the public authorities regulating the financial services sector during the past ten years, including an analysis of the functions and objectives the Malta Financial Services Authority and of the role of its various organs; the evolution of the MIBA into the MFSA; the gradual establishment of a single unified financial services in Malta and relative advantages and disadvantages, as well as relevant regulatory models and developments overseas, including a review of the so-called Twin Peaks model of supervision. - Comparing the Maltese legal framework with the position in the United Kingdom and other countries; a broad review of the international dimension of financial services regulation, including the basic framework operating within the European Union, especially the notions of the single passport and home country supervision; the role of relevant international organizations, such as IOSCO; and the legal mechanisms which promote more extensive collaboration and cooperation with foreign regulators, especially memoranda of understanding. - Special attention shall be given to the provisions and mechanisms found in the Malta Financial Services Authority Act of 1988 as amended and the Investment Services Act 1994, two of the typical and principal regulatory legislation, including a review of the role and powers of the competent authority, the licensing requirement and the fit and proper test and other regulatory techniques used in the Act for the protection of investors; investor compensation schemes, their objectives and features; and a review of the functions and role of the Financial Services Tribunal. Learning Outcomes: This study-unit has been designed as a preparatory course which seeks to achieve two broad inter-linked objectives. First it covers the regulatory implications of financial services including the increasingly relevant international dimension of regulation. These are considered core topics which every student of the course needs to be aware of before tackling more technical units. It will for example help students understand why banks require a licence and are supervised on an ongoing basis. Secondly, by introducing students, particularly those lacking a legal background, to the general notions of regulation and to the role of regulatory authorities as well as to phenomena such as under-regulation and over-regulation of areas of economic activity selected by the law for special treatment, the unit seeks to better equip students with the basic skills they will require with respect to other subjects making up the rest of the course. This unit, being of a preparatory nature, must therefore be taken during the first semester of a new course. It helps new students as a stepping-stone to other more focused elective units dealing with such subjects as insurance, banking and investment services and which students would have to eventually address. Reading List: 1. Copies of various articles, academic papers, notes and other relevant material will be distributed to students during lectures. 2. Selected University of Malta Theses - Roderick Zammit Pace, The Regulation of Investment Services: A comparative study, LL.D., 1997. - Vanessa Grech, Review of the Powers and Functions of the Regulatory Authorities in the Financial Services Sector, LL.D., 1997. - Omar Grech, The Law of Investor Protection with particular reference to Maltese Law, LL.D., 1999. - Joe Bugeja, The Protection of the Financial Services Consumer, LL.D., 2003. - Danielle Mallia, Aspects of Financial Services Legislation in the Light of Administrative Law and Human Rights, LL.D. 2003. - Gabriella Zammit, An Analysis of International Aspects of Financial Services and of International Regulatory Collaboration, LL.D., 2005. - Ingrid Spiteri Bailey, The Role of Regulators and Competition Authorities in ensuring Competitive Markets, LL.D. 2006. 3. Selected books - A C Page and R B Ferguson, Investor protection, Weidenfeld and Nicolson, 1992. - Robert Baldwin and Martin Cave, Understanding Regulation, Oxford University Press, 1999. - Peter Cartwright, Consumer Protection in Financial Services, Kluwer, 1999. - Eilis Ferran and Charles A E Goodhart, Regulating Financial Services and Markets in the Twenty-First Century, Hart Publishing, 2001. - George Gillingan, Regulating the Financial Services Sector, Kluwer, 1999. - Kenneth Mwenda, Legal Aspects of Financial Services Regulation and the Concept of a Unified Regulator, The World Bank, 2006. |
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| STUDY-UNIT TYPE | Lecture | ||||||||
| METHOD OF ASSESSMENT |
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| LECTURER/S | David Fabri (Co-ord.) Conrad Portanier |
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The University makes every effort to ensure that the published Courses Plans, Programmes of Study and Study-Unit information are complete and up-to-date at the time of publication. The University reserves the right to make changes in case errors are detected after publication.
The availability of optional units may be subject to timetabling constraints. Units not attracting a sufficient number of registrations may be withdrawn without notice. It should be noted that all the information in the description above applies to study-units available during the academic year 2023/4. It may be subject to change in subsequent years. |
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