On Nov. 21, MLT FSA issued circular re conduct of business rulebook.
MLT FSA issued circular re CCD II transposition and minor amendments to conduct of business rulebook applicable to insurance undertakings and insurance intermediaries.
Circular addressed insurance undertakings and insurance intermediaries offering insurance policies in connection with consumer credit agreements; the latter being defined in and the former, falling within scope of Dir 2023/2225 (CCD II).
Highlights changes to Conduct of Business Rulebook for Credit Institutions applicable to insurance undertakings and insurance intermediaries (COBR) to reflect CCD II rules.
CCD II main changes include stricter rules on creditworthiness assessments to prevent over-indebtedness, more transparent pre-contractual information for consumers (advertising must now present standard information prominently and include explicit warnings such as borrowing money costs money).
Misleading practices like claims that credit will improve financial well-being of consumers or that creditworthiness checks are irrelevant, are being prohibited.
Importantly, CCD II requires that consumers are informed when pricing is determined via automated processing and must be given right to human intervention, explanation.
Enhanced consumers rights to withdraw from agreements via 14-day period, whereby they can withdraw from a credit agreement without a penalty and provided for stronger supervision of credit intermediaries.
Introduces limits on borrowing/interest rates, annual percentage rates of charge and total costs, requires creditors to inform consumers of reasons behind credit application rejection and to ensure timely notification of credit repayment arrears in databases.
National Implementation
CCD II transposed into Maltese Law by Nov. 20, 2025 but 1-year period is provided for its implementation to provide sufficient time to industry to align to its requirements.
Hence, CCD II will come into force on Nov. 20, 2026.
COBR Changes
Minor changes applicable to insurance undertakings and insurance intermediaries art 14(4)-(5) CCD II will come into force on Nov. 20, 2026.
New Rule R.4.1.48A is introduced re personal data concerning clients’ diagnosis of oncological diseases that must not be used during some timeframes and for some age groups, for purposes of underwriting insurance policy related to a credit agreement.
The mentioned right to be forgotten will only be applicable with respect to consumer credit agreements and strictly aims to transpose article 14(4) of CCD II.
Yet, going forward, MLT FSA is committed to consider extending this right towards all types of credit, which require life insurance cover, in particular, home loans.
New rule R.4.1.48B on 3-day window to compare insurance offers (art 14(5) CCD II).
For clients to have additional time to compare insurance offers re consumer credit agreements before purchasing insurance policy.
Regulated persons will ensure consumers are given at least 3 days to compare insurance offers without such offers being changed, clients will be informed of that.
Clients may conclude insurance policy pre-expiry of 3-day period (if explicit request).
Definition of credit agreement in COBR added as definition of credit agreement did not feature in current COBR version; meaning of credit agreement for purposes of the 2 newly introduced rules described is now aligned with the CCD II definition.
New R.4.1.48C refers to Rules R.4.5.14A and R.4.5.14B and states that credit agreement shall have the same meaning as defined in art 2(2) and art 3(3) of CDD II.
Effectiveness
Insurance undertakings, intermediaries encouraged to update policy processes in line with changes highlighted in time with entry into force of CCD II i.e. by Nov. 20, 2026.
