6 - 12 December 2000

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The Exchange introduces fee changes

The Malta Stock Exchange yesterday announced widespread changes to the fees charged for various market activities and the means by which they are collected.

Commencing 1 January, the brokerage commission charged and paid to stockbrokers, will no longer be fixed by the Malta Stock Exchange, but will become subject to negotiation between investors and stockbrokers.

Due to this policy shift, it will no longer be possible for the Exchange to calculate stockbroking firms’ gross income. Fees annually payable by these firms in arrears will now be calculated in relation to gross income, at 0.03 per cent of turnover by monthly invoice.

Under the new brokerage commission structure, the brokerage on the first Lm1,000 of contract value from Malta Government Securities, Loan Stocks and Bonds, will be of 0.3 per cent, with a minimum of Lm2. The brokerage on the first Lm1,000 on other stocks and shares is of 1.5 per cent, with a minimum of Lm3. Bonds denominated in US$, meanwhile, will be subject to brokerage of 0.3 per cent on the first US$2,000.

Additional changes which will be brought about by the revisions will raise the Accredited Representative (AR) admission fee to Lm250 from their previous level of Lm200. The additional Lm50 will be used to cover at least eight hours of compulsory training provided by the Exchange. Should the AR require additional training, a further charge of Lm10 will be levied.

The revision has also set out to correct a current anomaly, by which some ARs are charged an annual fee of Lm300, some of Lm150 and others of Lm25. The Council has streamlined the fees and a new annual fee of Lm100 will be applicable to one and all.

Financial Intermediaries (FIs) will no longer be charged a fee on gross income as brokers will be charged at 0.03 per cent of total turnover, and it will be up to the stockbroker and FI to take this into consideration when agreeing on how the commission is to be shared.

Processing fees regarding Primary Issues in the Central Securities Depository will no longer be subject to negotiation. Instead, should the Exchange be requested to process primary issues, a specific charge of Lm 0.50 per holder will be introduced in addition to initial take-on fees.

Although there will be no change on initial fees above Lm1,000, fees up to Lm1,000 will be reduced by Lm0.25 per holder. Regarding bought and sold movements, the charge will be reduced to Lm1, while charges to third parties have increased to Lm3 and transaction charges will be raised to Lm2.

The Exchange explained that the changes effected will not regard membership of the Exchange, Listing fees, remote access, and annual fees, although these have been incorporated into the annual fee.

The Business Times, Network House, Vjal ir-Rihan San Gwann SGN 07
Tel: (356) 382741-3, 382745-6 | Fax: (356) 385075 | e-mail: editorial@networkpublications.com.mt