The principal Maltese legislation regulating companies and commercial partnerships is the Companies Act 1995, which to a large extent, derives its basis from UK legislation. The Maltese Companies Act defines the types of corporate entities or commercial partnerships that may be established and regulates the manner in which their affairs are to be conducted.
The Malta Business Registry houses all commercial partnerships including companies are registered irrespective of what type of activities they carry out.
A limited liability company is the most common form of business entity in Malta. It may have the status of a public or private company.
A private company is a company that must, by its memorandum or articles:
Restrict the right to transfer its shares;
Limit the number of members to fifty; and
Prohibit any invitation to the public to subscribe for any shares or debentures of the company.
A public company is a company that does not qualify as a private company. A public company may offer shares or debentures to the public but it may not issue any form of application for its shares or debentures unless the company is registered and the issue is accompanied by a prospectus.
The memorandum of association of every company must contain the following information:
(a) Whether the company is a public company or a private company;
(b) The name and residence of each of the subscribers thereto;
(c) The name of the company;
(d) The company’s registered office in Malta;
(e) The objects of the company;
(f) The amount of share capital with which the company proposes to be registered (also referred to as the authorised capital), the division thereof into shares of a fixed amount, the number of shares taken up by each of the subscribers and the amount paid up in respect of each share and, where the share capital is divided into different classes of shares, the rights attaching to the shares of each class;
(g) The number of the directors, the name and residence of the first directors and, where any of the directors is a body corporate, the name and registered or principal office of the body corporate; the manner in which the representation of the company is to be exercised, and the name of the first person or persons vested with such representation;
(h) The name and residence of the first company secretary or secretaries;
(i) The period, if any, fixed for the duration of the company; and
(j) In respect of each shareholder, director and company secretary, the number of an official identification document should also be given.
The memorandum of association may be accompanied by the articles of association, which is a document that prescribes the internal regulations of the company. The memorandum and articles must be delivered to the Malta Business Registry who, being satisfied that all the requirements of law have been complied with, shall register them. A company comes into existence from the date of registration indicated in its Certificate of Registration.
The length of time to incorporate a company depends on the type of company being incorporated and on whether all information and documentation are available and in order.
Generally, however, the process takes as little as two to three days from when all information and documentation requested is available and in order.
The formation of a company involves professional and ancillary fees together with the payment of a once-only registration fee to the Malta Business Registry. Registration fees payable to the Malta Business Registry are calculated on the basis of the company’s authorised share capital as follows:
|Authorised Capital||Registration fee|
|Up to €1,500||€245|
|Over €1,500 up to €5,000||€245 + €15 for each €500 or part thereof|
|Over €5,000 up to €10,000||€350 + €20 for each €1,000 or part thereof|
|Over €10,000 up to €50,000||€450 + €20 for each €2,500 or part thereof|
|Over €50,000 up to €100,000||€770 + €20 for each €10,000 or part thereof|
|Over €100,000 up to €250,000||€870 + €10 for each €15,000 or part thereof|
|Over €250,000 up to €500,000||€970 + €10 for each €10,000 or part thereof|
|Over €500,000 up to €1,000,000||€1,220 + €20 for each €20,000 or part thereof|
|Over €1,000,000 up to €2,500,000||€1,720 + €10 for each €50,000 or part thereof|
The name of a private company must end with the words ‘Ltd.’ whereas a public company must have ‘p.l.c.’ at the end. Naturally, a company name must not be identical, nor even similar, to the name of another company already in existence.
Company names may be reserved with the Malta Business Registry for a period of 3 months.
The Memorandum of Association must specify the objects for which the company is set up.
The objects may not be simply stated to be any lawful purpose or trade in general.
Every private company must have one shareholder who may be an individual or corporate entity.
A private exempt company may, on the other hand, opt to have a single shareholder as long as it is not a corporate entity.
There are no nationality requirements as to both the shareholders and directors. However, if the shareholders are non-EU residents, the Malta Business Registry requires a banker’s reference for each shareholder to determine that they are competent and financially sound.
The minimum authorised share capital of a public company is €46,588. In the case of a private company, the minimum authorised share capital is €1,165. The authorised share capital shall be subscribed by at least two persons.
Where the authorised share capital is equal to the minimum stipulated by law, as aforesaid, it must be fully subscribed in the memorandum. Where it exceeds such minimum, at least that minimum shall be subscribed in the memorandum.
In the case of a public company, not less than 25%, and in the case of a private company, not less than 20%, of the nominal value of each share taken up shall be paid up on the signing of the memorandum.
Every public company must have at least two directors whereas every private company must have at least one director.
Every company must have a company secretary. The company secretary must, inter alia, keep the register of shareholders in order; take down the minutes of the meetings of the Board of Directors and the General Meetings of the shareholders; ensure that the Malta Business Registry is notified with documents according to Law, including the Annual Return; notify the shareholders and directors of the date, place and time of meetings etc.
All companies must appoint a company secretary. In a private exempt company only, the sole director may also act as company secretary. The company secretary must be a natural person. If required, we can offer company secretary services.
The Companies Act requires every company to keep proper accounting records in the same currency of its share capital. Companies are required to file a copy of the annual accounts. These must generally be accompanied by a copy of the auditors’ report thereon, and the directors’ report. The annual accounts must be filed within 10 months from the end of the financial year, with the grace of 42 days.
A company with subsidiaries must submit consolidated financial statements for the group of companies. Certain exemptions exist for financial holding companies, small groups, and intermediate parent companies.
Companies are required to appoint independent auditors to hold office from each annual general meeting to the next. They are required to report to the shareholders on every set of financial statements furnished at a company’s annual general meeting. The Companies Act also requires that the report of the auditor should be drawn up in accordance with the International Standards on Auditing.
At least once every year, a company is required to file with the Malta Business Registry an annual return giving the following information:
Address of registered office;
Summary of share capital and debentures;
List of shareholders; and
Particulars of directors.
The annual return must show the position as on each anniversary of the registration of the company and must be forwarded to the Registrar within 42 days from that date.
It is the responsibility of the officers of every company to see that the annual return and the annual accounts are filed on time. A payment between €100 and €1,400 depending on the authorised capital is to be submitted along with the return. The fees may be reduced in the event that the electronic format option is adopted.
Every company is required to file an annual income tax return. Companies whose financial year ends on 31 December must file their return by the following 30 September. Other companies must file their tax return by the end of the ninth month after their accounting date, or by the 31 March of the calendar year following the accounting date, whichever is the later. The tax return due date for individuals and other taxpayers is 30 June.
The directors or the company secretary also have a duty to inform the Registrar about certain changes and events that occur during the lifetime of the company. This information is normally submitted on prescribed forms within 14 days from the happening of the matter, change or event. The most common notifications concern the following:
Changes among directors and company secretary (new appointments, resignations or removal) and in the legal representation of the company;
Transfer and transmission of shares;
Amendments to the memorandum or articles of association;
Change in the registered office of the company;
Issue and allotment of shares; and
Dissolution of the company.
We are authorised to provide Fiduciary services.
Every company registered in Malta must have a registered office in Malta. We can provide registered office facilities to companies registered in Malta.
We can also provide the services of a company secretary.
Our team of corporate services administrators provides enterprise support functions to assist clients and their businesses in the formation of companies and their legal requirements. We can provide cost-effective and efficient Malta company formation and company administration services in Malta, including:
Drafting of Memorandum and Articles of Association;
Preparation and submission of VAT and tax returns and other related forms;
Directorship and Company Secretary services;
Registered office services; and
Any other ancillary services related to incorporation and company maintenance.
We can also provide legal and tax advice in relation to your company formation in Malta, ensuring that the Malta company so registered complies with all local company law and financial services regulations and is in line with your business objectives.