The following is a summary of the relevant features of Malta as an international financial centre.
Malta is situated in the centre of the Mediterranean Sea, about 60 miles south of Italy and 180 miles north of North Africa.
(b) Political factors:
Malta gained independence from the United Kingdom in 1964 and became a Republic within the Common Wealth in 1974. The remaining foreign military forces left in 1979 and Malta incorporated neutrality into its constitution in 1987. Malta became a member of the European Union on 1 May 2004.
Malta’s legislative power is exercised by an independent judiciary. The President of the Republic is appointed by the House of Representatives every five years.
Malta is a member of the Council of Europe and of the Commonwealth of Nations. It entered into an association agreement with the European Union regulations and directives are a major source of legislation.
(c) Legal System:
Malta is basically a civil law country; however, 160 years of British rule have left their mark on Malta’s legal system. In fact, although Malta has a civil code largely based on the Napoleonic Code, other aspects of the Maltese law bear a British stamp. This is particularly true in the areas of public law (constitutional law, administrative law, fiscal law, public international law and criminal procedure) and certain important aspects of commercial law. European Union regulations and directives are a major source of legislation.
(d) Population and language:
The population of the island is approximately 410.000. Maltese and English are the official languages, with English being the business language. Italian is also widely spoken.
from 1 January 2008, Malta’s official currency is the euro (€).
FORMATION OF MALTESE COMPANIES
The law regulating Maltese companies is the Companies Act, which in line with various concepts of European Union company law. A commercial partnership established under the Act may be either:
The first two follow civil law principles, whereas the limited liability company envisaged by the Companies Act is based on the UK Companies Act. European Union Company Law Directives have also been incorporated in this Act. The limited liability company is by far the most commonly used. Please see more information below:
(a) Company Incorporation in Malta
A company is constituted when its memorandum and articles of association are entered into and subscribed by at least two people, unless the company is a single member company, field with the Maltese Registrar of Companies and a Certificate of Registration is issued. Most companies are incorporated within 24 hours from the submission of all necessary documentation, including evidence that the initial paid up share capital has been deposited in a local bank.
(2) The memorandum and articles of association of a company must state:
(b) Capital Structure
Companies must have a minimum authorised and issued share capital of € 1.165, at least 20% of which must be paid up on subscription. There are no dept/ equity restrictions except in relation to banks and insurance companies. Companies whose activities are within Malta and which have foreign shareholders are also subject to these capitalisation requirements.
(c) Shares and Shareholders
Shares in Maltese companies must be registered. Registered shares must be issued partly paid (20% minimum). Authorised fiduciary companies may hold shares on behalf of the beneficial owner.
A private company must:
A Maltese company’s affairs are managed by a board of directors consisting of one or more directors appointed by the shareholders.
Every company is required to hold and annual general meeting in each year, and not more than 15 months should elapse between one annual meeting and the next.
(e) Local Presence
A Maltese company must have its registered office in Malta. Director’s meeting may, however, be held anywhere in the world.
(f) Accounting and Audit requirements
A Maltese company is required to keep proper books of account and the directors must lay a profit and loss account and balance sheet before the company in general meeting at least once every calendar year. The company’s financial statements are to be audited by an auditor duly appointed in general meeting.
Audited financial statements are to be filed with the Registrar of Companies. A copy of these statements is also submitted with a company’s income tax return to the tax authorities.
(g) Double Tax Treaties
Malta has many tax treaties which can be used in tax planning
The minimum number of directors is one. Bearer shares permitted: No
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