Procedure
The procedure to incorporate a structure in Malta is relatively straightforward and quick process. The Registrar would typically process the registration within 2 to 3 working days.
Whereas the most preferred form of company is the Private Limited Liability Company (Ltd), the Companies Act caters for a wide range of entities including:
- Public Limited Liability Company (plc)
- Partnership en nom collectif (general partnership)
- Partnership en commandite (limited partnership)
- Association en participation
- Societas Europaea (European company)
- European Economic Interest Group (EEIG)
A company may be set up by the submission of its Memorandum of Association with the Malta Business Registry, which must include certain key information such as company name, objects, capital, subscribers, directors, and company secretary. In practice, tailored Articles of association, which regulates the internal management of the company, is also submitted together with the Memorandum of Association to the Registrar.
Capital requirements
The minimum authorised share capital of a public company is €46,587.47. In the case of a private company, the minimum authorised share capital is €1,164.69.
Shareholders
Private Limited companies must have at least 2 shareholders. However, it is worth noting that single-member companies may be set up. In such case, the Memorandum and Articles of Association of the Company must:
- determine the principal activity of the company
- limit the number of persons holding debentures of the company to not more than 50
- prohibit any body corporate from being a director, and
- prohibit the company and each of the directors, from being a party to an arrangement whereby the policy of the company is capable of being determined by persons other than the directors, members or debentures holders thereof.
Registration fees
The registration fee will depend on the authorised share capital of the company and on whether the registration is made in paper or electronic format. The fees start at €100 with the maximum set at €2,250 if the authorised share capital exceeds €2,500,000.
Companies are also subject to an annual fee payable to the Malta Business Registry, based on the share capital of the company, ranging from €100 to €1,400.
Re-domiciliation
Re-domiciliation of non-resident companies to Malta are permitted under Maltese law. Shareholders of a non-resident company may re-domicile their company to Malta rather than undertaking a winding up/liquidation procedure before setting up a new structure in Malta. The company would keep its assets, rights, obligations, and liabilities of its country of origin.
Once the company is re-domiciled to Malta it will be considered as resident and domiciled in Malta and hence subject to tax on its worldwide on come at the standard 35% rate. Furthermore, its shareholders may benefit from the tax refund system.
Upon re-domiciliation the company may opt for the step-up clause whereby the company may revalue the assets from historic costs to fair market value at the time of re-domiciliation. Such revaluation will apply for determining gains on a subsequent disposal of assets with the result that any previously accrued profits would be exempt from tax in Malta.
Directorship and Company Secretary
Every public company must have at least two directors whereas every private company must have at least 1 director. It is also a legal requirement for all companies to have a company secretary.
A Maltese company is managed by the directors who have the authority to execute all powers of the company, having broad discretionary powers.
No company may have:
- As company secretary its sole director unless the company is a private exempt company.
- As sole director of the company a body corporate, the sole director of which is company secretary to the company.
All companies are required to hold an annual general meeting. Every company must hold an Annual General Meeting. Every general meeting other than the annual general meeting is called an extraordinary general meeting.
Annual returns, Accounts, and audits
Companies are also required to file a copy of the annual accounts.
Companies returns, and annual accounts can also be filed online.
The format of the accounts to be submitted depends on the size of the company. Small companies may draw up abridged balance sheets and abridged layouts of profit and loss accounts.
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