Corporate

Corporate

Setting up a Company in Malta

Opening a company in Malta is fairly uncomplicated and is a process that takes just over a week provided that all information, funds and due diligence documentations is presented immediately without delay.

 Act that regulates Maltese companies is the Companies Act which was enacted in 1995. The law is founded upon the UK Companies Act and facilitates the establishment of various types of commercial partnerships including limited liability companies, as well as partnerships ‘en commandite’ and partnerships ‘en nom collectif’.  The Act moreover allows for cross border mergers and divisions whilst simultaneously enabling foreign companies to re-domicile to Malta and vice versa.

Setting up a company in Malta has numerous advantages courtesy of the taxation system, which provides up to 6/7 refunds to foreign shareholders, full tax exemptions for holding companies and no withholding taxes or stamp duties in case of profit repatriation. Furthermore, when taking into consideration the low company formation and maintenance costs, foreign investors have several other incentives to set up a company in Malta.

Another principal advantage of setting up a business in Malta in that no special permit or licence is mandatory, except for the businesses in the medical, financial, insurance or pharmaceutical sectors. This essentially means that as soon as you have finished your business plan and acquired your citizenship or residence status, one can initiate the process to opening business in Malta.

 

 

Types of companies in Malta

Foreign investors opening up companies in Malta may decide between several types of business structures according to their requirements. The Maltese Commercial Code permits the incorporation of the following entities:

  1. sole proprietorships- persons carrying out business activities in their own name.
  2. general partnerships – for small and medium-sized businesses;
  3. limited partnerships – similar characteristics to general with the advent of limited liability introduced;
  4. private limited liability companies – the most utilised business form in Malta;
  5. public limited liability companies – suitable for large businesses;

Foreign businesses moreover have various other options, among which they have the choice of subsidiaries, branches and liaison offices in Malta.

Requirements for opening a company in Malta

When deciding to commence business in Malta, foreign investors will generally assess the amount of initial investment, better known as share capital that they will have to inject into the company. The Commercial Code provides minimum thresholds in terms of share capital which are as follows:

In the case of a Maltese private company, the minimum figure allowed is 1,165 euros, while for the public company the minimum share capital is approximately 46,600 euros of which only 25% must be deposited prior to registration. Private limited companies with authorized share capital above the minimum amount must deposit 20% of the amount of money.

Both types of companies are required to have at least two shareholders, even if the Company Law permits a single shareholder to set up a company in Malta.

 

Steps to open a company in Malta

The main steps to set up a company in Malta are:

  • to register a company name with the Maltese Commercial Register,
  • to draft and notarize the company’s memorandum and articles of association,
  • to deposit the minimum share capital with the chosen bank,
  • to file the application and the other documentation required with the Trade Register.

The documents to be filed with the Malta Trade Register are:

  • a confirmation of the company name reservation,
  • the memorandum and articles of association,
  • the bank receipt confirming the share capital deposit,
  • certified passport copies of the shareholders, directors and company secretary.

Once the Malta company is registered, it must acquire a business license, register for VAT and with the Employment Training Corporation.

 

How long does it take to register a company in Malta?

Business name reservation

A few hours

Drafting and notarizing incorporation documents 1 day

1 day

Depositing the share capital

1 day

Register for employment purposes

1 day

Company and tax registration

2 days

Obtain an employer identification number

3 days

VAT registration

7 days