Inflows Increase as Substance gains Momentum

Malta’s proven track record in handling complex cross-border transactions has helped the island to win new business as the global drive for greater transparency sees investors increasingly favour onshore business models.

Malta’s role in global deal making has been capturing the attention of blue-chip corporations and corporate planners.  The know-how of the island’s professional service providers in structuring international transactions and investments into Europe and emerging markets around the world is ever more appreciated. At a time when regulatory changes at EU and OECD levels are reshaping the international business landscape, Malta offers global corporations the complete package that includes fully EU-compliant legislation, low cost structures and experienced service providers who have a proven track-record and the corporate engineering skills to support the most complex of transactions, all within a well-regulated finance centre. 

 

Fully Committed 

Malta is not resting on its laurels and the island’s agency for registering companies, the Malta Business Registry, is aiming to become the first company registry in the world that is completely run on blockchain. This is part of Malta’s focus to become the go-to digital international finance centre that has signed up to all international standards and adopted best practice. Malta emphasises that it is neither a tax haven nor a secrecy jurisdiction. The island keeps its regulatory framework in sync with the changing demands of the industry and in line with the requirements laid out at EU level. The country operates a full imputation tax system, which has been approved by the EU. Companies are taxed at a rate of 35%. However, shareholders are entitled to a 6/7ths refund for the tax paid by the company. The OECD International Tax Cooperation Report showed Malta to be among the world’s most tax-compliant countries. The country has commenced exchanging information in line with the Common Reporting standard and has activated a tax information exchange network. The country’s Anti-Money-Laundering laws are all up to date, and a register of beneficial owners has been established to increase corporate transparency and accountability as well as combatting crime. 

 

The Malta Company 

Setting up in Malta is a relatively quick process; it takes no more than a few days to establish a company. This is expected to decrease even further, to possibly minutes, when Malta’s new blockchain registry is fully up and running. The most commonly used vehicle for international business is the Limited Liability Company. A Malta company is the ideal vehicle for a wide range of business activities, ranging from property ownership to the management of eCommerce activities and financial services. Malta companies are also increasingly being used for cross-border acquisitions. Foreign companies usually establish a Malta company as a European base, which then either acquires another European company or group, or carries out a cross-border merger. 

For companies looking to re-domicile their operations to the island, the legislation allows foreign companies to change their domicile to Malta, without the need of winding up their operations in their home country. This ensures substantial cost savings for the company and makes it attractive for already established companies to move their seat to Malta, while Maltese law allows for companies to re-domicile out of Malta in an equally straightforward process. 

 

A key Corporate Location 

The global push for substance, transparency and real economic activity is very much playing to Malta’s strengths. The island stands out as a cost-effective EU jurisdiction with a well-educated workforce that is able to deliver innovative solutions to complex transactions. The country’s network of 70 double taxation treaties further strengthens its position as a key corporate location. With a regulatory framework that has received the seal of approval by most international standard setting bodies, Malta has developed a reputation as a quality jurisdiction that ticks all the boxes. 

 

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