The Register of Beneficial Owners
As of 1st January 2018, all Maltese Companies (including commercial partnerships and shipping companies) are now obliged to identify, record and report beneficial owners to the Registry of Companies, in compliance with the recently published Companies Act (Register of Beneficial Owners) Regulations 2017 (the “Regulations”) – Legal Notice 374 of 2017.
1. Applicability of the Regulations
The new regulations apply to both new and existing companies (including partnerships en nom collectif, en commandite and limited partnerships) either formed under the Companies Act or registered under the Merchant Shipping (Shipping Organisations-Private Companies) Regulations as well as to companies domiciled to Malta in terms of the Continuation of Companies Regulations.
The Regulations do not apply to:
- companies listed on a regulated market being subject to disclosure requirements consistent with EU Law; and
- companies, the registered shareholders of which are natural persons disclosed in the public records kept by the Registrar of Companies.
2. New Registrations of Companies:
(i) As from the 1st of January 2018, companies seeking to be registered or re-domiciled in Malta must now submit a declaration on beneficial owners to the Registrar of Companies (in the prescribed form), which must be signed by at least two directors (unless one director has been appointed) along with the necessary documents to be constituted and registered in Malta. Registration or re-domiciliation will not be possible until the Registrar of Companies is in receipt of this document.
The information to be submitted on the beneficial owners – name, date of birth, nationality, country of residence, an official identification document number indicating the type of document and the country of issue, and the nature and extent of beneficial interest held – shall then be entered and held by the Registrar of Companies in a separate Register of Beneficial Owners.
(ii) Companies are further obliged to maintain their own beneficial owners’ register which aside from recording the details mentioned above in respect of the beneficial owners, must indicate the effective date on which they became or ceased to be beneficial owners of the company or have increased or reduced their beneficial interest in the company. Any change in the beneficial ownership must be further notified to the Registrar of Companies within 14 days after the date on which the change is recorded with the company.
(iii) Notices delivered to the Registrar regarding the transfer or transmission of shares; an increase or reduction of share capital; or a restructuring of a company’s share capital or voting rights will further be accepted and registered if accompanied with a further notice indicating whether or not there has been a change in the beneficial ownership of the company and providing updated information, if applicable.
3. Existing Companies (those registered prior to the 1st of January 2018)
Existing Companies have similar reporting obligations, but have been given a six month grace period to comply with the Regulations, as follows:
(i) All existing companies must set up and maintain their own internal beneficial owner register which should contain the same information as mentioned earlier above, by the end of June 2018.
(ii) As from the end of June 2018, existing companies shall either on the anniversary of their registration or where there is any change in the beneficial ownership, whichever is the earlier submit the declaration on beneficial owners to the Registrar in the prescribed form.
4. Access to the Registrar’s Register of Beneficial Owners
Request to access the Register of Beneficial owners as held by the Registrar of Companies shall be permissible as from 1st April 2018 by:
(i) National Competent Authorities with designated responsibilities for combatting money laundering and terrorist financing or that have investigative and prosecuting powers in relation thereto.
(iii) National tax authorities.
(iv) Subject Persons, for the purpose of carrying customer due diligence in terms of the Prevention of Money Laundering and Funding of Terrorism Regulations providing services in or from Malta.
(v) Any person or organisation that can satisfactorily demonstrate and justify a legitimate interest.
Non-compliance with these Regulations may attract a joint and several liability of the Company and its officers (and in certain cases also it shareholders and beneficial owners) with penalties reaching Euro 1000 (plus Euro 10 daily for every day that the default continues), particularly or more specifically for failing:
(i) To keep a record of beneficial owners.
(ii) To report a change in the beneficial ownership of a company.
(iii) To obtain and maintain adequate, accurate and current information in respect of all beneficial owners within six months from the coming into force of the Regulations; and
(iv) To submit a declaration containing information on the beneficial owners of the company.
Where misleading, false or deceptive information about beneficial owners is provided to the Registrar, this constitutes a criminal offence and is subject to a fine up of up to Euro 5000 or to imprisonment of a term not exceeding six months or to both such fine and imprisonment.
The information provided herein is for general guidance only and if you have specific queries or require clarifications on the Regulations, please refer to our colleagues at Fenlex Corporate Services Ltd on email@example.com.