Author: Sarah Grima, Associate
These FAQs are the second part of a two-part series regarding the procedure and requirements at law concerning the continuation (or re-domiciliation) of companies, in terms of the Continuation of Companies Regulations (the “Regulations”).
Part 1 of the FAQs discussed the process of continuation of companies into Malta, while this Part 2 shall consider the process of continuation outside Malta. You may access Part 1 of the FAQs here.
What are the eligibility requirements for a Maltese company to be registered as being continued outside Malta?
- The country or jurisdiction selected for the Maltese company to be registered as a company continued under its laws, must be an approved country of jurisdiction;
- The law of the selected country or jurisdiction must allow for foreign companies to be continued in its jurisdiction as if they had been incorporated under the laws thereof;
- The Maltese company must be in good standing, such that all statutory filings, fees and penalties due are settled prior to initiating the re-domiciliation process.
What is the procedure for the continuation of a company outside Malta, and what are the documents involved?
A request must be made by the Maltese company to the Maltese Registrar of Companies for the latter’s consent to be continued as a company outside Malta under the laws of an approved country or jurisdiction, which must be accompanied by the following documentation:
1. a declaration signed by at least two (2) directors of the company, containing:
- the name of the company and, if different, the name under which registration in the approved country or jurisdiction is being sought;
- the place of proposed registration of the company and the name and address of the competent authority in that approved country or jurisdiction;
- the date on which it is proposed to establish domicile in the relevant approved country or jurisdiction.
2. an extraordinary resolution of the shareholders of the Maltese company authorising such request for consent;
3. a declaration signed by at least 2 directors of the Maltese company confirming that the company is solvent and that the directors are not aware of any circumstances which may negatively affect such solvency in a material manner within the next 12 months.
Are there any additional requirements applicable in the case of licensed companies?
Yes. Where the company carries on licensable activity in or from Malta, it must also provide the Maltese Registrar of Companies with evidence of the consent of the competent authority in Malta to the company continuing in another country or jurisdiction.
Are there any additional requirements applicable in the case of public companies?
Yes. Where the company is a public company quoted on a recognized stock exchange, it must also provide the Maltese Registrar of Companies with evidence of the consent of the said exchange and of the listing authority in Malta to the company continuing in another country or jurisdiction.
Are there any time periods to consider, and can these be waived or reduced?
Yes. The Registrar shall not give his consent to the continuation of a Maltese company in another approved country or jurisdiction until the lapse of 3 months from the publication of a notice (in the Gazette and in a daily Maltese newspaper) relating to the extraordinary resolution of the Maltese company authorizing the request for consent to be continued as a company outside Malta under the laws of an approved country or jurisdiction.
During the said 3 month period, any creditor of the Maltese company whose debt existed prior to the publication of the stated notice may object to the proposed continuation and, if good cause is shown as why this should not take effect, the Court shall either uphold the objection or allow the continuation of the company on sufficient security being given.
Said time period cannot be waived or reduced.
Is the Registrar’s consent to be continued outside Malta subject to any fees?
Yes. The granting of consent by the Maltese Registrar of Companies for a company to be continued outside Malta is subject to a statutory fee of EUR1,000.
How is the date of continuation outside Malta determined and what is the effect?
Following the lapse of the statutory 3-month period, and provided the Court does not uphold any objection of the creditors of the company which may have been raised during the said period of time, the Maltese Registrar of companies shall issue his consent, and the company will be able to register with the foreign jurisdiction.
The date of the company’s continuation outside Malta shall be the date of the instrument of continuation that is issued by the foreign country or jurisdiction.
Following receipt of the instrument of continuation issued by the foreign country or jurisdiction, the Registrar of Companies in Malta will strike the name of the company off the register.
Can the consent of the Maltese Registrar of Companies be refused?
Yes. The Registrar shall refuse to give consent for the registration of a company as being continued outside Malta, unless he is satisfied that:
- the requirements for the request for consent have been complied with by the Maltese company;
- no proceedings for the dissolution or winding up or insolvency of the company have commenced in Malta or elsewhere;
- the pledgee of shares, if any, has given his consent in writing to the intended continuation of the company in another country or jurisdiction;
- the company is not in breach of any of its duties or obligations under the Companies Act;
- the 3-month creditor has effectively lapsed.
Should you require any further information or assistance on the matter, please do not hesitate to reach out to Sarah Grima personally on firstname.lastname@example.org.
©Fenech & Fenech Advocates 2021
Disclaimer │ The information provided on this Update does not, and is not intended to, constitute legal advice. All information, content, and materials available are for general informational purposes only. This Update may not constitute the most up-to-date legal or other information and you are advised to seek updated advice.