On the 11th of July 2025, Act XVII of 2025 was enacted which amended several provisions of the Maltese Companies Act. One of the most significant amendments is the addition of a new simplified liquidation procedure with the introduction of Article 214A.
Companies which have never traded or have stopped trading are now provided with a simplified and less-costly liquidation procedure to efficiently strike off their name from the Registry. This new simplified procedure can be used when companies’ member(s) initiate a voluntary Winding Up.
Eligible Companies
For a company to be able to initiate this faster procedure, it must be validly registered for at least six months. Regulated entities and public companies are not permitted to make use of this method. Additionally, throughout the six-month period before an application for the simplified liquidation procedure is submitted to the Registrar, the company must not have:
- Changed its name
- Traded or carried on business
- Employed any individuals
- Had any outstanding filings, documents, or penalties due to the Registrar
- Had any of its shares pledged
Applying for the Simplified Liquidation Procedure
An application is filed on the submission of a prescribed form to the Registrar and must be signed by the directors of the company. The application must include:
- The prescribed B1 form
- A signed declaration by all directors confirming that the company:
- Is not a regulated entity
- Only has its shareholders or current officers or service providers as creditors
- Has no pending court cases
- Does not have assets valued at more than €5,000
- Has not entered into any deeds or contracts in the last six months other than with its service providers, if applicable
- Has no outstanding amounts due to any government authority or body
- A confirmation by the directors that:
- A shareholder’s resolution has approved to use the simplified voluntary dissolution procedure in accordance with the company’s memorandum and articles of association
- All the company’s bank accounts have been closed
- The submission of an online application for the company’s de-registration for Maltese VAT purposes, if applicable
- The only employees are officers of the company
Additionally, the directors must also confirm in their personal capacity that they are retaining the details of the beneficial owners and financial records as mandated by law. If they do not hold this designation, they must duly inform the Registrar as to the identity of such person.
In the case where these conditions are met, the company may be struck off without undergoing the standard liquidation procedure as per the Act. This is because the company is considered inactive through having no trades, liabilities or complex assets which require a formal liquidation procedure.
Three months before the striking-off, the Registrar will publish a notice in the Government Gazette and on the Registry’s website of the striking-off of the company. During this period, the director/s and secretary of the company retain all their power and duties over the company until the striking-off date since there is no need for a liquidator to be appointed in this procedure. Under this procedure and as aforementioned, the directors are obliged to hold the company’s beneficial owners and financial records.
To sustain unbiased and fair treatment of all stakeholders, the amendments provide a restoration remedy to any interested party once the company has been struck-off. In addition, any director which makes a false declaration in relation to an interested party during the striking off procedure may be liable on conviction to a fine (multa), imprisonment or both.
The effects of this procedure are yet to be seen on Article 214A’s interpretation and application. However, this welcomed new addition to the Companies Act is deemed to enhance efficiency and reduce the burden on inactive limited liability companies allowing a fast liquidation process.
How BDO Can Help
The Legal Team at BDO is here to help you navigate the new procedure. Should you require any further information or assistance, the team may be contacted here.
This article was written by Legal Intern Martina Galea and reviewed by Senior Lawyer Jianni Grima
