Proposed Amendments to the Companies Act

Key Corporate Reforms of the Companies Act

Among the key changes is a push for greater use of electronic communication. Company secretaries and directors will be required to monitor the registered email address of the company. If the address changes, a notification must be filed with the Registrar within 14 days. The process for updating this address has also been simplified and may now be effected through a board resolution and the filing of a corresponding return, removing the need to amend the company’s Memorandum and Articles.

For the first time, the rights of a usufructuary of shares will be regulated through introduction of Article 117A. Under the new provision, usufructuaries may attend general meetings and receive dividends, but may only vote if this right is expressly granted in the deed of usufruct or in the company’s Memorandum and Articles.

The Bill also introduces a new requirement for the notification of share pledges. Either the pledgor or the pledgee must notify the Registrar within 14 days by delivering a notice and a document detailing the contract particulars. The company whose shares have been pledged must also be notified in writing within the same timeframe.  

A simplified dissolution procedure is proposed for unregulated private limited liability companies. Article 214A will allow such companies to dissolve by submitting a prescribed form signed by all directors.

The procedure does not require the need to appoint a liquidator, with directors and the company secretary retaining their authority and assuming full responsibility for compliance.

Amendments relating to partnerships are also included, particularly concerning capital contributions. Contributions made by new partners will take immediate effect upon receipt, with no need to amend the partnership deed – streamlining administrative procedures. 

A notable innovation is the introduction of new cell company structures. These are expected to enhance Malta’s competitiveness in corporate transactions, particularly those involving ring-fenced assets such as mergers and acquisitions.

Removal of “Exempt” Classification for Private Companies

Finally, the Bill reclassifies private companies qualifying under Article 211 by removing the term "exempt". The change aims to make the local framework more transparent and accessible, especially for foreign investors, while the substantive benefits of these companies remain unaffected. 

The Bill is expected to boost operational efficiency, improve flexibility, and reinforce Malta's status as a dynamic and transparent business hub. 

 

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