Malta Business Registry

The Malta Business Registry is a Maltese government agency responsible for the registration and regulatory compliance of companies and commercial partnerships within its jurisdiction.

Malta Business Registry
Reġistru tan-Negozju ta ’Malta

Malta Business Registry Building
Agency overview
Formed2018
Preceding agency
  • Malta Registry of Companies
JurisdictionMalta
HeadquartersMalta Business Registry AM Business Centre, Triq il-Labour, Zejtun 2401, Malta
Agency executive
  • Joseph Farrugia, Registrar/Chief Executive Officer
Key document
WebsiteOfficial website

Powers

The Malta Business Registry is responsible for the registration of new companies and commercial partnerships, the registration of documents related to commercial partnerships, the issuing of certified documentation including certificates of good-standing, the reservation of company names, the collection of registration and other fees, the publication of notices and the imposition and collection of penalties.[1][2] The Registry is also charged with conducting investigations of companies and maintaining Malta's company and partnership register.[3][4][5]

History

Malta Business Registry's (MBR) functions were previously held by the Registry of Companies as part of the Malta Financial Services Authority (MFSA).[6][7] The Registry of Companies became a stand-alone agency and was renamed the Malta Business Registry in 2018.[8][9] Its new offices were inaugurated in Zejtun by then Prime Minister Joseph Muscat in June 2019.[10][11] It was claimed that the MBR would be the first government agency to run on blockchain technology to increase transparency and reduce bureaucratic procedures.[12] The Registry's online system, first developed in 2004, was slated for replacement by the end of 2020.[13] The agency is expected to be fully digitised and paperless by 2021.[14]

The agency had approximately 96,000 companies on its books in 2020[15][16] and reported a net increase of 4,472 new companies registered in 2019.[17][13] MBR reported an operational surplus of €10 million on an income of €16 million for financial year 2019.[18][14] Investments in fixed assets also totalled €6 million for the year.[13][19]

Controversy

In 2019, Malta's anti-money laundering regime was found to be inadequate by an expert review of the Council of Europe (Moneyval).[20][21] The OECD similarly noted a lack of relevant information on commercial entities and the low annual filing rates of companies.[22][23][24] University of Malta research also confirmed a "tendency to comply only at a superficial level with the principles of good corporate governance" in Malta.[25][26] This lack of transparency, it was suggested, would not fully protect the interests of these entities' shareholders and trading partners.[25]

Subsequently, legislation was enacted requiring the accurate publication of ownership and financial data of Malta listed companies.[27][28] Random sampling assessments were then initiated in Spring 2020 by the MBR[29][30] and 10,000 non-compliant entities were struck-off the registry.[31][32] As of December 2020, despite being listed as active (and in purportedly good standing) some companies had still not submitted the requisite information for at least the last five years.[33][34] In July 2020, Joseph Farrugia, the Registry CEO, had stated that 54,000 listed companies (out of circa 95,000) conformed to MBR regulation.[35][15] The proportion of materially non-compliant companies listed on Malta's registry remains unclear.[29]

Despite the dramatic growth of penalty amounts for non-compliance, critics argue that financial penalties alone are not an effective enforcement tool for the Maltese regulator.[36][37] It was proposed that the publication of the status of each non-compliant company (publication of warnings, judicial letters and court filings) should also make part of the remedy.[36][38]

References
  1. "Business registry signs MOU with official authorities to collaborate, share information". www.maltachamber.org.mt. Retrieved 2020-09-08.
  2. "Companies Act". Malta Business Registry. 2019-06-09. Retrieved 2020-09-08.
  3. "About MBR". Malta Business Registry. 2019-06-09. Retrieved 2020-09-08.
  4. "Malta's registrar given new powers to check beneficial ownership | STEP". www.step.org. Retrieved 2020-09-09.
  5. "Malta". United States Department of State. Retrieved 2020-09-14.
  6. "Opening of new Registry of Companies offices". MFSA. 4 February 2005.
  7. Company law was introduced in Malta by the Commercial Partnerships Ordinance of 1962. The Register originally came under the Commerce Department, a Government department. It became a part of the Malta Financial Services Authority in 1997 following the introduction of the new Companies Act in 1995.
  8. LEĠIŻLAZZJONI MALTA (30 April 2018). "MALTA BUSINESS REGISTRY (ESTABLISHMENT AS AN AGENCY) S.L. 595.271". legislation.mt. Retrieved 2020-09-08.
  9. "Operation of the business registry", UNCITRAL Legislative Guide on Key Principles of a Business Registry, UN, pp. 26–46, 2019-06-10, doi:10.18356/a7b39987-en, ISBN 978-92-1-047925-7
  10. "Malta Business Registry offices inaugurated by PM in Żejtun - The Malta Independent". www.independent.com.mt. Retrieved 2020-09-09.
  11. "Inauguration of Malta Business Registry - TVM News". TVM English. Retrieved 2020-09-09.
  12. "Company Register clean-up: 10,000 inactive companies deleted - TVM News". TVM English. Retrieved 2020-09-22.
  13. "MBR's system overhaul a first step in enabling a digital ecosystem for Maltese companies – Kenneth Brincat". whoswho.mt. Retrieved 2020-11-14.
  14. "Annual Report 2019". Malta Business Registry. 2020-06-02. p. 5. Retrieved 2020-09-24.
  15. "10,000 companies taken off registry". Times of Malta. Retrieved 2020-09-09.
  16. "Malta removes 10,000 companies from Malta Business Registry". The Sovereign Group. 2020-08-26. Retrieved 2020-09-22.
  17. https://ec.europa.eu/docsroom/documents/38662/attachments/20/translations/en/renditions/native
  18. Weekly, The Malta Business (2020-06-18). "The MBR publishes its 2019 Annual Report and Financial Statements". The Malta Business Weekly. Retrieved 2020-09-24.
  19. "Annual Report 2019". Malta Business Registry. 2020-06-02. Retrieved 2020-11-14.
  20. "Malta risks blacklisting as Moneyval exposes gaps in financial crime fight". Times of Malta. Retrieved 2020-09-09.
  21. "Malta". Committee of Experts on the Evaluation of Anti-Money Laundering Measures and the Financing of Terrorism. Retrieved 2020-09-09.
  22. "Malta downgraded by OECD over tax transparency concerns". Times of Malta. Retrieved 2020-09-14.
  23. Bonnici, Julian (2020-09-10). "Seven Years Of Inaction Downgrades Malta's Tax Transparency Rating: What That Means For The Country". Lovin Malta. Retrieved 2020-09-19.
  24. "Global Forum on Transparency and Exchange of Information for Tax Purposes: Malta 2020 (Second Round) | READ online". OECD iLibrary. Retrieved 2020-10-16.
  25. Baldacchino, Peter J.; Duca, Nirvana; Tabone, Norbert; Grima, Simon (2020-04-05). "Corporate Governance Transparency in Small Listed Entities: The Case of Malta". European Research Studies Journal. XXIII (2): 23–44. doi:10.35808/ersj/1578.
  26. Cremona, Marise (2012-03-15). Compliance and the Enforcement of EU Law. OUP Oxford. ISBN 978-0-19-163025-5.
  27. "Transparency is a top priority for companies". Times of Malta. Retrieved 2020-09-09.
  28. "Recent Amendments to the Companies Act Regulations". www.bdo.com.mt. Retrieved 2020-09-14.
  29. "Beneficial Ownership in Exchange of Information for Tax Matters", Beneficial Ownership in Tax Law and Tax Treaties, Hart Publishing, 2020, doi:10.5040/9781509923106.ch-007, ISBN 978-1-5099-2307-6
  30. GOVERNMENT OF MALTA (17 March 2020). "Malta Financial Services Oversight newsletter". Malta Business Registry confirms 1,654 companies struck off.
  31. "Malta Business Registry to remove 10,000 inactive companies from registry - The Malta Independent". www.independent.com.mt. Retrieved 2020-09-09.
  32. maltawinds.com (2020-07-18). "The extensive process of striking off inactive companies begins". maltawinds.com. Retrieved 2020-09-09.
  33. See sample search results for companies C 56452, C 58040, C 38838, SV 65 on the MBR Register taken in November 2020
  34. Sapiano, Luigi (2020-08-07). "PN And Labour's Media Wings Should Have Been Fined A Combined €58,000 For Failing To Publish Audited Accounts". Lovin Malta. Retrieved 2020-09-19.
  35. "Company Register clean-up: 10,000 inactive companies deleted - TVM News". TVM English. Retrieved 2021-01-08.
  36. Carlo Farrugia, Information Office, Malta Financial Services Authority, Attard. "Penalties for late submission of accounts". Times of Malta. Retrieved 2020-09-22.CS1 maint: multiple names: authors list (link)
  37. "Owners, officers of Maltese companies take note − you might just be in default". Times of Malta. Retrieved 2020-11-09.
  38. "Penalties and enforcement by the Malta Business Registry". Times of Malta. Retrieved 2021-02-04.
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