Amendments to the Companies’ Act – Act LX of 2021 

by , on Nov 29, 2021 08:00:37 AM


Amendments to the Companies Act (Chapter 386 of the Laws of Malta) were introduced in virtue of Act LX of 2021, enacted on the 26th of October 2021. Such amendments work towards amplifying transparency of information regarding directors and shareholders of companies registered in Malta. The following are the main features which the amendments have put forward;  


Information to be Included within Documents Provided to the Registrar of Companies for Registration  

Documents including an individual’s name and residence which are to be submitted to the Registrar of Companies for registration must henceforth incorporate that individual’s date of birth, in the case of a natural persons, or the company registration number, in the case of a body corporate.  

Within the memorandum and articles of association of a company submitted for registration, natural persons who are subscribers, first directors, and first company secretary or secretaries may designate a service address rather than a residential address. Additionally, the company’s e-mail address must now be disclosed, although the MBR is yet to confirm whether a director’s email address can be utilised. Nevertheless, the residential addresses of shareholders, directors, and company secretaries will still be required for incorporation within the new register of registered residences of officers and shareholders.  


Register of Residential Addresses of Officers and Shareholders  

In addition to the statutory registers that companies are already obliged to keep and maintain, companies are now bound to retain a register of the residential addresses of their officers and shareholders, which must include details such as the names and e-mail addresses of the company’s officers and shareholders. Such Register must be distributed to the Registrar of Companies, along with any modifications introduced thereto and the relevant statutory form, within 14 days. When a statutory Form K indicating a shift in director or company secretary is forwarded, this register must also be sent to the Registrar of Companies. A one month grace period shall be given to directors who fail to adhere to this obligation, following which fines will be imposed. The Registrar also has the power to refuse to register any alterations in officers or shareholders if records are not filed or if the information supplied is not up to date and accurate.  


Appointment and Disqualifications of Directors  

An individual cannot be appointed as a director unless he has physically signed the memorandum confirming his assent to act as director or has signed and sent his consent to function as director in writing to the Registrar of Companies. Formerly, this was merely a necessity for public companies, though it has now been broadened to include private companies as well.  

The Act also provides that a person shall not be qualified for appointment or to hold Office as director or company secretary if such person is holding such Office as a company service provider in terms of the Company Service Providers Act without the necessary authorisation from the MFSA. Additionally, the Registrar of Companies may decline to appoint a director if that individual would be barred from serving as a director within any other EU member state.  

When an individual is appointed as a director, he must state whether he is knowledgeable of any circumstances that might disqualify him from being appointed or holding office as a director. When the Registrar of Companies advises a company that one of its officers is disqualified to act or does not have a license under the Company Service Providers Act, the company must withdraw that individual as a director and submit the appropriate statutory form with the Registrar. In the event of non-compliance, the Registrar of Companies will submit a removal application in Court.  


New Duties of the Registrar of Companies  

New responsibilities for the Registrar of Companies have been introduced by means of the Act. Such responsibilities would include the duty to take all reasonable steps, prior to registering a new company or return, to verify the individual’s identity and the accuracy of the information presented, and to provide full access to competent authorities and subject individuals, as described within the Prevention of Money Laundering and Funding of Terrorism Regulations.  

Undoubtedly, the revisions brought about by Act LX of 2021 entail new requirements on directors and company service providers, as well as the Registrar, and it is yet to be determined whether any form of transitional period would be allowed to allow companies to comply with such demands.  

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