Malta Free Zones in 2024

• Free zones are not a novel concept for Malta, considering it came up with its first free zone – the Malta Freeport in 1988 which still plays a huge part in Malta’s presence as an international trade and shipping hub;
• Given its strategic location, it serves as an ideal gateway between Europe and Northern Africa, and its importance has increased manifold since it became a part of the EU in 2004;
• The Malta Free Zones Act: Act XV of 2019, aims at encouraging the creation of more customs-free zones across the Maltese islands;
• These zones can be designated either by the Maltese government or by any other EU member government;
• They will allow the tax-exempt import of non-EU goods by a licensed company;

Key considerations of Malta free zone company registration

• The free zone company is a legally tax-exempt entity incorporated by foreign investors wishing to use Malta as a gateway to reach consumers across Europe, Northern Africa and the Middle East;
• Exemption on corporate tax minimizes withholding tax on remittance to other countries and no customs duties are imposed on goods imported and exported from the free zone;
• Malta free zone companies do not require a Maltese national shareholder. While it is mandatory to rent an office, it is not necessary to hire staff;
• Other benefits include i) low bureaucratic requirements for incorporation; ii) fewer restrictions relating to staff recruitment; iii) no import/export taxes; iv) high quality infrastructure facilities and v) competitively priced energy and utilities;

Legal considerations

It is mandatory to obtain a licence from the free zone authority before setting up a company within a free zone in Malta. The free zone authority will want complete disclosure of general information on the applicant of the license as well as the main shareholders, the proposed activities, inclusive of various permission grants corresponding to the activities, expected facility requirements, financial information (source of capital investment, projected earnings), and any other corporate documents deemed necessary based on the type of business.

The requirements to set up a company are:

• Registered office: It is mandatory for a Malta free zone company to maintain a registered office address within the free zone territory
• Objects: The objects of the company need to be clearly outlined in the Articles and Memorandum of Association. Objects include details of director(s), shareholder(s), primary income generating activity, paid-up capital;
• Capital requirements: The minimum capital required to set up a company in Malta is €1,165, of which 20% needs to be paid-up at the time of incorporation;
• Shareholding: A minimum of two shareholders is required, unless the entity is registered as a single-person entity;
• Directors: Any person (individual or body corporate) can act as a director of a Maltese company. In case of a public company, at least two directors must be appointed;
• Company secretary: Any registered company secretary (individual) can be appointed as the company secretary for the new Malta company.

Healy Consultants Group can assist in setting up a fully compliant and functioning Malta free zone company in three weeks. It will then take one month to secure a local corporate bank account for the entity.