COMPANIES ACT
To regulate, in place of the Commercial Partnerships Ordinance, limited liability companies and other commercial partnerships.
1st January, 1996
ACT XXV of 1995 as amended by Acts XXIV of 1995, IX and XXX of 1997, XVII of 1998, XXII of 2000, XVII of 2002, IV and IX of 2003, and II and XIII of 2004; Legal Notices 390 and 391 of 2005, and 181 and 186 of 2006; Acts V and XII of 2006, and XV of 2007; Legal Notice 425 of 2007; and Acts IX of 2008 and III of 2009.
ARRANGEMENT OF ACT
Articles Short title 1 PART I Preliminary Provisions 2-3 PART II General Provisions 4-6 PART III Partnership En Nom Collectif 7-50 PART IV Partnership En Commandite 51-66A PART V Limited Liability Company 67-326 Title I Formation and Functioning of Companies 67-213 Chapter I Formation of a company and matters incidental thereto 67-82 Chapter II Changes to a company’s share capital 83-88 Chapter III Capital issues by public companies 89-96 Chapter IV Allotment of shares and debentures of companies 97-103 Chapter V Maintenance of share capital and protection of class rights 104-116 Chapter VI Miscellaneous provisions about shares and debentures 117-127 Chapter VII Meetings and resolutions 128-135 Chapter VIII Management and administration 136-150 Chapter IX Auditors 151-162 Chapter X Accounts, audit and annual return 163-191 Chapter XI Distribution of profits and assets 192-208 Chapter XII Private company 209-213 Title II Dissolution and Consequential Winding up of Companies 214-326 Sub-title I Winding up by the court 218-264 Chapter I General provisions 218-224 Chapter II Official receiver 225-227 Chapter III Liquidators in a winding up by the court 228-244 Chapter IV Liquidation committees in a winding up by the court 245-247 Chapter V General powers of the court in a winding up by the court 248-264 Sub-title II Voluntary winding up 265-294 Chapter I General provisions 265-268 Chapter II Provisions applicable to a member’s voluntary winding up 269-276 Chapter III Provisions applicable to a creditor’s voluntary winding up 277-285 Chapter IV Provisions applicable to every voluntary winding up 286-294 Articles |
Sub-title III | Provisions applicable to every mode of winding up | 295-326 |
Chapter I | Effect of appointment of liquidator and convening of meetings | 295-300 |
Chapter II | Proof and ranking of claims | 301-302 |
Chapter III | Effects of winding up on antecedent transactions | 303-304 |
Chapter IV | Qualification of liquidators and prohibition of certain transfers by liquidators | 305-306 |
Chapter V | Offences antecedent to dissolution or in course of winding up | 307-321 |
Chapter VI | Supplementary Provisions | 322-326 |
PART VI | Company Reconstructions | 327-329B |
PART VII | Conversion Of Commercial Partnerships | 330-335 |
PART VIII | Amalgamation Of Commercial Partnerships | 336-359 |
Title I | Amalgamation Of Partnerships En Nom Collectif And En Commandite | 336-342 |
Title II | Amalgamation Of Companies | 343-359 |
Chapter I | Merger by acquisition | 344-356 |
Chapter II | Merger by formation of a new company | 357 |
Chapter III | Acquisition of one company by another which holds ninety per cent or more of its shares | 358-359 |
PART IX | Division of Companies | 360-375 |
Chapter I | Division by acquisition | 361-373 |
Chapter II | Division by the formation of new companies | 374 |
Chapter III | Division by a combination of a division by acquisition with a division by the formation of one or more new companies | 374A |
Chapter IV | Division under the supervision of the court | 375 |
PART X | Association En Participation | 376-383 |
PART XI | Bodies Corporate Constituted Outside Malta | 384-399A |
Chapter I | Provisions as to establishment of place of business in Malta | 384-389 |
Chapter II | Issues by companies constituted or incorporated or to be constituted or incorporated outside Malta in a non-Member State or non-EEA State | 390-398 |
Chapter III | Provisions as to the winding up of the affairs in Malta of an oversea company | 399-399A |
PART XII | General | 400-427 |
PART XIII | Transitional and Final Provisions | 428-431 |
| SCHEDULES | |
First Schedule | Model regulations for a limited liability company | |
Second Schedule Matters to be specified in a prospectus and reports to be set out therein
Third Schedule Form and content of individual accounts
Fourth Schedule Form and content of consolidated accounts
Fifth Schedule Individual accounts and directors’ report of an investment company with variable share capital
Sixth Schedule Contents of directors’ report Seventh Schedule Contents and form of annual return Eighth Schedule Conversion rules applicable on a change in the currency in which the
share capital of a company is expressed and the corresponding reporting currency
Ninth Schedule Explanation of expressions used in subarticle (2) of article 2 and provisions supplementary thereto
Tenth Schedule Partnerships en commandite or limited partnerships
Eleventh Schedule Penalties
Twelfth Schedule Table of Concordance 4 | CAP. 386.] | COMPANIES |
Short title. | 1. | The short title of this Act is the Companies Act. |
| | PART I -PRELIMINARY PROVISIONS |
Interpretation.
Amended by:
XXIV. 1995.362;
IV. 2003.26;
L.N. 391 of 2005;
XV. 2007.2;
L.N. 425 of 2007;
IX. 2008.4.
Cap. 281.
2. (1) In this Act, unless the context otherwise requires, the following expressions have the meaning hereby assigned to them -
"annual accounts" means the individual accounts required by article 167 and, where applicable, also the consolidated accounts required by article 170;
"appointed day" means the date appointed by the Minister for the coming into force of this Act;
"approval" in relation to a prospectus means the positive act at the outcome of the scrutiny of the completeness of the prospectus by the Registrar or the regulatory authority of the Member State or EEA State, as the case may be, including the consistency of the information given and its comprehensibility, within the meaning of the Prospectus Directive;
"auditor" shall have the meaning assigned to it in the Accountancy Profession Act or regulations issued in terms thereof;
"body corporate" means any entity having a legal personality distinct from that of its members, and includes a foreign corporation;
"certificate of registration" when used in relation to a company means a certificate of registration issued under this Act or under the Ordinance and the words "registration", "registered" and their derivatives shall be construed accordingly;
"commercial partnership" means a company or other commercial partnership formed and registered under this Act or formed and registered under the Ordinance where applicable;
"the Community" means the European Community established by the Treaty of Rome in 1957 and amended institutionally and otherwise in 1986 by the Single European Act, in 1993 by the Treaty on European Union, in 1997 by the Treaty of Amsterdam and in 2001 by the Treaty of Nice, and as amended by accession agreements and as may be further amended from time to time;
"company" means a company formed and registered under Part V of this Act or the Ordinance;
"company secretary" means a person being an individual who holds the office of a company secretary in terms of article 138;
"consolidated accounts" means the accounts required by article 170;
"contributory" shall, unless otherwise stated, have the meaning assigned to it by articles 215 to 217;
"court" means the Civil Court, First Hall;
"debenture" includes debenture stock, bonds and any other debt securities of a company;
"director" includes any person occupying the position of director of a company by whatever name he may be called carrying out substantially the same functions in relation to the direction of the company as those carried out by a director;
"directors’ report" in relation to a company, means the directors’ report required by article 177;
"EEA State" means a State which is a contracting party to the agreement on the European Economic Area signed at Oporto on the 2nd May, 1992 as amended by the Protocol signed at Brussels on the 17th March, 1993 and as amended by any subsequent acts;
"equity securities" means shares and other securities which are equivalent to shares in companies or which are convertible to such shares, or securities which give such right of conversion, provided such securities of the latter type are issued by the issuer of the underlying shares or by an entity belonging to the group of the said issuer, and the term ‘non-equity securities’ shall be construed as referring to all securities that are not equity securities;
"euro" refers to the currency unit of the participating states in the European Monetary Union;
"exempt company" means a company satisfying the conditions laid down in subarticle (2) of article 211;
"expert", except where otherwise specifically defined in this Act, means an auditor whether or not assisted by a specialist valuer;
"extraordinary resolution" has the meaning given to it by article 135;
"financial holding company" shall mean a company the sole purpose of which is to acquire holdings in other undertakings, and to manage such holdings and turn them to profits, without involving itself directly or indirectly in the management of those undertakings, and this without prejudice to its rights as shareholder;
"group company", in relation to any company, means any body corporate which is that company’s subsidiary or parent company, or a subsidiary of that company’s parent company, and the term "group" shall be construed accordingly;
"home Member State" in relation to a prospectus means: - (i)
- for all Community issuers of securities which are not mentioned in paragraph (ii) hereof, the Member State where the issuer has its registered office;
- (ii)
- for any issues of non-equity securities whose denomination per unit amounts to at least one thousand and one euro and sixty-three cents ( 1,001.63 ), and for any issues of non-equity securities giving the right to acquire any transferable securities or to receive a cash amount, as a consequence of their being converted or the rights conferred by them being exercised, provided that the issuer of the non-equity securities is not the issuer of the underlying securities or an entity belonging to the group of the latter issuer,
Cap. 345.
the Member State where the issuer has its registered office, or where the securities were offered to the public, at the choice of the issuer or the offeror, as the case may be. The same regime shall be applicable to non-equity securities in a currency other than the euro, provided that the value of such minimum denomination is nearly equivalent to one thousand and one euro and sixty-three cents (1,001.63);
(iii) for all issuers of securities incorporated in a third country, which are not mentioned in paragraph (ii) hereof, the Member State where the securities are intended to be offered to the public for the first time after the date of entry into force of this provision, subject to a subsequent election by issuers incorporated in a third country if the home Member State was not determined by their choice;
"host Member State" in relation to a prospectus means the State where an offer to the public is made, when different from the home Member State;
"individual accounts" means the accounts required by article 167;
"investment company with fixed share capital" means a public company falling within the terms of article 194;
"investment company with variable share capital" means a company falling within the terms of article 84;
"issuer" means an entity having a legal personality distinct from that of its members which issues or proposes to issue securities;
"Maltese regulated market" means a regulated market duly authorised by the competent authority in accordance with article 4 of the Financial Markets Act;
"member", except where otherwise specifically defined, means a shareholder of a company and a partner in any other commercial partnership;
"Member State" means a member state of the European Community;
"Minister" means, unless otherwise stated, the Minister responsible for the registration of commercial partnerships;
"money market instruments" means those classes of instruments which are normally dealt in on the money market, such as treasury bills, certificates of deposit and commercial papers and excluding instruments of payment;
"name" in relation to an individual means that individual’s first name or names and surname;
"notice" shall mean a notice in writing of any kind;
"offering programme" means a plan which would permit the issuance of non-equity securities, including warrants in any form, having a similar type and, or class, in a continuous or repeated manner during a specified issuing period;
"officer" in relation to a company, includes a director, manager or company secretary, but does not include an auditor;
"the Ordinance" means the Commercial Partnerships Ordinance*; Cap. 168.
"ordinary resolution" has the meaning given to it by article 135;
"oversea company" means a body corporate constituted or incorporated outside Malta;
"participating interest" shall mean rights in the capital of other undertakings, whether or not represented by certificates, which, by creating a durable link with those undertakings, are intended to contribute to those undertakings’ activities. The holding of twenty per cent of the capital of another undertaking shall be presumed to constitute a participating interest unless the contrary is shown. An interest in shares includes an interest which is convertible into an interest in shares and an option to acquire an interest in shares. Interests in shares held by subsidiary undertakings or held by third parties on behalf of the company or its subsidiary undertakings shall be deemed to be held by the company;
"person making an offer", or "offeror", means a legal entity or individual which offers securities to the public;
"prescribed" means prescribed by regulations made or deemed to have been made under this Act, and where no regulation is in force in respect of a matter which may or is to be prescribed, means determined, approved or allowed by the Minister;
"principal office" means, in relation to an undertaking not having a registered office, the office which, for the purposes of that undertaking serves the same or a similar purpose as the registered office of a commercial partnership under this Act;
"private company" means a private company as defined in article 209;
"prospectus" means any prospectus, notice, circular, advertisement or other invitation, offering to the public for subscription any shares or debentures of a company or other commercial partnership;
"the Prospectus Directive" means Directive 2003/71/EC of the European Parliament and of the Council of 4 November, 2003 on the prospectus to be published when securities are offered to the public or admitted to trading and amending Directive 2001/34/EC, as may be amended from time to time and includes any implementing measures that have been issued or may be issued thereunder;
"public company" means a company which is not a private company;
"Registrar" means the person appointed by the Minister pursuant to article 400;
*Repealed by this Act.
Cap. 345.
"regulated market" means a regulated market as defined in the Financial Markets Act and includes a Maltese regulated market;
"regulatory authority" means a body or bodies designated by a Member State other than Malta or an EEA State to carry out duties provided for in the Prospectus Directive;
"resident", for the purposes of this Act, means - (a)
- any natural person regardless of nationality who is ordinarily resident in Malta;
- (b)
- any body corporate established under the law of Malta;
"security" includes a share, debenture or any other similar instrument issued by a company or other commercial partnership:
Provided that for the purpose of subarticle (3) of this article and of Chapter III of Part V and Part A of the Second Schedule of this Act, the definition of "security" does not include money market instruments having a maturity of less than twelve months;
"securities issued in a continuous or repeated manner" means issues on an ‘as required’ basis (on tap) or at least two separate issues of securities of a similar type and, or class over a period of twelve months;
"share" includes stock except where a distinction between stock and shares is expressed or implied;
"shareholder" means a person entered in the register of members of a company pursuant to article 123 or the bona fide holder of a share warrant referred to in article 121;
"small and medium-sized enterprises" or "SMEs" means companies which, according to their last annual or consolidated accounts, meet at least two of the following three criteria: an average number of employees, during the financial year, of less than 250, a total balance sheet not exceeding forty-three million euro (43,000,000) and an annual net turnover not exceeding fifty million euro (50,000,000);
"true and fair view" refers - - (a)
- in the case of individual accounts, to the requirements of article 167, and
- (b)
- in the case of consolidated accounts, to the requirements of article 171;
"undertaking" means a body corporate or unincorporate which carries on a trade or business.
(2) (a) For the purposes of this Act "parent company" is a company which - - (i)
- has a majority of the members’ voting rights in another undertaking (a subsidiary undertaking); or
- (ii)
- has the right to appoint or remove a majority of the members of the board of directors or persons entrusted with the administration of another
undertaking (a subsidiary undertaking) and is at the same time a member of that undertaking; or
(iii) has the right to exercise a dominant influence over an undertaking (a subsidiary undertaking) of which it is a member, pursuant to a contract entered into with that undertaking or to a provision in that undertaking’s memorandum or articles of association; or - (iv)
- is a member of an undertaking and controls alone, pursuant to an agreement with other members of that undertaking (a subsidiary undertaking), a majority of members’ voting rights in that undertaking; or
- (v)
- holds a participating interest in another undertaking and actually exercises a dominant influence over that undertaking (a subsidiary undertaking) or it manages the subsidiary undertaking on a unified basis together with it;
and "parent undertaking" shall be construed accordingly. -