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Regulating Corporate Services Providers in Malta

MEDIA ROOM

January 23, 2014

On the 24th December 2013, Chapter 529 of the Laws of Malta was promulgated, comprising the new Company Service Providers Act. This Act aims to regulate corporate services providers with a view to strengthen the industry’s arsenal against abuse of the financial system for the purposes of money laundering and terrorist financing.

“Company Service Providers” are effectively natural or legal persons resident or operating in or from Malta who, by way of business, provide any of the following services:

  1. formation of companiesor other legal entities;
    b. acting or arranging for another person to act as director or company secretary of a company (or similar position for other legal entities);
    c. providing of registered office, business correspondence address, administrative address and other related services for a company or other legal entity.

These previously unregulated service providers must now apply for registration with the Malta Financial Services Authority by the 24thMarch 2014. It is noteworthy, however, that those persons in possession of a warrant to act as advocate, notary, legal procurator or chartered public accountant are exempt from this formality. No doubt the rationale for this exemption is based on the considerable accountability already placed on the holders of such warrants by their respective governing bodies. Persons who are authorised to act as a trustee are similarly exempt from registering with the MFSA, based on the reasoning that these service providers are already subject to PML rules on the basis of their professional activities. Such exempt persons are however still required to notify the Financial Intelligence Analysis Unit (FIAU) that they are acting as a company service provider by way of business.

The Application for Registration to Act as a Company Service Provider must be submitted to the MFSA by the 24th March 2014. The IFSP has also issued draft Rules for Company Service Providers which are due to come into force within the coming weeks.