Malta Financial Services License
Advantages of a Maltese Investment Services License
1. Investor Protection
It is illegal for any person to provide an investment service in or from Malta unless such person is in possession of a valid investment services license.
The power of granting investment services license is the responsibility of the MFSA. The MFSA is in charge of granting an Investment Services license, and may subject the Investment Services License Holder to such conditions, as it may deem appropriate. The conditions which MFSA generally imposes upon an investment services License Holder are reasonable standards of competence, integrity and fair dealing.
2. Low Taxation
Maltese Investment Services License Holders, whose activities are limited to services from Malta but not in Malta (i.e. not advising Maltese individuals) could benefit from Malta’s Imputations System wherein they are subject to a corporate tax of 35%. In addition, non-resident shareholders would then benefit from a very attractive tax refund ending up in a final rate of taxation of 5%.
3. Professional Services
Malta has considerably lower costs in the provision of these services, reduced unnecessary bureaucracy and maintenance of high standards and efficiency.
4. Low Set-up and operational Costs
The costs of obtaining an investment license in Malta and setting up of the corresponding corporate vehicle as well as the running expenses of the Company are reasonable and relatively lower than the same costs in other financial centres in Europe.
5. EU Passporting
A Malta Licensed Investment Services Company is able to operate in any other country member of the European Union either directly or through the establishment of a branch. This is especially attractive for non-EU Investment Service providers who wish to expand their operations in the EU.
- Dealing as Principal or Agent
- Buying, selling, subscribing for or underwriting instruments as principal or agent.
- Arranging Deals
- Arranging for another person to buy, sell, subscribe for or underwrite instruments.
- Management of Investments
- Managing or agreeing to manage assets belonging to another person if those assets consist of or include one or more instruments or the arrangements for their management are such that the person managing or agreeing to manage those assets has a discretion to invest any of those assets in one or more instruments.
- Acting as trustee, custodian or nominee holder of an instrument, or of the assets represented by or otherwise connected with an instrument, where the person acting as trustee, custodian or nominee holder is so doing as part of his providing any investment service; Or
- Holding an instrument or the assets represented by or otherwise connected with an instrument as nominee, where the person acting as nominee is so doing on behalf of another person who is providing any investment service or on behalf of a client of such person, and such nominee holding is carried out in relation to such investment service; or acting as trustee or custodian in relation to a collective investment scheme.
Categories of Financial Service License
Category 1 Financial Service License
Authorisation to provide any investment service but not to hold or control clients’ money or assets nor to deal for their own account or to underwrite.
Category 2 Financial Service License
Authorisation to provide any investment service and to hold or control clients’ money or assets, but not to deal for their own account or to underwrite.
Category 3 Financial Service License
Authorisation to provide any investment service, to hold and control clients’ money or assets, and to deal for their own account and to underwrite.
Category 4 Financial Service License
Authorisation to act as custodians of collective investment schemes.
The Application Process
The application process to form a company in Malta is fairly straight forward. The process usually commences with a formal meeting with the MFSA in order to discuss the projected application before the formal submission of the application documents. The Application process and the ongoing requirements to which licences issued under the ISA are subject to, can be divided into the following three stages
The Preparatory Stage – including a meeting with the Authority, submission of a draft applicationform & supporting documentation, review by the MFSA, delineation of the Standard License Conditions to be applied to that particular Applicant by the Authority.
The Pre-Licensing Stage – issuance of an ‘in principle’ approval for the license by the Authority, incorporation of the corporate vehicle, submission of final & signed application form & supporting documentation, other documents arising during the application process.
The Post-Licensing/Pre-Commencement of Business Stage – satisfaction of ad hoc requirements arising post licensing but pre-commencement of business.
The content on this website is for information purposes only and should not be taken as tax, legal or any other professional advice.
Contact our CBDO on LinkedIn Deborah Vella or email us on [email protected] for more information as well as for a quote. We will happily guide you through the gaming License application process and also advise you on the solutions that would best suite your needs!