Most founders considering Malta think they face two choices. Keep the foreign company where it is and accept its tax and regulatory position, or wind it up and incorporate a new company in Malta. Both have real costs, and both miss a third option that has existed in Maltese law since 2002.
A company can move to Malta without being liquidated. It keeps its name, its contracts, its bank relationships and its trading history, and continues as a Maltese company from the day the Registrar says so. The mechanism is called continuation, or redomiciliation, and it is used far less often than it deserves to be.
Key Takeaways
- Your company moves, it does not restart. Continuation keeps the same legal person, so contracts, assets, banking relationships and trading history survive the move intact. Nothing is transferred, because the owner never changes.
- Eligibility is decided by your current jurisdiction, not by Malta. The law where the company is registered must permit continuation elsewhere, and its own constitutive documents must allow it. Check those two points before anything else.
- The move can reset your tax base cost. On redomiciling, a company may revalue assets held outside Malta from historic cost to market value, which affects capital allowances and any future gain on disposal. It is optional, and frequently the most valuable part of the exercise.
What Continuation Actually Means
Redomiciliation is governed by the Continuation of Companies Regulations, introduced under the Companies Act by Legal Notice 344 of 2002 and amended by Legal Notice 352 of 2003 and Legal Notices 181 and 186 of 2006. The regulations came into force on 26 November 2002 and work in both directions, allowing foreign companies to continue in Malta and Maltese companies to continue elsewhere.
The legal effect is the point. Continuation ensures the continued existence of the same legal person. Nothing is dissolved, nothing is created. The company that existed in Cyprus, the British Virgin Islands or the United Kingdom on Monday is the same company, now Maltese, on Tuesday. Its assets remain its assets. Its contracts remain in force. Its counterparties deal with the same entity they always did.
Continuation is also a practical alternative to a cross-border merger, particularly where the other jurisdiction sits outside the European Union and the merger route is unavailable or unwieldy.
Why Liquidating and Starting Again Costs More Than It Looks?
The instinct is to incorporate a new Maltese company and move the business into it. On paper it looks simpler. In practice it is usually the more expensive route, for three reasons.
Assets and liabilities have to move. Winding up the old company and reconstituting in Malta means transferring everything the business owns and owes from one legal person to another, and that transfer can trigger tax consequences in the originating jurisdiction, in Malta, or both. Continuation avoids the transfer entirely because there is nothing to transfer. The owner has not changed.
Contracts do not follow automatically. Supplier agreements, customer contracts, leases, licences and financing arrangements are held by a specific legal entity. Replace that entity and each one needs assignment or renegotiation, with every counterparty holding a veto they did not have before.
Trading history disappears. Years of accounts, credit standing and banking relationships attach to the company that built them. A newly incorporated Maltese company starts with none of it, which matters most precisely where it hurts most, at the bank.
Which Companies Qualify
Not every foreign company can be continued in Malta. Five conditions apply, and all of them must be met.
- The entity must be a body corporate similar in nature to a company as known under Maltese law.
- It must be incorporated in an approved country or jurisdiction, a category covering EU and EEA countries and OECD member states.
- The law of that jurisdiction must permit continuation in another country. This is the condition that stops most enquiries, and it is the first thing to check.
- Its constitutive documents must expressly authorise it to be continued elsewhere. Where they are silent, they can usually be amended first, which is a step to plan for rather than discover.
- It must have been registered for at least one year in a jurisdiction not blacklisted by the Financial Action Task Force.
What the Registrar Wants to See?
The request goes to the Registrar of Companies on a prescribed form, and the supporting file is substantial.
- An extraordinary resolution of the company authorising it to be registered as continued in Malta
- The company’s statute, revised as necessary to meet the requirements for registering a company under the Companies Act
- A certificate of good standing from the competent authority in the foreign jurisdiction, or equivalent evidence that the company complies with local registration requirements
- A declaration signed by at least two directors confirming the company’s name and the name under which it proposes to continue, that formal notice of the intention to continue in Malta has been given to the foreign authority, with evidence annexed, and that no proceedings for breach of local law have been commenced against it
- A separate declaration signed by at least two directors confirming the company’s solvency
- A list of the directors and the company secretary, or of the persons vested with administration or representation
- A list of current shareholders, authenticated, and dated close to the submission date
- Legal opinions from counsel in the foreign jurisdiction, confirming among other things that the entity is a body corporate, that its governing law permits continuation, that creditors have been notified of the decision, and that any consents required from them have been obtained
- A certified English translation of any document not in English
Two additional consents apply in specific cases. A company quoted on a recognised stock exchange must produce the exchange’s consent to the continuation. A company carrying on a licensed activity must produce the consent of the authority that licensed it.
The Two Certificates, and the Six Month Clock
This is the part that surprises people, and it is worth understanding before starting.
Once the Registrar is satisfied, the company receives a Provisional Certificate of Continuation. From that date it is deemed validly registered as a Malta company for all purposes of law, subject to all the obligations and capable of exercising all the powers of a Maltese company. The date on the provisional certificate is treated as its date of registration under the Companies Act.
Then the clock starts. Within six months of the provisional certificate, the company must submit documentary evidence to the Registrar that it has ceased to be registered in the foreign jurisdiction. Miss that deadline and the Registrar may strike the company off the register, though where reasonable cause is shown a further three months may be allowed.
Once the evidence arrives, the Registrar issues the Final Certificate of Continuation and the process is complete. The practical lesson is that redomiciliation is not finished when the Maltese paperwork is accepted. It is finished when the originating jurisdiction has let go, and that half of the process runs on someone else’s calendar.
What Changes on the Tax Side?
Once the final certificate is issued, the company is treated as ordinarily resident and domiciled in Malta. It is taxed on its worldwide income at the standard 35%, exactly like a company incorporated locally, and its shareholders access the same refund mechanism, which brings the effective rate on trading income to 5%.
There is a second consequence that receives far less attention and is often worth more than it appears. On redomiciling to Malta, a company is entitled, though not obliged, to claim a step-up in the tax base cost of assets situated outside Malta. It may elect to revalue those assets from historic cost to fair market value at the date it becomes domiciled or resident in Malta, without adverse Maltese tax consequences.
That revaluation carries forward. It affects the calculation of tax-deductible capital allowances, and it sets the base cost against which any future gain on disposal is measured. For a company holding appreciated assets, this is frequently the single most valuable feature of the move, and it is available on continuation in a way it is not available to a business that simply sold its assets into a new Maltese company.
The Licensing Trap
One point deserves flagging early because it can change the entire timetable.
Where a foreign company carries on an activity that is not licensable in its home jurisdiction but would be licensable if carried out in or from Malta, that company will require a licence or authorisation from the competent Maltese authority. Financial services, investment activity, insurance and gaming all fall into this category.
The consequence is straightforward. A continuation that looked like a corporate filing becomes a corporate filing plus a regulatory application, and the regulatory application sets the pace. This is worth establishing at the outset rather than discovering after the provisional certificate has been issued and the six month clock has started running.
When Continuation Is the Wrong Route?
Redomiciliation is not always available, and it is not always the best answer.
It is unavailable where the originating jurisdiction does not permit companies to continue elsewhere, where the company has been registered for less than a year, where the jurisdiction is FATF blacklisted, or where the constitutive documents do not allow it and cannot practically be amended.
It is the wrong choice where the objective is not to move the company but to establish a presence alongside it, in which case a branch or a Maltese subsidiary does the job with far less disruption. And for a group consolidating entities across several member states, a cross-border merger or a European Company may serve the structure better than moving one entity at a time.
Where it does fit, though, continuation delivers something no other route can. The same company, with the same history and the same contracts, operating from inside the European Union.
We handle the continuation filing, the supporting resolutions, the revised statute and the coordination with the outgoing registry from start to finish. If you are weighing a move, tell us where the company is registered and what it does, and we will tell you whether continuation is open to you.