Additional BO obligations introduced

The coming into force of Legal Notice 247 of 2020 has made further amendments to the Companies Act (Register of Beneficial Owners) Regulations, 2017 (the “Regulations”).

Whilst previously, the Regulations imposed no annual filing requirement in relation to beneficial ownership information, the newly introduced Regulation 6A stipulates that  upon  each anniversary from a company’s date of registration, a company shall file a return following the template set out in the First Schedule. This has the objective of disclosing any change in details on beneficial owners, or otherwise to confirm that no change in details took place. The return may be signed by at least one director or the company secretary and shall be delivered to the MBR within forty-two (42) days from the anniversary date. Moreover, any change in the senior managing officials of a company shall be notified to the MBR within fourteen (14) days from the effective date of change.

The failure to adhere with the afore-mentioned obligations renders a company liable to a penalty of €5,000 as well as a daily penalty of €100 until the infringement is rectified.

A new obligation requires a certified true copy of an official document of each beneficial owner to be annexed when submitting any declarations containing information about beneficial owners.

The powers of the Registrar relating to company registrations have been widened by virtue of Regulation 9. In fact, the Registrar is empowered to:

  • Refuse to register any document of a company if the beneficial ownership information has not been submitted, is not accurate or up to date;
  • Restrict new company incorporations wherein the proposed directors are involved in other Maltese companies that failed to submit information on their beneficial owners;
  • take the necessary steps and ask for any information he deems necessary to ascertain the veracity of the beneficial ownership information, prior to registering a company.

The amendments also grant the Registrar the power to carry out on-site inspections with the aim of verifying that the information submitted to the MBR in relation to beneficial ownership was accurate. If the Registrar forms the opinion that the beneficial ownership information needs to be revised, every officer of the company shall be liable to a penalty not exceeding €100,000.

The Regulations also conducted changes to the existing statutory BO1 and BO2 forms which require to be submitted in relation to company incorporations and upon any change in shareholding of a company.

Lastly, the amendments introduced hefty administrative penalties for any breaches of the Regulations.