The Malta Financial Services Authority (MFSA) has launched a public consultation proposing a more flexible approach to the free float requirement for companies seeking admission to trading on a regulated market in Malta. The proposals aim to align with the EU Listing Act and make the local capital market more attractive, particularly for SMEs.
In simple terms, free float refers to the portion of a company’s shares that are held by public investors, i.e. not by founders, insiders, or major shareholders
Under current local rules, a company must ensure at least 25% of its shares are held by public investors in order to be admitted to trading. The MFSA now proposes to adopt a more flexible, tiered framework that lowers this threshold (in certain cases) while still safeguarding investor protection and liquidity.
New Proposed Thresholds
10% – 14% free float, if:
- at least 200 investors hold shares (directly or via intermediaries); and
- the company has a minimum market capitalisation of €100 million at listing.
15% – 24% free float, if:
- at least 200 investors hold shares (directly or via intermediaries); and
- the company has a minimum market capitalisation of €50 million at listing.
Where these conditions are not met, the existing 25% free float requirement will continue to apply.
These changes reflect similar reforms introduced at the EU level via the Listing Directive (EU) 2024/2811, which must be transposed into Maltese law by 5 June 2026.
To implement these proposals, the MFSA intends to:
- amend certain Capital Market Rules; and
- transfer oversight responsibilities to the regulated market, rather than the MFSA itself.
This proposal could mark a significant turning point for Malta’s IPO landscape. By easing the free float threshold under specific safeguards, the MFSA is encouraging more private companies, particularly high-growth SMEs, to consider going public without sacrificing majority control. If adopted, the reforms could boost primary listings, investor participation, and market depth.
Stakeholders are invited to submit their feedback by 16 July 2025 to capitalmarkets@mfsa.mt.
