and UCIs under maltese law
Advice and assistance for setting up investment funds and UCIs under Maltese law
Our law firm offers assistance for setting up UCI’s and investment funds that are very important in planning investment operations and asset management. We offer advice and ongoing legal assistance to those who wish to set up or manage Collective Investment Schemes or Professional Investment Funds. In this regard, the Maltese regulatory framework is very well defined and offers, in addition to a seductive tax regime and low costs, a rapid and simplified bureaucracy. A fund established in Malta that has more than 15% of its assets invested abroad is exempt from both taxation and stamp duty. All this makes Malta an ideal hub for small, medium or large funds.
The MSFA (Malta Financial Services Authority) defines the rules for the establishment of Collective Investment Funds which are divided into 2 types.
- UCITS (“Undertakings for Collective Investments in Transferable Securities”, in Italian OICVM)
They are open-end mutual funds (unit trusts), globally acknowledged as reliable and transparent because, finally, well regulated by the UCITS Directive (the last one is V, 2014/91/EU, which aligns the duties and liabilities of the fund depositaries and the remuneration requirements of fund managers with those of the AIFMD Alternative Investment Funds Directive). They can sell and purchase assets within the European Economic Area following the standardised notification procedure laid out by the UCITS Directive. This type of fund can be self-managed, if set up as a SICAV (open-ended collective investment scheme), or can appoint an administrator in Malta or in another country, if the appointment is approved by the MSFA.
- Non-UCITS, open or closed
These may market assets with the Maltese public without limitation, or with investors outside of Malta, if the authorisations of their country are complied with. These funds can be self-managed or can appoint an external manager, but they must appoint a custodian-depositary who is based in Malta and is licensed under the Maltese Investment Services Act (Chapter 370 of the Laws of Malta, the “Act”)
For professional investors: PIF (“Professional Investor Funds”).
These funds may have the legal form of open-end or closed SICAVs, Private Equity or Venture Capital companies, mutual funds and hedge funds. They are divide into 3 categories based on the investment capacity:
- Experts: they invest at least 10,000 euros
- Qualified: they invest at least 75,000 euros
- Extraordinary: the invest a minimum of 750,000 euros.
It is not mandatory, but it is recommended that at least one of the managers of this type of fund resides in Malta. PIFs for experienced investors must have a custodian independent of the manager, who must act in the interest of investors, while all types of PIF must appoint an auditor approved by the MFSA, a compliance officer and an anti-money laundering communication officer. PIFs can be converted into UCITS based in Malta.
Maltese law allows the continuation of companies inside and outside Malta, which guarantees that the fund maintains the same legal form, the continuity of its history and performance. The MFSA has published guidelines outlining a simple procedure for the continuation of companies in Malta.