Malta Custodian Services

Investment Service Providers

Malta Custodian Services


Malta is positioned as an innovative, reliable and flexible EU financial services centre, hosting and attracting a variety of financial services businesses and structures. Over the last two decades, Malta’s fund industry has undergone significant growth, which has in turn led to the development of highly specialized custody and depository services.


The industry in Malta has bloomed, and the number of licensed custodians with the Malta FSA is on the increase with applications from both local and international
custodians. Whilst custodians established outside Malta, may easily re-domicile to Malta, custodians in Malta are able to delegate functions to custodians established outside of Malta. Malta custodians benefit from Malta’s full imputation system, resulting in a 5% net effective tax rate as well as highly competitive set-up, and operations costs; resulting in 20 to 30% less than in other European business hubs.






Country Highlights

TIMEZONE: Central European Time Zone  (UTC+01:00)   SIZE OF INDUSTRY: 25% Annual Growth 
EU: Member of the EU and Eurozone         FINANCIAL SERVICES FRAMEWORK: EU and OECD Approved
GDP GROWTH: 5% in 2016 (NSO)           REGULATOR: Malta Financial Services Authority (MFSA)
BANKING SYSTEM: 10th Soundest in the World TAX REGIME: EU & OECD compliant


Legal Basis

The Investment Services Act, 1994 is the main legislative framework for the regulation and supervision of custodians and depositaries providing custody services to collective investment schemes. The law and regulations provide for two types of licences covering fully-fledged custodians and depositary services. Custodians servicing any type of collective investment scheme shall require a Category 4a Investment Services Licence whilst depositaries (depositary lite) require a Category 4b Investment Services Licence - the latter are able to act as depositaries of Alternative Investment Funds (AIF) under the conditions set out in Article 21(3) last paragraph of the AIFMD (Directive 2011/61/EU) or which are subject to the so called ‘depositary lite’ regime under Article 36 of the AIFMD.
 


Benefits

  • Foreign custodians can establish branches in Malta
  • Foreign Custodians can re-domicile to Malta
  • Malta custodians may delegate functions to third parties established outside of Malta
  • Full imputation tax system, 5% Effective tax rate
  • Cost effective set-up & ongoing costs


Eligibility

Key Requirements

  • Category 4 Licence;
  • Minimum capital of €125,000;
  • Application fee of €4,000 is payable to the MFSA upon submission of the draft application, and €10,000 upon obtaining the licence
  • Established place of business in Malta, be it shared or fully owned by the custodian;
  • The business formation must be made up of three board members, one of which must be based in Malta;
  • Must have a Compliance officer and a Money Laundering Reporting Officer (MLRO)


Process & Timeline




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Reference Materials

Key Contacts

Dr Maria Chetcuti Cauchi

Senior Partner

+356 22056412

Mr Nicholas Warren

Senior Manager, Financial Services

+356 22056415

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