A proposal on facilitating registration of cross-border single-member companies in the EU, currently being discussed in the European Parliament, was the subject of an exchange of views between stakeholders held at Dar l-Ewropa this morning.
The proposed Single-Member Private Limited Liability Company directive asks member states to provide for, in their national legislation, a national company law registration form that would be harmonised across the EU. The purpose of the proposed directive is to make it easier for any potential business to set-up single-member private limited liability companies across the EU. It provides a standard template for the articles of association as well as the possibility to register such companies electronically, without the need of a physical presence of the founder before the authorities of the Member State of registration.
Speakers included Maltese MEPs Therese Comodini Cachia (EPP) and Marlene Mizzi (S&D), who are both directly involved in the ongoing legislative process of the proposal.
MEP Mizzi is the Rapporteur on the subject within the Internal Market and Consumer Affairs Committee, which is asked to give its opinion as part of the process. In her report she tabled over a hundred amendments wherein the main objective is to include safeguards to ensure that businesses operate cross-border for the right reasons. She said this possibility should not be available to all companies irrespective of size. The main concerns are linked to fiscal evasion, corporate governance standards, and forum shopping.
On the possiblity of online registration, she said there should be sufficient inbuilt security measures along the process. The same applies to dual seats, which, she said, could lead to abuse of employees and creditors through so-called “letterbox companies”. Mizzi reiterated what she had stated in he report: “Overall, the initiative is positive but the mechanism chosen is not necessarily the best one. We do not want to create yet another regime over and above national legislation”.
MEP Comodini Cachia is a member of the Legal Affairs Committee, which is the lead committee ultimately responsible for the dossier. She said this discussion comes in time for the input of stakeholders to be channelled into the legislative process. She said that in the initial discussions held there was a divergence of views between the main political groups.
Most requirements being presented in the proposal are already catered for in Maltese company law, she said. “A good reputation has been established locally as far as the incorporation of companies is concerned”, she said. The view of the EPP group is to back any initiative that would facilitate cross-border business and reduce the bureaucratic burdens small companies face.
Mr Joe Caruana, Registrar of Companies within the Malta Financial Services Authority, explained that online registration of a company is already possible in Malta. He said that only last year around 5,000 companies were registered in Malta, 70% of which by non-Maltese residents.
The event was also addressed by Omar Cutajar and Mark Seychell from the MBB. Other participants included legal practitioners, the Malta Institute of Accountants, the Notarial Council, and the Malta Chamber of Commerce, Enterprise and Industry.
The event was held jointly between the European Parliament Office in Malta and the Malta Business Bureau, in partnership with Enterprise Europe Network.
