Capital Market Regulations in Malta

Malta has started developing as a financial center during the last few years thanks to its good reputation among foreign investors. Considering the investment funds industry has risen quite a lot in the last period of time, the Malta Financial Services Supervisory Authority has considered it the right time to perfect the conditions under which local and foreign companies can list their shares on the Stock Exchange here. The small country has a well-established regulatory framework under which capital markets function.

Our Maltese lawyers can offer detailed information about the legislation covering capital markets.

Capital markets in Malta

Both local and foreign companies have the possibility of listing their shares on primary and secondary capital markets in Malta. These companies can use Malta Stock Exchange (MSE) as a main platform to issue their shares and place them on the capital markets recognized by the MSE. Before listing on any of the primary or secondary capital markets, a company must file an application first with the MFSA and then with the MSE. The application is also known as an Initial Public Offering (IPO).

Companies submitting IPOs with the MFSA and the MSE are required to fulfill certain conditions before being allowed to trade their financial instruments on the local capital markets. Shares, securities, dividends and debentures are among the financial instruments accepted on the Maltese capital markets.

Listing a company on the Malta Stock Exchange

In order to gain access to the primary or secondary capital markets, a Maltese company must obtain approval from the MFSA and then make its IPO to the MSE. The following requirements must be met prior to the listing:

• -          the financial instruments to be traded must be free for transfer;
• -          the application will only refer to the financial instruments sought to be listed.

The company must also appoint a sponsor who will have a Category II License, as provided by the Malta Investment Services Act. Also, the public offer when submitting the prospectus with the MFSA must be of at least 100,000 euros per investor.

For complete information about submitting IPOs for approval, do not hesitate to contact our lawyers in Malta.