If you intend to conclude a merger transaction in Malta, you should pay special attention to the procedure for verification and approval of such transactions by government authorities. This will help to avoid serious fines that can reach up to 10% of the company's turnover. You can learn more about this by signing up for a personal consultation with our experts.
Obtaining permission to conduct an M&A deal in Malta
Typically, a merger reorganization is carried out for the purpose of consolidating the assets and liabilities of several companies. Or the transformation of disparate enterprises into a single holding company.
The rule is simple - a planned M&A transaction must be notified in advance to the main regulator on these issues - the Competition Department. In this case, the notification must be made before and after the conclusion of the merger agreement in Malta, the announcement of a public application or the acquisition of a controlling stake. If such information is not provided to the regulator on time, then you face a fine that can reach 10,000 euros.
The notice is sent in writing by the person acquiring control of the company (or officially representing the legal entity acquiring control). If we are talking about joint control, then the regulator expects notification from representatives of all parties.
Terms of consideration of the application
After you provide the regulator with the notification, you will have to wait about 2 months. This time is required by the regulator in order to carry out the necessary verification of the compliance of your application with the concentration control regulations.
If the stated concentration does not raise serious doubts from the point of view of anti monopoly legislation, then the regulator's decision will not be long in coming. It is also possible to go through all the stages of verification under a simplified procedure if it becomes clear to the regulator that the M&A deal in Malta will not lead to a decrease in competition.
The simplified procedure applies, in particular, when:
- Acquired joint control over a joint venture that operates outside Malta;
- M&A is carried out in Malta, but the parties operate in different markets;
- As a result of the merger, the total market share of the firm is less than 15%.
Regulation of public takeovers in Malta
A bidder acquiring a Malta business or part of it must submit a specific form of concentration notice. This form includes information about:
- the parties to the transaction;
- the nature of the transaction;
- economic and financial scheme;
- the structure of ownership and control;
- global and local trade;
- analysis of the structure of supply and demand and a number of others.
If the absorbed company has a tax debt, its authorized representatives must provide the tax authority with a plan for reorganizing the debt. After submitting this document, the legal entity may be offered an adjusted takeover plan. Avoiding surprises in the company's financial position will be helped by performing an audit of the merging enterprises and a detailed study of the audit reports.
If you have any questions regarding the regulation of mergers and acquisitions in Malta, please contact us for the necessary consulting services. IQ Decision UK specialists are also ready to provide relevant assistance in conducting an M&A transaction in Malta. You can find out more about our services by filling out a special form below.