Key amendments to the Companies Act

More than a year after its publication, where do matters stand with the implementation of the Companies (Amendment) Act 2025?

This legislation is still being brought into force in stages. Act XVIII of 2025, also known as the Companies (Amendment) Act 2025 (the “Act”), was published in the Government Gazette on the 11^th of July 2025. The first provisions took effect on the 7^th of August 2025 through Legal Notice 174 of 2025, followed by further provisions in December, 2025 through Legal Notice 286 of 2025.

Certain amendments have yet to come into force. The Act introduces a number of changes to the Companies Act, including revisions to company classifications, compliance obligations and the use of electronic communications, with the aim of making corporate administration more straightforward.

‍‍

Change in term: ‘Private Exempt Companies’

One of the most significant amendments introduced by the Act is the removal of the term ‘exempt company’. This amendment is purely a change in terminology, meaning that the conditions and benefits previously applicable to private exempt companies under Article 211 of the Companies Act remain fully intact. These include, among others, the ability of such companies to grant loans to individuals acting as their directors. Following the amendment, entities previously referred to as ‘private exempt companies’ must now be described as ‘private companies in terms of Article 211’.‍

‍

Importance given to the registered email address

To ensure consistent and effective communication between companies and the Malta Business Registry (the “MBR”), the Act reinforces the obligation on company officers to actively monitor the company’s registered email address. This duty reflects the legislator’s intention to elevate what was previously considered best practice into a statutory requirement. In addition, the Act requires that any change to a company’s electronic mail address be notified to the MBR. The Act expressly places responsibility on company officers to ensure the address is kept up to date and properly monitored to avoid breaches of statutory duties. Such updates may be affected online through the existing MBR electronic filing system within 14 days of the change.

‍

Non-cash consideration & the €50,000 threshold

The Act introduces an important amendment to Article 73 of the Companies Act, which previously required an independent expert’s report for any allotment of shares made in exchange for non‑cash consideration, irrespective of the value involved. Following the amendment, a director’s declaration may now replace the independent expert’s report where the value of the non‑cash consideration does not exceed €50,000. Although this change significantly simplifies and reduces the cost of lower‑value transactions, no formal template has yet been issued for the director’s declaration, which may create an element of uncertainty. Nonetheless, the declaration must mirror the content that would otherwise be expected in an expert’s report and must be filed with the MBR prior to the allotment or issue of the shares. The overall purpose of this amendment is to streamline procedures and reduce administrative and financial burdens for lower‑value share allotments.

‍

Rights of usufructuary of shares

Article 117A has been introduced into the Companies Act, clarifying the rights of usufructuaries over shares. Under this provision, a usufructuary of shares is expressly entitled to attend any general meeting of the company and to receive dividends derived from those shares. However, the default position is that voting rights may only be granted where such entitlement is specifically provided for either in the public deed establishing the usufruct or in the company’s Memorandum and Articles of Association.

‍

Pledges over shares

Stricter filing requirements have also been added to Article 122 of the Companies Act, in relation to the pledge of shares. In addition to submitting Form T(2) as the formal notice of a pledge, detailing the pledgor, the pledgee, and the securities involved, the amended provision now requires that a document outlining the contract from which the pledge originates, such as the pledge agreement itself or an equivalent instrument, must also be filed with the MBR. Both the statutory notice and the contractual document must be delivered to the Registrar within fourteen days of the granting of the pledge, by either party. This amendment strengthens transparency and ensures that the MBR maintains a complete record of the underlying security arrangements, thereby enhancing legal certainty for lenders, pledgors, and practitioners.

‍

Amendments to partnership regulations

The Act, through amendments to Articles 19 and 21 of the Companies Act, introduces important updates to partnership regulations. These amendments aim to streamline and modernise the way partnerships record and formalise partner contributions. In terms of Article 19, any increase in partner contributions, or contributions made by a new partner, now takes effect immediately upon receipt by the partnership, without requiring an amendment to the partnership deed. Partners responsible for the administration or representation of the partnership must then notify the MBR within three months after the end of the calendar year in which the contribution was made, by submitting a resolution confirming that the contribution has been received. Furthermore, where an increase in contributions occurs in the same year as an intended assignment of partnership interests, confirmation of the increased contributions must be filed with the MBR prior to the assignment. These amendments aim to steamline the process of recognising new or increased partner contributions.

With respect to partnerships en commandite, the amendments now require that notices of changes in partners be filed only in relation to general partners with unlimited liability, meaning that changes involving limited partners no longer trigger a statutory filing requirement.

‍

Simplified dissolution procedure

A new simplified voluntary dissolution procedure has been introduced through Article 214A of the Companies Act, enacted by Act XVIII of 2025 and brought into force on the 16^th of December, 2025. This mechanism provides an easier and more cost‑effective means of dissolving dormant or inactive private limited liability companies, allowing them to be struck off without the need for a full liquidation process or even the need to appoint a liquidator.

Nevertheless, in order for a company to take advantage of this new inclusion to the Companies Act, it must satisfy the below criteria:

• The company must have ceased all trading and not entered into contracts (other than with service providers) during the previous six months;
• The company’s assets cannot be valued more than €5,000;
• The company must have no outstanding liabilities (other than minimal officer or service‑provider fees and shareholder loans);
• The company must have no pending court proceedings;
• The company shares must not be pledged;
• The company cannot have any active bank accounts; and
• The company must settle all compliance obligations.

‍

Once the directors of the company submit the required declaration and shareholders’ resolution, the Registrar publishes a notice of the proposed dissolution. If no objections are filed within the statutory notice period, the company is struck off the register, thus avoiding the time, as well as the cost of carrying out a typical liquidation.

As the remaining provisions are gradually brought into force, it remains to be seen whether the practical challenges encountered by companies and practitioners will be addressed through future reforms.