Shipping and Aviation Cell Companies in Malta: A Unique Structure with Tax and Asset Protection Benefits
Since June 2020 Malta’s legal framework has offered a distinctive structure for shipping and aviation companies known as the Cell Company (“CC”). This model allows businesses to create multiple distinct 'cells' within a single legal entity, ensuring the segregation of assets and liabilities.
The Cell Company structure provides a unique advantage for businesses seeking to isolate risks, protect assets, and benefit from Malta’s tax imputation system, all while maintaining a streamlined operational structure.
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Key Features of Cell Companies
1. Structure and Operation Each cell within a Cell Company operates as a separate financial unit, with its own distinct assets and liabilities. Despite this, the company remains a single legal entity. The CC has one board of directors that governs the entire company, and the same Memorandum and Articles (“M&A”) apply to all cells, simplifying governance.
2. Compliance and Reporting A Cell Company requires only one operational license and must comply with the Companies Act (Register of Beneficial Owners) Regulations. Additionally, the CC must inform third parties that they are transacting with a Cell Company, specifying which cell the transaction pertains to, ensuring transparency, and
3. Accounting To function effectively, a Cell Company must maintain clear and separate accounting records for each cell’s assets and liabilities. Although the cells do not have independent legal personalities, directors are responsible for ensuring that cellular and non-cellular assets are properly segregated in the company’s accounting records.
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Formation of a Cell Company
A company can be formed as a Cell Company from the outset, or an existing company can be converted provided that the company’s activities align with those outlined in Article 84E of the Companies Act. Additionally, the company’s M&A must reflect that it is a Cell Company, and the name must include the suffix Mobile Assets Protected Cell Company (“MAPCC”) to distinguish it under Maltese law.
Each cell within the Cell Company must be allocated a unique name, and registration with the Malta Business Registry (“MBR”) is required for each cell. There are also fees associated with the creation and registration of each cell, as per the Companies Act (Fees) Regulations.
For companies converting to a Cell Company structure, assets must be attributed to specific cells within 40 days of conversion by director’s resolution. Within 14 days of this resolution, a notice detailing the assets attributed to each cell must be submitted to the MBR. This ensures that each cell’s assets are clearly defined and legally isolated.
If you are considering adopting a Cell Company structure in Malta, it is essential to seek expert legal and financial advice to ensure full compliance and optimise the benefits available.
For further insights into the regulatory landscape and asset management strategies, feel free to contact us.
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