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The Maltese Archipelago is composed of five islands. Malta is the largest, followed by Gozo, its sister island. Throughout the centuries, many nations have availed themselves of the strategic, central position of the Maltese islands and their impressive natural harbours in the centre of the Mediterranean.

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New developments
  • Malta has implemented the Third EU Anti-Money Laundering Directive by means of Legal Notice 180 of 2008, which introduced the new Prevention of Money Laundering and Funding of Terrorism Regulations, 2008.
  • In August 2008, Malta signed a new double tax treaty agreement with the USA. The new double tax treaty was signed following the termination of the 1980 Malta-USA double taxation treaty and after several years of negotiations.
  • On 13 March 2009, Malta and Italy signed in Rome a Protocol amending the Agreement for the Avoidance of Double Taxation between the two countries. These amendments include reference to the taxes covered, to the elimination of double taxation and to exchange of information.
  • Following the G20 summit of 2 April 2009, the OECD published the much-anticipated OECD Progress Report; Malta is included in the ‘white list’, confirming that it is regarded as being a jurisdiction that has substantially implemented the internationally agreed tax standard.

1. Introduction

a. History and background

The Maltese Archipelago is composed of five islands. Malta is the largest, followed by Gozo, its sister island. Throughout the centuries, many nations have availed themselves of the strategic, central position of the Maltese islands and their impressive natural harbours in the centre of the Mediterranean.

The history of the Maltese Islands dates back 7,000 years. The Maltese Islands formed part of both the Roman and Byzantine Empires before being subject to Arab and, later, Norman domination. In 1530, the Maltese Islands were ceded by the Holy Roman Emperor Charles V to the Order of St John and in 1798 the Islands were surrendered to Napoleon. French administration ended in 1800, after which Malta was subject to British colonial rule until its independence in 1964. Malta became a Republic in 1974 and in May 2004 became a member of the European Union, adopting the euro (EUR) as its official currency on 1 January 2008.

Today, Malta has become a centre of commerce and investment. Maltese and English are the two official languages. Most business correspondence, commerce and trade is conducted in English, thereby making Malta an attractive location from which to conduct international business and in which to take up residence. When the G20 met on 2 April 2009, Malta had the international requirements in place and therefore was on the white list of jurisdictions.

Despite the present financial crisis, the Maltese market remains stable and no bail outs for banks have been necessary.

A report on regulatory developments in financial services and anti-money laundering in Malta, published by the Bureau for International Narcotics and Law Enforcement Affairs of the US State Department on 1 March 2004, confirms the progress in financial services regulation made over the last ten years, and outlines Malta’s transition from an offshore jurisdiction into a mainstream financial services jurisdiction that is today a member of the EU. 


b. Legal system

Malta has a written Constitution that prevails over any other law and requires two-thirds parliamentary majority to be changed. Although Maltese law is based on the civil law system, it has been strongly influenced by other legal systems, particularly English common law and, more recently, European Union legislation. In fact, although Maltese civil law is largely based on Roman law principles, fiscal law, company law, shipping and maritime law and most fields of commercial law are heavily influenced by English law. Financial services legislation in Malta is principally based on European Union legislation.

Editorial board
Malcolm Becker TEP
Butterfield Trust (Malta) Limited, St Julians, Malta
Tonio Ellul TEP
EMD Advocates, Valletta Waterfront, Malta
Anthony Cremona TEP
Ganado & Associates, Valletta, Malta

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