Changes in beneficial ownership of a company must be reported to the Malta Business Registry (MBR) within fourteen days, as required by Regulation 6(1) of the Companies Act (Register of Beneficial Owners) Regulations. Companies are obligated to submit a BO2 Form, detailing the new beneficial owner, the nature and extent of their ownership, and the effective date of the change. The form must be signed by at least one director or the company secretary and include a certified true copy of the official identification document of each beneficial owner.
When is the BO2 Form Required?
The BO2 Form must be submitted to the MBR in various instances, including:
- Transfer or transmission of shares – If a notice of transfer or transmission of shares is delivered to the MBR under Article 120(3) of the Companies Act, including transfers caused by inheritance.
- Changes in share capital – If the company’s issued share capital increases or decreases.
- Alterations in voting rights or shareholding structure – If any modifications affect control, voting rights, or ownership structure.
Additionally, the BO2 Form must be filed even if there are no changes in registered shareholders but changes in the ultimate beneficial ownership occur. For example, if share transfers take place within a shareholder company, altering the control or ownership structure, the MBR must still be informed.
Penalties for Non-Compliance and failure to report Changes in Beneficial Ownership
Failure to comply with these reporting obligations can result in financial penalties. Regulation 6(5) stipulates that the company and any responsible officers will be held jointly and severally liable. The MBR may impose:
- A maximum penalty of €5,000 for non-compliance.
- An additional €100 daily penalty until the required documentation is submitted.
Ensuring Compliance with Corporate Law
To avoid penalties and ensure compliance with corporate law, companies should inform their Corporate Service Provider (CSP) before any changes in beneficial ownership take place. This will ensure that all necessary forms are submitted to the MBR in a timely manner, keeping the company in line with its legal obligations.
FAQs on Changes in Beneficial Ownership
1. What is beneficial ownership? Beneficial ownership refers to individuals who ultimately own or control a company, even if their names are not listed as official shareholders.
2. How do I report changes in beneficial ownership? Companies must submit a BO2 Form to the MBR within 14 days of the recorded change.
3. What happens if I fail to report changes in ownership? Non-compliance may result in fines up to €5,000 and additional daily penalties.
Need help reporting Changes in Beneficial Ownership?
If you need assistance with reporting changes in beneficial ownership or ensuring compliance with corporate regulations, our team is here to help. Get in touch with us today!
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