Archive for September, 2009

Malta Financial Services Authority (MFSA)

September 17, 2009

mfsa

77 Great Estates enjoys close relationships with the Malta Financial Services Authority (MFSA).

MFSA was established by law on 23 July 2002. It is a fully autonomous public institution and reports to Parliament on an annual basis. The MFSA has taken over supervisory functions previously carried out by the Central Bank of Malta, the Malta Stock Exchange and the Malta Financial Services Centre and is the single regulator for financial services. The sector incorporates all financial activity including banking, investment and insurance. The MFSA also manages the Registry of Companies and has also taken over responsibility as the Listing Authority.

The organisational structure of the MFSA ensures that the regulatory and operational functions of the Authority are exercised within strict legal demarcations. The Board of Governors, presided by the Chairman, sets out policy and general direction and is assisted by the Legal and International Affairs Unit. The Director of this Unit is also the Secretary to the Board of Governors. The Supervisory Council, headed by the Director General, is exclusively responsible for issuing licenses and regulation and is composed of the Directors responsible for Banking, Securities, Pensions, Insurance, Company Compliance, Corporate and Trustee Services. Operations are the responsibility of the Board of Management and Resources composed of the Directors responsible for Business Development, Human Resources, Information Technology and Administration led by the Chief Operations Officer. Co-ordination between these two organs is ensured at Co-ordination Committee level.

Over the past decade, Malta has moved from being an offshore to an onshore jurisdiction. It has completed a programme of reforming all its finance sector legislation in line with international best practice and was one of the first 6 countries in the world to reach an advanced accord on fiscal matters with the Organisation for Economic Co-operation and Development (OECD). As a result of this agreement Malta is NOT considered as a tax haven. It is actively involved with the OECD, the EU and the Commonwealth in modelling global regulatory policy.

Malta’s finance industry has benefited significantly from the country’s national policy of moving to the mainstream. Financial services is the fastest growing sector of the Maltese economy and one of the most important employers of trained professional staff.

Creating the MFSA as a single regulator was a structured part of Malta’s long term strategy to create a mainstream finance centre in the country. Malta is a jurisdiction that follows and helps develop international best practice.

Finance companies have benefited from a reduction in bureaucracy, streamlined procedures, lower fees and compliance costs and a more consistent implementation of standards.

The MFSA is also responsible for consumer education and consumer protection in the financial services sector. This function is vested in the Consumer Complaints Manager.

The MFSA has a staff of over 130 people, consisting of specialist regulators, lawyers, accountants and support staff that are involved in communications and organisational administration.

The consumer therefore has one single point of decision making and policy creation. More importantly, the founding of the MFSA means that Malta now has one skilled, experienced and powerful body seeking to protect consumers whilst encouraging fair and open competition in the financial services sector.

The International Tax Unit of the Inland Revenue Department and the Companies Registry are also housed at the MFSA’s offices and have the task of ensuring that all taxation and company registration matters relating to international activity are dealt with swiftly and effectively. The International Tax Unit is also responsible for issuing advance revenue rulings which give certainty to the tax treatment of all international undertakings.

For further information, kindly contact 77 Great Estates on (00356) 2125 2455; (00356) 9944 7444; skype: info.77GreatEstates or info@77GreatEstates.com.

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Two-in-one – Article in The Times of Malta, 15th September 2009

September 15, 2009

 tatoosh

Photo : Matthew Mirabelli

 The 301-foot long Tatoosh, belonging to Microsoft co-founder Paul Allen, is berthed at Lazzaretto Creek next to Manoel island. Ranked the world’s 26th-largest super yacht, she is not only equipped with the “standard” helicopter and tenders, but has a 40-something foot yacht tied to its port side. She was named after an island in the Pacific Ocean, northwest of the US, marking the entrance to the Straits of San Juan De Fuca, which lead to the more familiar Puget Sound and Seattle, home of telecommunications baron Craig MacCaw, who commissioned her. She was sold to Mr Allen in 2001.

“Tatoosh” was admired by everyone at 77 Great Estates’ office situated on Valletta seafront.

For further information, kindly contact 77 Great Estates on (00356) 2125 2455; (00356) 9944 7444; skype: info.77GreatEstates or info@77GreatEstates.com.

Report on Malta as tax haven dismissed as sensational – Article in The Times dated 05th September 2009, by Ivan Camilleri, Brussels

September 11, 2009

germany

Malta has denied “sensational” reports in a German publication suggesting the island was being used as a tax haven by German multinationals.

While admitting there was a recent surge in German investment in Malta, Finance Minister Tonio Fenech said “this is all above board and according to EU laws”.

“German investment in Malta has been present for a long time and the double taxation agreement with Germany is there to facilitate taxation between the two countries and promote investment. We have never had any negative reaction by the German government on this front… This is just sensationalism,” Mr Fenech said.

Describing Malta as “a new tax haven Mecca” for large German multinationals, Germany’s most popular news magazine Der Spiegel gave details of how large German companies were avoiding tax through the island.

The magazine, which sells more than a million copies around Europe every week, accused Germany’s Finance Minister Peer Steinbruck of turning a blind eye to what had become a known “tax loophole” used by Germany’s top companies to “optimise their tax structure” through Malta.

According to an investigation carried out by the magazine, renowned companies like Lufthansa, Puma, BASF, K+S and Fraport were all allegedly using Malta’s taxation system to avoid paying all their dues to the German tax authorities.

They were doing this by forming subsidiary companies in Malta to take advantage of loopholes in the EU taxation system and the double taxation agreement between the two countries to reduce their taxable incomes, the magazine claimed.

The report said this had been going on since Malta joined the EU and despite the German authorities knowing what was happening they did not seem to have the power to do anything to stop it. At the same time the magazine admitted there was nothing illegal in the system being adopted.

“In the global game of financial Monopoly, the small Mediterranean country has become one of German industry’s preferred locations in the time since it joined the EU in 2004,” Der Spiegel wrote.

“German companies have their offices in the town of St Julians, near the Stiletto Gentleman’s Club, and the pubs where foreign language students drink themselves into oblivion. The offices of the BMW Malta Group are near the casino in the upscale Portomaso waterfront development,” the magazine commented sarcastically.

Other German big names, such as Deutsche Bank would also be investing in the island, the magazine reported.

Quoting a partner in an accounting firm in Malta, the report said the number of German companies in Malta was growing rapidly and gave details of how the “tax avoidance system” worked.

Der Spiegel said that, although companies in Malta paid 35 per cent tax on their profits, a rate higher than Germany’s, shareholders could then apply for a refund of the bulk of these taxes. On balance, profit distribution in the form of dividends was taxed at only five per cent. The magazine affirmed that, after taxation, the net dividends were returned to the coffers of the German parent companies, 95 per cent tax-exempt.

Directly criticising the German government for allowing such a system to go on, the magazine charged that “No one (in Germany) seems to be troubled by the fact that this loophole deprives the German Treasury of massive amounts of revenue”.

The magazine also pointed a finger at the German Embassy in Malta saying it was encouraging other German companies to use this system and invest in Malta.

A spokesman for the Foreign Office in Berlin said, when contacted, that the ministry was aware of the article but had no comment to make.

For further information, kindly contact 77 Great Estates on (00356) 2125 2455; (00356) 9944 7444; skype: info.77GreatEstates or info@77GreatEstates.com.