RSM Malta

The Merchant Shipping Act Updates Through L.N. 31 of 2020

On 21st February 2020, the Merchant Shipping (Shipping Organisations - Private Companies) Regulations (S.L. 234.42 of the Laws of Malta) (hereinafter referred to as “the Regulations”) have been amended by Legal Notice 31 of 2020.

 

Audited financial statements

Companies established under The Merchant Shipping Act (“Act”) are now obliged, as at the end of the financial year 2020, to submit audited financial statements to the Malta Business Registrar (“MBR”) within the stipulated period. The requirements are almost identical to those of private limited liability companies established in terms of the Companies Act.

As per Article 182 of the Companies Act, the audited accounts of private companies shall be submitted to the MBR within 42 days from the end of the period for laying of annual accounts, that is, 10 months after the end of the relevant accounting reference period.

Article 182 (3) of the Companies Act highlights that where a company’s first accounting period is a period of more than 12 months from the date of its registration, the period allowed for the approval of a company’s annual accounts in a general meeting shall be reduced by the number of days by which the said accounting period is longer than twelve months. The period shall, however, not be reduced to less than 3 months after the accounting period.

For companies incorporated prior to 21st February 2020, there is no need to notify the Registrar of Companies if the accounting reference period is not December. The companies are requested to file the financial statements within the stipulated periods from the end of the relevant accounting period.

For companies incorporated after the 21st February 2020, whose accounting reference period is not December, a Form J needs to be submitted.  The form J also applies to changes in the accounting reference period.

 

Small Company

A “small” company under the Act cannot exceed 2 of the below 3 thresholds, in terms of Regulation 64 of the amended Regulations:

Balance sheet total of €6,000,000

Turnover of €12,000,000

Not more than 50 employees

Companies which qualify as “small” shall also be entitled to sub-article (2) of Article 185 of the Companies Act exemptions and the provisos to sub-article (2) of Article 183 of the Companies Act.

 

Exemptions from Consolidations

Companies registered under the Act will still benefit from the exemptions outlined in the Companies Act regarding the preparation of the consolidated accounts if the parent company qualifies as a “small” company. A group will qualify as “small” if the aggregate figures do not exceed 2 of the below 3 thresholds:

Balance sheet total of €6,000,000 net or €7,200,000 gross

Turnover of €12,000,000 net or €14,400,000 gross

Not more than 50 employees

 

Other Articles

All Articles of the Companies Act in relation to the keeping of accounting records (and the content and form thereof), exemptions, disclosure requirements, directors’ report, audit reporting and laying of accounts before the general meeting, and submission of accounts, together with the accompanying liabilities and penalties, shall, other than the variations indicated in Regulation 64 of the amended Regulations, be applicable to companies registered under the Act.

 

 

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