Malta provides a very open environment to foreign investment and has done so throughout it’s existence as an independent republic. This article will help to explain how a business can benefit from using Malta as a base of operations.

Article 8 (1) (d) of the Malta Enterprise Act lists the following as one of the objectives of Malta Enterprise (ME):

“to promote Malta as a location for enterprise, to assist and co-ordinate its promotion as such a location.”

In fact, ME lists promoting and facilitating foreign direct investment at the top of its available services.  In addition to the standard packages offered to both local and foreign-owned firms already established in Malta, ME has staff dedicated to making the transition to Malta as smooth as possible.

ME can be counted upon to organize the itinerary for discovery trips to the Maltese islands and will put delegations in touch with all contacts required to ensure that decision makers get all the information they need.  In addition, ME advisers will be on hand to guide investors through the process of setting up a business in Malta.

Once a company has been incorporated in Malta, it has access to a number of support facilities.  Among them is the Business Advisory Services package.  This is a service that is useful to businesses at any point in their life-cycle, whether they are start-ups trying to find their way through the daunting task of penetrating  their first market or established companies that are simply looking for advice in opening a new chapter in their history.

Business advisers are available in a number of areas including, business start-up, development of export activities, intellectual property management and the re-engineering of business processes.  While the service is not free, it is provided at the reasonable rate of €40 per hour.  Every company is entitled to a discount of up to €2500 per annum, with reductions being applied at 50%, 40% or 30% of the hourly rate, depending on whether the company is a small, medium or large enterprise respectively.

Low Operating Costs

In many ways, the rate of €40 per hour highlights the affordability of Malta. While there are costs associated with opening and operating a business anywhere, for most companies their staffing costs are their main expense. For those that need to be located in a central business district somewhere, commercial real estate is another major expense.

While Malta is not free and costs have been rising in recent years, the reality is that staff costs are lower than much of Europe, as is the cost of living for those staff. It is also generally easier to recruit international staff to a sunny island and holiday paradise than to a high cost city in the rain.

There is less commercial real estate available in Malta than might be expected, but many companies – especially in financial services and gaming – have been able to establish themselves. There are a few areas that contain a concentration of the offices in Malta and for international companies needing international staff it will be difficult to be located far away, but even these are very affordable areas when compared to most hotspots in Europe.

The Government Wants To Finance Your Business

The government of Malta also makes financial assistance available to companies doing business in the country.  Article 16 of the Business Promotion Act enables ME to provide soft loans on the purchasing of plant, machinery or other fixed assets (but excluding real estate) which are acquired as part of an investment program with a value of at least €48,917 and a duration of less than three years.

The provision is for at most 75% of the purchasing price of the assets approved by ME to be covered by the loan.  Maximum quotas apply as follows: beneficiary companies deriving 95% or more of their

revenues from export, are entitled to up to €2,329,373; all other companies may borrow a maximum of €465,875 through this scheme.

Interest due is given a reduction of two and a half percentage points for companies deriving 95% or more of their revenues from export and half a percentage point for all other companies.  In other words, an interest rate of 0% or less will never apply.

Hopefully it is becoming clear that over the course of several decades the Maltese government has worked hard to declare itself open for business with policies and assistance that ought to interest companies operating in a wide range of business sectors.