Creating a Leaner Business Environment

Despite the fact that business births almost doubled between 2012 and 2015, the Maltese Government felt that a radical simplification of the bureaucratic processes which entrepreneurs need to follow in order to set up and operate a business, was needed.

This exercise, which is being led by Malta Enterprise together with the Ministry for the Economy, Investment and Small Business supported by the Office of the Prime Minister, has been spurred on not only by the international ranking associated with government-induced administrative burdens, but primarily by the recognition of the genuine need to facilitate Malta-based businesses.

The first phase of this initiative entailed the reengineering of the administrative processes associated with starting a business and the development of strategies for the implementation of the reforms through internet-based applications.

This was completed by the end of 2016 and the setting up of a business by a self-employed person or a company can now be done via an online portal through the simple completion of a short application form. Applicants are now able to fulfil all the statutory obligations required by local law to start a business totally on line and will be notified through electronic means of their registration numbers within 24 hours of application.

The result is that today a Maltese entrepreneur can set up:

  • A company by following two simple steps within a total of two days (maximum three days), with the first step being the registration of the company with the MFSA, following which they input registration details into the start-up portal for the attainment of their registration numbers (VAT, Income Tax, etc); submitting documents electronically to the MFSA to commence operations now costs €100 on share capital not exceeding €1,500; or,
  • A self-employed business following one step for a total of one day, by simply accessing the start-up portal. There are no fees associated with this step.

This is a radical improvement on the old regime wherein entrepreneurs had to physically visit various government offices, fill in up to 10 forms and wait roughly 30 days to be able to commence operations. Apart from the simplification process, this phase also resulted in the repealing of the superfluous Trade Licence regime for general business operations. This will result in a cost saving of €70 to €1,000 per business entity per annum.

Currently, work is being undertaken to enable the establishment of partnerships through this online registration service as well as on the introduction of a verification step which will allow foreign nationals to utilise the portal. The target for the implementation of the above was the end of January 2017.

Government also recognises that the administrative burdens and obstacles to businesses are not confined to the start-up phase and that the momentum gained during the initial phase can be maintained when simplified procedures are extended to the whole life cycle of a business. The reform will therefore also address the simplification of the processes which businesses need to follow in order to expand their operations, such as recruitment/registration of staff and the obtaining of specific permits linked to the place of operation (particularly for the food sector). It will also tackle the tail-end of the life of a business, covering the simplification for the closure and deregistration of bona fide operations.

Furthermore, following the completion of the above tasks, a team which has been tasked with a systematic, ongoing analysis of all the administrative obligations and services which businesses require, will be established in order to ensure that administrative burdens do not reappear in different forms to hinder business in the future.

Government understands the need to continuously deliver good, efficient and coherent services to businesses. Our entrepreneurs (local and foreign) are the backbone of our economy and government intends to continue encouraging growth by providing better quality online services that create value to businesses.

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