Malta Reforms the Company Service Providers Framework: A More Proportionate Regime Takes Effect
The Malta Financial Services Authority (“MFSA”) has brought into force a significant reform of the regulatory framework governing Company Service Providers (“CSPs”). Act No. X of 2025, amending the Company Service Providers Act (Cap. 529), together with a suite of related Legal Notices, an updated CSP Rulebook and a new stand-alone rulebook for registered persons, all took effect today. The reform follows a public consultation launched by the Authority on 1 November 2024, and is designed to make the regime more proportionate for individuals with limited involvement in company services, while preserving Malta’s alignment with its international AML/CFT commitments.
Why the change
Since the Company Service Providers Act came into force in 2013, and following the 2021 reform that introduced an authorisation-based regime with Class A, B and C categories, the Authority has had little visibility over individuals who provide directorship or company secretary services on a very limited scale, not “by way of business”. Industry also flagged that the previous two-involvement threshold for this population was overly restrictive, pushing experienced individuals out of the market. The 2025 reform addresses both concerns.
What’s new
- A Notification Regime for “Restricted Company Service Providers”. Individuals who act as director, company secretary or in a similar position, but not by way of business, may now hold up to five involvements (across a maximum of two groups of companies) up from two. These individuals must submit a Notification Form to the MFSA within 14 days of first taking up such a position. Anyone already in this situation before the reform had until 16 July 2025 to notify the Authority.
- A Registration Regime for “Limited Company Service Providers”. A new, lighter-touch category has been created for individuals providing directorship or company secretary services by way of business to no more than 10 involvements. Limited CSPs will follow a simplified, streamlined application process with a standard fitness and properness assessment, a €2,000initial capital requirement, and a single annual compliance return combining MFSA and FIAU reporting. They are subject to their own stand-alone Limited Company Service Providers Rulebook.
- A wider exemption for holding companies. The existing exemption for individuals acting as director or secretary of entities licensed, registered or otherwise authorised by the MFSA (or an equivalent overseas regulator) has been extended: such an appointment on the immediate holding company of a regulated entity within the same group will now also fall outside the scope of the Act, provided the CSP Rulebook’s definition of a “group of companies” is met.
- A higher threshold for Class B Under Threshold CSPs. The permitted number of involvements for authorised Class B Under Threshold CSPs has doubled, from 10 to 20. Individuals already holding this authorisation were automatically upgraded to the new cap without needing to take any action. Those who would prefer the lighter Registration regime instead may convert, provided they notify the Authority of their intention by the end of September 2025 to be reclassified by year end.
Separately, by virtue of Legal Notice 90 of 2025, the exemption previously available to VFA Agents providing company services has been removed, following the earlier removal of that role from the Virtual Financial Assets Act.
What this means in practice
Anyone currently providing directorship, company secretary or similar services in Malta, whether as an individual with a handful of involvements or as an established CSP, should reassess which category now applies to them. This is especially relevant for individuals previously relying on the old two-involvement carve-out, and for Class B Under Threshold CSPs weighing whether to remain authorised or move to the new Registration regime. The MFSA has published an updated Guidance Note on the Application of the Company Service Providers Act and a comprehensive, updated FAQ document (version 3.0, 21 May 2025) to help with this assessment.
Should you have any questions about how these changes affect your role, your business, or your group structure, our team would be glad to help you work through the practical implications.
For further information, advisory support and tooling contact us at Diligex for assistance.
Disclaimer: This article is intended for informational purposes only and does not constitute legal, regulatory or compliance advice. Readers should consult the applicable legislation, regulatory guidance and seek professional advice before taking any action based on the information contained herein. Information in this article is accurate to the best of our knowledge at the time of publication and may be subject to change thereafter.
