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Malta – More than just a great jurisdiction

By Ivan Grech (pictured), FinanceMalta – Malta is, in many ways, an attractive place to do business. This applies to business in general of course, but is particularly the case for financial businesses. This includes funds, be they retail collective investment schemes, alternative investment funds or any of a wide variety of hedge funds falling under the wide umbrella of a “professional investor fund” or PIF.

There are myriad reasons for this attractiveness, starting from the regulatory and legal environment within which financial businesses and funds operate in Malta. While clearly important, these are dealt with at length in many other places, where the various possible structures available to a fund promoter or manager, the advantages of each separate form, the requirements and regulatory duties and also, last but not least, the tax regime applicable, are discussed in depth. There is no better place to start this exploration than FinanceMalta’s guides, moving on then to the excellent publications issued by most Maltese law firms and large accountancy and consulting practices.

In this article, therefore, the focus is upon the other, less technical roots of Malta’s attractiveness. Things like the availability of skilled staff, with the possibility of hiring persons with key skills from overseas if the local labour market cannot supply them. Skilled, effective professional services, whether that be legal, accounting or indeed any other with a good range of linguistic skills, and the near universal use of English.

People: the main resource

It is almost redundant to have to say this, but Malta as a nation has one main national resource. The country does not have any of the major natural resources other countries do: no oil or coal so, until renewable energy sources have been developed to a much greater extent than at present Malta relies on imported energy. There are no metal ores, and Malta’s forests were all cut down in antiquity to build the ships an island nation depends upon. The only real natural resource available is the local stone, which at least makes Malta’s construction business self sufficient as far as its raw materials go.

What this means for the Maltese economy is that the one single, most valuable resource the island has to offer investors is its people and their skills. With no rich natural resources to fall back upon, Malta and more importantly the Maltese have invested in education and in developing the ability to acquire and hone both existing and new skills. This workforce, ready and very able to adapt and to learn, is what has made Malta such an attractive place for investors over the past 20 to 30 years.

Language skills

The skills include, of course, linguistic capabilities. A small island nation cannot survive without the ability to trade and converse with the outside world, and this applies to Malta as much as it does to anywhere else. At the crossroads of the Mediterranean, Malta lives by its trade with all who cross the sea, and given that the Mediterranean is the locus of a considerable portion of global trade that means development of the ability to speak to people from across the world. In this, Malta is lucky to have had British rule for 150 years, which left the English language as one of its most valuable legacies.

The emphasis on trade has further consequences for service-based businesses, and in particular for financial businesses including the entire range of the fund industry. Finance – banking, payment services and insurance but also means to harness savings and investments – have deep roots in these islands. The intensely international side of this business may date back to the reworked legal framework for financial services established in the early 1990s, but the roots supporting that framework go much deeper.


There is a lot more going for Malta than just its people’s skills and language abilities. After all, in a small country there is a tight limit on the numbers of people available, which at first glance ought to lead to potentially limiting staff shortages. Yet Malta, despite being an island on the periphery of Europe, is tightly connected to the rest of the world.

First, and indeed for a very, very long time, by sea. Malta is geographically blessed, right in the centre of the Mediterranean, equidistant from both Suez and the Straits of Gibraltar and ideally placed as a stepping stone between Italy and North Africa. In the contemporary world and for financial services, however, Malta’s air connections are of greater importance, and Malta has regular, frequent and direct air connections to most major European cities, and then on to the rest of the world. Moving people in and out is easy.

This makes the island an easy place from which to conduct a service-based business; clients can visit easily, investors and staff can travel with ease to meet clients, and taking advantage of Malta’s EU membership for more than the valuable passporting rights for financial services, and Malta’s attractive residence schemes, any staff required from outside the islands can easily be employed and brought over.


The modern financial services industry does not, however, rely solely on the ability of clients to physically visit the offices of their service provider. Much of finance is shifting to the internet and other telecommunications channels. Here, too, Malta boasts strong connections, with multiple undersea fibre optic cables linking the island to global networks. The links guarantee multiple redundancy, and thus little or no downtime; the cables laid each have considerable spare capacity allowing for future growth.

Malta’s development of its technological capabilities as applied to financial services go beyond telecommunications. The island is working hard on developing a robust framework within which the services made possible by Distributed Ledger Technologies will be able to flourish. That means an openness to cryptocurrencies and to blockchain, of course. However, the Maltese financial services industry, the Government and the regulator are all acutely aware that the current form of the technology is not the final word on the matter by any means, and the framework being discussed and put in place at the moment is designed to be able to deal effectively with the evolution Distributed Ledgers will undoubtedly undergo.

Even the problems Malta faced in the past on energy supply have now been overcome. With reliance on imported fuel to power purely local electricity generation, Malta had in the past been vulnerable to power shortages. No longer. Malta is now connected directly to mainland European power distribution networks via undersea cables, an interconnector, that ensures that any domestic shortfall can be compensated for with ease.


This all makes Malta a good place to base a fund. Yet there is still more. Once you establish your base, you will want to live in an attractive place; it will also be easier to employ an international staff if you can promise an attractive lifestyle outside the office. Malta provides that as well.

This is a Mediterranean island, with beaches and beautiful weather. It is possible to swim in the sea from April to November; if sailing is your sport, there is no real closed season: you can set forth year round and only be limited by the approach of the infrequent, but admittedly ferocious wind storms. Cultural activities – from theatre to music and more – abound. If its history and archaeology you’re interested in, Malta packs 7,000 years of that along with all the architecture that entails into a compact area. For people with children, the schools are good, affordable and increasingly multi-cultural.

There are very good reasons to establish a fund in Malta based on the legal and regulatory environment, that is definitely true. Malta is in the European Union, and its laws and regulations all conform to EU norms while providing uniquely Maltese solutions. Yet the attractiveness of the islands goes well beyond that dry statement. Malta remains a good place in which to build a life and a business. Visit the island to see it for yourself! 

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