There are situations in which companies cannot keep up with the requirements of the business climate and the conditions imposed by the market. Facing financial problems might lead to insolvency in Malta, but before that, the company must adopt any solution which can save the business and the operations in a reliable manner, for example, the financial restructuring. The legislation regarding insolvency in Malta observes particular conditions that need to be fully understood before making any movement. If you need support in this sense or in company incorporation, we suggest you address to our company formation agents in Malta.
Details about the Insolvency Law in Malta
Financial difficulties might find a company in a continuous struggle for avoiding insolvency. If there is no proper solution in this direction, the company must declare the insolvency. The Commercial Code in Malta also comprises the Insolvency Law which was recently revised by the authorities. Businesses in Malta which cannot pay the debts must respect the conditions imposed by the Insolvency Law and the related provisions. For instance, a proper solution is to restructure the company from a financial point of view but not limited to this. Furthermore, if it is the case, the liquidation of a company may enter in the discussion. One should bear in mind that the insolvency procedure starts with a complete investigation of the company’s financial status. The creditors will be immediately announced that the business can no longer take care of the financial liabilities as mentioned by the signed contracts.
Foreign entrepreneurs can enter the Maltese market and establish companies in a fast and reliable manner. The company formation in Malta is an easy process which can be entirely supervised by our consultants.
How the insolvency process is made in Malta
Any decision regarding the insolvency procedure is taken by the board of director in complete agreement with the owners of the company. The next step is to inform the Trade Register in Malta about any decision made in your company and the stages involved in the insolvency procedure. A list of assets and the financial records of the company must be provided to the authorities in charge when declaring the insolvency.
The results of insolvency in Malta
One should know that the process of insolvency in Malta has two important players: the liquidator responsible for the management of assets in a company, and the official receiver who performs in default of the liquidator. Once the insolvency has been declared, the transfer of shares and the release of securities will, in this stage, be canceled. If the creditors do not agree on the insolvency of the company and they wish to recover the debts in a legal manner, they can do so in the court of law in Malta.
Please consider our support in company formation in Malta and the conditions involved. You may contact our team of company formation specialists in Malta at any time.