Category: Employment

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Will Brexit impact Maltese businesses?

Categories Employment, Residence, Malta, Governance, Brexit

Will Brexit impact Maltese businesses?

On the 29th of March, 2019, The United Kingdom is set to leave the European Union. Whilst very little has been negotiated so far, the EU and the UK are working hard to reach a trade agreement that will seek to limit disruption as much as possible.

When the UK leaves the EU in five months’ time it will be automatically treated as a third country and as such, different rules will apply on import, export, and migration.

If you or your business is actively engaged in the import or export of products from the United Kingdom, you will be obliged to declare these goods, even if you transport them through EU countries. Excise goods will also be affected and you will have to deal with EMC procedures as well as filing import/export declarations.

Furthermore, Malta is set to lose the UK as its strongest tax harmonisation ally, according to Marisa Xuereb, Director of Raesch Quarz LTD.

“The biggest risk for Malta as a whole and for Maltese businesses will come after Brexit when the island sits at the EU negotiation table without Britain.”

It seems that very few businesses have yet to prepare themselves for the worst case scenario which could result in serious fiscal challenges after the UK leaves. Despite Malta’s long-term special relationship with the UK, this is likely to become tense as Malta vies for co-location, or as an alternative to a UK base.

Issues also arise around the uncertainty of where British citizens who reside in Malta will stand in terms of residency and employment, as many based their applications on being EU citizens. The right to work and reside in EU member states and the effect that the UK withdrawing from the EU will have on the thousands of British expats in Malta, as well as the many Maltese in Europe, hangs at a balance.

Businesses that employ UK staff are advised to see what the outcome of ongoing negotiations are, whilst being reminded of the fact that Malta is still a part of the British Commonwealth, and as such, British citizens should not be treated as foreigners.

With just a few short months to go until the UK officially leaves, businesses, expats, and legal professionals will just have to wait and see how this monumental occurrence will impact businesses both here, and in Britain.

If you are interested to incorporate your company in Malta, E&S Group can help you. Send us an email on [email protected] for further information.

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Malta Gaming Authority together with MCAST launching European Gaming Institute of Malta.

Categories Business, Employment, Economy, iGaming, Remote Gaming, Regulatory, MaltaTags , ,

The (EGIM) European Gaming Institute of Malta was officially launched yesterday at the offices of the MGA.

The Gaming Institute was launched together with the MCAST and the MGA and will officially set up a course at MCAST which will equip students with necessary skillset and knowledge for working in the gaming industry.

Junior Minister for Financial Services, Digital Econ. & Innovation Silvio Schembri stressed out that one of his first priorities when he took over the office was launching of the Gaming Institute which will bring professionalism and skills of gaming workforce to another level. Malta has been one of the most proactive jurisdictions in the gaming industry, and the launch of the Gaming Institute is another way to illustrate its determination to remain in the leading position within the gaming industry.

Besides transparent, effective and efficient regulatory framework, professional, educated and skilled workforce will help Malta operators to achieve even higher standard of providing gaming related services in products.

The gaming industry already provides more than 12% of the local GDP growth, Schembri said, with an equivalent sum of €560 million. It has recently become the third biggest economy pillar in Malta.

Joseph Cuschieri, the Malta Gaming Authority Chairman said that EGIM was first announced in the 2015 budget, and commented as follows:

“We know MCAST has the necessary resources and the know-how to give such a course.”

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Amendments to the Fringe Benefit Rules

Categories Business, Tax, EmploymentTags , , , , ,

On the 8th of August 2017 Amendments were made in relation to the Fringe Benefit Rules. There were a variety of changes which affect a large range of fringe benefits.


The changes were the following:

  1. Private Vehicles

In relation to private vehicle use there are a few notable changes that take affect due to these changes. Importantly as of the amendments, vans have been excluded from the definition of a vehicle for the purpose of Fringe Benefits Rules, and as such the private use of a van will be deemed to have no value for these purposes anymore.

Further when calculating the private use percentage of a vehicle, the percentage of the fringe benefit value taken into consideration in cases when the vehicle value is €16,310 or less, has been reduced from 20% to 0%.

  1. Immovable Property

The process of determining the value of the fringe benefit in relation to immovable property has also been altered. The new amendments state that in the event of immovable property being held by a person under the title of either a perpetual or temporary emphyteusis, the cost of the immovable property will only amount to the price or premium paid in accordance with the deed of emphyteusis. There was a previous requirement to increase the annual ground rent payable by five times that amount, which through these amendments is now removed.

  1. Interest

Benchmark rates of interest on loans granted by a bank are now limited to the rate on the main refinancing operations as applied by the Central Bank of Malta, as prevailing at the end of the previous calendar year. This replaces the old system of applying the central intervention rate. In all other cases the benchmark rate of interest on other loans will now be 6.5% decreased from the previous 8.5%. Further cases where a loan is granted to a shareholder, who holds more than 25% of the ordinary share capital and voting rights of that same company, will result in no fringe benefit.

  1. Others

The new Fringe Benefit Amendments further resulted in some circumstances no longer being considered to constitute any fringe benefits. One of these areas which no longer constitutes fringe benefits is in relation to certain health related costs. These costs included medical examinations, medical care, medicine and treatment. Also areas relating to mental health such as counselling, stress management and drug/alcohol abuse. Reimbursements for the use of mobile phones or facsimile machines will also no longer create any fringe benefits. The above are just a few of the many areas which no longer constitute fringe benefits.


Contact us on [email protected] to inquire more information!

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Employers monitoring employees communications?

Categories Business, EmploymentTags , , , , ,

On the 5th of September 2017 the Grand Chamber made an important judgement in a case concerning the monitoring of an employee’s electronic communication by a private employer. This case involved the dismissal of Mr. Barbulescu from his job due to the uncovering of his use of a work email for personal correspondence.

Cases concerning email privacy in the workplace continue to become a contested issue, where in the past Courts have tended to side with the employers. However the judgement in this case favoured Barbulescu ruling that the company’s actions were in direct violation of his Article 8 rights, as per the European Convention on Human Rights (the right to privacy).

In essence, moving forward this judgement does not mean that employers cannot monitor employees’ communications or that employees cannot be dismissed for using internet at work for personal reasons. Rather this judgment lays out certain criteria that should be followed to ensure that when monitoring employees’ communications there is no violation of their Article 8 rights. The criteria to be followed as laid out in the judgement are as follows;
• The employee should be notified of the possibility that the employer might monitor any communications. This notification must be given in advance of the monitoring and clearly indicate the nature of the monitoring;
• The extent of the monitoring on behalf of employer is an important factor in deciding whether a violation has occurred. Factors to be assessed are whether all communications were monitored, the monitoring of actual content and the extent to which this occurred and the number of people who had access to results of the monitoring;
• A legitimate reason must be provided to justify monitoring communications and assessing their actual content, more justification is required in regards to assessing actual content;
• Assessment will occur into whether the employer could have achieved their aim without directly accessing the full contents of the employees’ communications;
• The consequences of the monitoring for the concerned employee and how the employer used the results, particularly were they used to achieve the declared aim;
• Whether the employee has been provided with adequate safeguards, especially where monitoring operations were of an intrusive measure. These safeguards should be in place to ensure employer cannot access the actual content of the communications, unless employee has been notified in advance of that eventuality.

These guidelines should be followed to ensure that employers do not violate the Article 8 rights of employees when monitoring any form of communications.

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Format ImageCategories Business, Tax, Employment, Regulatory, Aviation

New legislation has entered into Malta’s aviation industry in relation to qualifying employment. The Inland Revenue Department has issued a list of those roles which are considered qualifying. Although the rules came into force on the 24th May 2016, the applications are now available. One should note that the rules apply to individuals not domiciled in Malta.

Individual income from a qualifying contract of employment qualifies under these rules when it is received by a beneficiary in an eligible office. Such  income is subject to tax at a

flat rate of 15% provided that the income amounts to at least 45,000 euros (forty-five thousand euros) annually. The 15% tax rate applies for a consecutive period of five years for European Economic Area (that is, EU countries as well as Norway, Iceland and Liechtenstein) and Swiss nationals and for a consecutive period of four years for third country nationals.

Before applying for this scheme one has to consider all the conditions laid out in the law in order to benefit from the 15% tax.

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