An OECD report has found that Malta is “largely compliant” with the implementation of the standard of transparency and exchange of information on request.
The report was issued by the Global Forum on Transparency and Exchange of Information for Tax Purposes, which is charged with the in-depth monitoring and peer-review of the implementation of international standards.
It concluded that Malta was largely compliant with the standard and drew Malta’s attention on action that needs to be taken.
In 2020, the forum had found that Malta was partially compliant but since then, “Malta made progress in the implementation of the standard in practice”, which led to Malta requesting a supplementary review in 2021.
In its report, the Global Forum’s Peer Review Group analysed exchange of information requests received and sent between July 1, 2019, and June 30, 2022.
The group noted that since the 2020 report, Malta introduced new compliance monitoring measures under the regulations on cooperation with other jurisdictions and continued the “substantial work” in striking off inactive companies from the company register and enhanced cooperation among supervisory authorities.
It observed that this had led to “some improvements” in the supervision and enforcement of the requirements related to the availability of relevant information.
The 2020 report had found that the authorities in Malta faced challenges in the timely handling of requests, particularly due to resource limitations. It had issued recommendations which the latest report found had only been partly addressed.
The forum issued a new set of recommendations concerning improvements needed in the legal and regulatory framework, in particular to ensure that nominee shareholders disclose their nominee status to the legal entity and, where necessary, to the financial authority.
Moreover, as also observed in the 2020 report, the forum found that in practice, supervision and enforcement actions by the relevant authorities should be enhanced to ensure the availability of identity, ownership information and accounting records, in line with the standard.
In reply to the report, Malta said it agreed with the contents and the overall rating. It said it will continue working towards improving its framework and practice in line with the recommendations and as part of its commitment to the international tax transparency standards.
In 2021, Malta was placed on the so-called grey list of untrustworthy jurisdictions by the Financial Action Task Force (FATF), a global anti-money laundering watchdog which had decided the country was not doing enough to combat financial crime.
It was removed from the grey list a year later.