A transaction that closes without meeting Malta's revised notification requirements is not merely irregular – it is voidable. Malta has overhauled its investment screening regime, introducing mandatory pre-closing notification obligations that apply to a broad range of foreign-owned acquisitions. Companies that miss the filing window face suspension of the transaction and potential unwinding of completed deals.
Malta's updated investment screening legislation entered into force in early 2025, requiring foreign investors to submit a formal notification to the national screening authority before completing acquisitions in designated sensitive sectors. The obligation is triggered when a non-EU investor acquires an ownership interest or voting rights above the applicable threshold in a Maltese target. The competent authority has up to 60 working days from receipt of a complete notification to issue a clearance decision or initiate a full review.
This alert explains what changed, which business categories are caught, how the thresholds work, and the concrete steps international companies must take now.
What changed and when it took effect
Malta transposed the EU Foreign Direct Investment (FDI) Screening Regulation into domestic investment legislation through amendments that took effect in the first quarter of 2025. Prior to this reform, Malta operated a lighter-touch voluntary notification system. The new rules replace that system with a mandatory, suspensory regime.
Key structural changes include the following. First, notification is now a condition precedent to closing – not a post-closing formality. Second, the screening authority received expanded powers to request additional information, extend review timelines, and impose conditions or prohibitions. Third, the legislation introduced explicit disclosure obligations for investors regarding their ultimate beneficial ownership, funding sources, and prior investments in other EU member states.
The shift mirrors reforms already enacted in jurisdictions such as Portugal, France, and Germany. For investors already familiar with those regimes, the Maltese system will feel structurally similar. However, Malta's sector definitions and threshold levels reflect specific national security priorities that differ from larger EU economies.
Practitioners advising on capital markets transactions in Malta should treat investment screening clearance as a critical path item in any deal timeline. Alongside prospectus approval and securities offering filings with the Malta Financial Services Authority (MFSA).
Who is affected: sectors, thresholds, and business categories
The notification requirement applies to non-EU investors acquiring qualifying interests in Maltese entities active in designated sectors. The following categories are covered.
- Critical infrastructure – energy, water, transport, digital communications, and financial market infrastructure
- Dual-use technology – including components with both civilian and defence applications
- Financial services – banking, payment institutions, and investment fund operations
- Media and information security – broadcasters, data storage operators, and cybersecurity providers
- Defence and aerospace – manufacturers and maintenance providers in the defence supply chain
The primary threshold triggering mandatory notification is an acquisition of 10% or more of the voting rights or share capital of a target in a designated sector. A secondary threshold applies at 25% and again at 50%, requiring fresh notification each time a holding crosses those levels – even where the original acquisition was already cleared.
The rules also apply to acquisitions by EU-incorporated vehicles where the ultimate beneficial owner is a non-EU person or entity. This is a point frequently underestimated by international groups that structure Maltese acquisitions through EU holding companies. The investment legislation looks through the acquiring entity to the ultimate controller.
Investors in the financial services sector should note that the screening regime operates in parallel with. but is separate from. the licensing and disclosure obligations requirements administered by the MFSA for investment fund authorisation. IPO listing requirements, and general securities offering approvals. Satisfying MFSA requirements does not substitute for FDI screening clearance.
Companies active in banking and finance in Malta face dual scrutiny: prudential oversight from the MFSA and national security review under the new screening rules. Timelines for both processes must be mapped carefully before signing.
To explore whether your transaction falls within the notification perimeter, contact us at info@ferrazwhitmore.com.
What to do now: immediate actions for international companies
The following steps apply to any non-EU investor with a current or planned acquisition involving a Maltese entity in a designated sector.
- Map your ownership structure – Identify the ultimate beneficial owner and confirm whether any EU-incorporated acquiring vehicle triggers the look-through rule.
- Conduct a sector classification audit – Verify whether the Maltese target's primary and secondary business activities fall within a designated category. Sector boundaries are defined in the implementing regulations and can catch ancillary activities that investors often overlook.
- Prepare the notification dossier in advance – The authority requires detailed information on the investor's corporate structure, financing arrangements, prior acquisitions in the EU, and the strategic rationale for the transaction. Assembling this material typically takes two to four weeks.
- Build the screening timeline into the SPA – The sale and purchase agreement should include a regulatory condition precedent covering screening clearance. The longstop date must account for the 60-working-day review period plus any extension the authority may invoke.
- Coordinate with MFSA filings where applicable – For transactions involving regulated entities, investment funds, or entities subject to listing requirements, align the screening notification with MFSA change-of-control approval processes to avoid conflicting timelines.
A parallel alert covering analogous changes in a neighbouring EU jurisdiction is available in our analysis of investment screening developments in Portugal, which may assist investors managing multi-jurisdiction acquisitions across Southern Europe.
About Ferraz & Whitmore
Ferraz & Whitmore is an international law firm based in Lisbon, advising business clients across 46 jurisdictions. Our capital markets practice supports international investors, listed companies. Additionally. Institutional clients on transactions involving Maltese and EU regulatory requirements. from FDI screening notifications and disclosure obligations to prospectus approval, securities offering filings. Additionally, investment fund authorisations before the MFSA. As a law firm in Malta and across Europe, we combine Portuguese civil law expertise with English common law tradition to support clients who need results-oriented counsel across multiple legal systems. The firm's capital markets team has advised on cross-border acquisitions touching both civil law and common law jurisdictions, and participates in international practice groups focused on FDI regulation and financial market compliance. Engaging a lawyer in Malta with cross-border FDI experience is the most efficient way to manage notification risk on a compressed deal timeline. To discuss your transaction and the steps required under the new screening rules, contact us at info@ferrazwhitmore.com.
Disclaimer: This publication is provided for informational purposes only and does not constitute legal advice. The information herein should not be relied upon as a substitute for professional legal counsel tailored to your specific circumstances. Ferraz & Whitmore assumes no liability for actions taken or not taken based on the contents of this material. For advice regarding your particular situation, please contact info@ferrazwhitmore.com.