The Maltese tax system does not have a specific “international holding company” regime. However, a Maltese holding company may qualify to hold a “participating holding” in an overseas company. A “participating holding” can take various forms. Primarily, a “participating holding” means a holding of at least 10% of the equity shares of a company not resident in Malta. If the shareholding percentage is less than 10%, its shareholding still qualifies as a participating holding, provided that:

• the Maltese corporate shareholder is entitled at its option to purchase or has the right of refusal on a disposal of the balance of the equity shares of the overseas company;

• the Maltese corporate shareholder is entitled to be represented on the board of the overseas company;

• the shareholding value exceeds LM500,000 liri (or the equivalent sum in a foreign currency);

• the shares are held in the overseas company for the furtherance of the business of the Maltese company