ACT No. VIII of 2003 An Act to make provision for the establishment of a corporation in Malta to promote the establishment and expansion of business enterprises in Malta, to determine its functions and powers and to provide for matters ancillary or incidental thereto.

I assent.

G UIDO DE M ARCO

(L.S.)

President

1st August, 2003

ACT No. VIII of 2003

An Act to make provision for the establishment of a corporation in Malta

to promote the establishment and expansion of business enterprises

in Malta, to determine its functions and powers and to provide for

matters ancillary or incidental thereto.

BE IT ENACTED by the President, by and with the advice and

consent of the House of Representatives, in this present Parliament

assembled, and by the authority of the same, as follows>-

PART I

Preliminary

(1) The short title of this Act is the Malta Enterprise Short title and

coming into force.

Corporation Act, 2003.

(2) The provisions of this Act, other then the provisions of

article 30 thereof shall come into force on such date as the Minister

responsible for economic policy may by notice in the Gazette establish.

(3) Article 30 of this Act shall be deemed to have come

into force on the 1st May 2003.

In this Act, unless the context otherwise requires>–

Interpretation.

“committee” means a committee of the Corporation

established under articles 12 and 13 of this Act<

“directors” means the members appointed to the Board of

Directors of the Corporation under article 6 of this Act<

“effective date” means the date established by the Minister

in virtue of subarticle (2) of article (1)<

“financial year” means any period of twelve months ending

on the 31st day of December of each year or such other date as

may be determined by the Board with the concurrence of the

Minister.

Provided that the first financial year of the Corporation shall

commence on the coming into force of this article and shall end on

the 31st day of December of the next following year<

“Malta” has the same meaning as is assigned to it by section

124 of the Constitution of Malta<

“secretary” means the secretary of the Board appointed in

terms of article 14 of this Act<

“the Board” means the Board of Directors of the Corporation

established under article 6 of this Act<

“the Chairman” means the Chairman of the Board of Directors

appointed under article 7 of this Act<

“the chief executive officer” means the chief executive officer

of the Corporation appointed under article 9 of this Act<

“the Corporation” means Malta Enterprise, a corporation

established under article 3 of this Act<

“the Minister” means the Minister responsible for economic

policy and includes, to the extent of the authority given, any person

authorised in that behalf for any purpose of this Act.

PART II

Establishment and Functions of the Corporation

(1) There shall be a corporation, to be called Malta Establishment of the

Corporation.

Enterprise, to perform the functions assigned to it under this Act.

(2) The Corporation shall be a body corporate having a

distinct legal personality and be capable, subject to the provisions of

this Act, of entering into contracts, of acquiring, holding and disposing

of any property for the purpose of its functions, of suing and being

sued, and of doing all such things and entering into all such transactions

as are incidental or conducive to the exercise or performance of its

functions under this Act.

(1) The Corporation shall have the following functions>

Functions of

Corporation.

(a) To originate, lead and further initiatives relating to the

economic and social development of Malta<

(b) To lead Malta’s strategy as relates to all forms of

enterprise, ensuring the implementation of such activity through a

co-ordinated and coherent approach<

(c) To develop, and to provide the required assistance and

support services to industry and enterprise in Malta<

(d) To promote Malta as a location for businesses, to assist

and co-ordinate its promotion as such a location<

(e) To promote, assist and develop the establishment,

competitiveness and internationalisation of business in Malta<

(f) To develop the technological, human resource, and skills

bases, and to strengthen the capacity of business enterprises, to

undertake strategic assessment and formulation, to innovate, and

to undertake research, development and design activities<

(g) To provide and manage land, sites, premises, services,

and facilities for business enterprises<

(h) To administer schemes, grants and other financial

facilities requiring the disbursement of funds, including funds

originating from foreign sources<

(i) To advise the Minister on any matter relating to the

operations and purposes of this Act< and

(j) To carry out such other functions as may be assigned to

it by the Minister from time to time.

(2) In the exercise of the above functions, the Corporation

shall have power to>-

(a) make all forms of investment, including direct ownership

of business enterprises in its own right or in partnership with other

persons, grant loans and advances to enterprises, subscribe,

underwrite or deal in shares and debentures of companies, guarantee

loans and advances to other persons, make grants to enterprises,

and manage and control business enterprises> provided that in any

such transaction as aforesaid the investment or liability of the

Corporation shall be made or assumed at fair risk<

(b) acquire, sell or otherwise dispose of or lease land, plant,

machinery and equipment, and other property, and to otherwise

make available property for use by other persons<

(c) manage land, and to develop land, and to carry out works

on land, and to maintain works or assist in their maintenance<

(d) provide advisory or other services or facilities in relation

to any of its functions, or to assist in their provision< and

(e) generally do all such things as may be incidental or

conducive to the performance of its functions.

The Corporation may, with the approval of the Minister,

exercise its functions under this Act through the agency of other persons,

and may act as agents or otherwise on behalf of other persons.

PART III

Functions and Powers of the Board

(1) The affairs of the Corporation shall be directed by and

shall be the responsibility of the Board.

(2) (a) The Board shall consist of not less than six and

not more than ten voting members as the Minister may from time to

time, appoint.

(b) One of the voting members shall be designated by the

Minister to be Chairman of the Board and another voting member may

be designated as deputy Chairman.

(3) (a) The members appointed by the Minister shall be

persons, except as indicated in paragraph (b) of this subarticle, not being

public officers or staff of the Corporation, who appear to the Minister

to have experience of and show ability in matters relating to industry,

trade, finance, education, science, the professions, or organisations of

employers or of workers.

(b) The Minister may appoint not more than two public

officers one of whom to represent the Ministry responsible for industry

and the other representing the Ministry responsible for finance.

(4) Two members appointed by the Minister from a list of

five persons that are submitted by constituted bodies which in the opinion

of the Minister better represent the interests of the commercial sector,

which constituted bodies will be declared in a separate legal notice.

(5) There shall be paid to the voting members of the Board

such remuneration, if any, as the Minister may from time to time

determine.

(6) Each voting member shall hold office for such term and

on such terms and conditions as the Minister may deem proper< members

of the Board shall be eligible for re-appointment.

(7)

A person shall not be qualified to be appointed, or to

remain, a member of the Board if he>–

(a) is a member of the House of Representatives<

(b) is a judge or magistrate<

(c) is adjudged bankrupt or has entered into any arrangement

with his creditors<

(d)

is interdicted or incapacitated<

(e) is convicted of an offence affecting public trust, theft,

or fraud or of knowingly receiving property obtained by theft or

fraud<

(f) is subject to a disqualification under section 320 of the

Companies Act.

(8) A voting member of the Board may at any time resign

his office by letter addressed to the Minister and the resignation shall

take effect from the date specified therein, being a date that does not

precede the date of the letter of resignation.

(9) A voting member of the Board may at any time, be

removed from membership of the Board by the Minister if, in the

Minister’s opinion to be stated in the instrument effecting the removal,

the member has become incapable, through ill-health, or any other

reasons of performing his functions, or his removal appears to the

Minister to be necessary for the effective performance by the Corporation

of its functions.

(10) If a voting member of the Board dies, resigns, retires,

becomes disqualified or is removed from office, the Minister may

appoint a person to be a member of the Board to fill the vacancy so

occasioned and the person so appointed shall hold office for the

remainder of the period for which the person who occasioned the

vacancy was appointed.

(1) The Chairman shall hold office for such term and on

such terms and conditions as the Minister may deem proper< the

Chairman shall be eligible for re-appointment.

(2) Where the Chairman ceases to hold office as a member

of the Board he shall also cease to hold the office of Chairman.

(3) The Chairman may, at any time, resign from his office

as Chairman by letter sent to the Minister and the resignation shall,

unless previously withdrawn in writing, take effect on the date specified

therein, being a date that does not precede the date of the letter of

resignation.

Where the Chairman is absent from Malta or is temporarily

incapacitated from performing the functions of his office, or is on

vacation, and where the post of Chairman is temporarily vacant, the

Deputy Chairman, if appointed, shall act instead of the Chairman and

shall exercise the powers and perform the functions of the Chairman

during such period.

(1) The Chief Executive Officer shall be appointed by the

Board.

(2) The Chief Executive Officer shall be appointed to hold

office for a term not exceeding three years> provided that a Chief

Executive Officer shall be eligible for re-appointment for further periods

each of not more than three years> provided further that in aggregate no

person shall hold the post of Chief Executive Officer for more than

nine consecutive years.

(3) The Chief Executive Officer shall, subject to the

direction of the Board, carry on and manage and control the operations

and business of the Corporation and shall perform such other functions

as may be determined by the Board.

(4) The Chief Executive Officer shall not hold any other

office or position or carry on any business activity without the consent

in writing of the Board.

(5) The Chief Executive Officer may from time to time be

invited to attend meetings of the Board< however, he shall not have a

right to vote.

(1) The Board may act notwithstanding any vacancy among Meetings of the

Board.

its members> provided a quorum is present at each meeting.

(2) (a) The quorum at all meetings of the Board shall be

half the number of voting directors for the time being constituting the

Board and shall in no case be less than three voting members<

(b) In the absence of the Chairman at any meeting of the

Board the Deputy Chairman, if appointed, shall act as Chairman, in the

absence of both the Chairman and of the Deputy Chairman the directors

present may select from amongst themselves a person to act as Chairman

at the meeting.

(3) The decisions of the Board shall be taken by a majority

of the votes of the members present and voting. The Chairman or other

person presiding at the meeting shall have a second or casting vote.

(4) The Board shall hold such number of meetings as may

be necessary for the performance of its functions, and shall meet not

less than twice in every six months. The Chairman of his own motion

or at the request of any two of the voting directors may at any time

convene a meeting of the Board.

(5) The Board shall cause minutes of each meeting to be

kept and such minutes shall be confirmed at the next successive meeting.

Certified copies of the minutes of any meeting of the Board shall be

forwarded to the Minister on his request.

(6) The Board may make standing orders regulating its own

procedure generally, and, in particular, regarding the holding of meetings

of the Board, the notice to be given of such meetings, the proceedings

thereat, the keeping of minutes, the custody, production and inspection

of such minutes, and the opening, keeping, closing and audit of accounts>

provided that subject to the preceding provisions of this article and of

any standing orders made thereunder the Board may regulate its own

procedure.

(1) The representation of the Corporation shall vest in the

Chairman or in such other person or persons as the Board may by

resolution designate. Notice of any such resolution shall be published

in the Gazette.

(2) Any document purporting to be an instrument made or

issued by the Corporation and signed by the Chairman or by the Chief

Executive Officer and by the Secretary, if any, on behalf of the

Corporation shall be received in evidence and shall, until the contrary

is proven, be deemed to an instrument made or issued by the Corporation.

(1) The Board may establish committees, with such terms

of reference as may be decided by the Board, to assist and advise it in

relation to the performance of any of its functions and may delegate to

any such committee any of its functions, whether in whole or in part.

(2) The members of the committees shall be appointed and

removed by the Board and shall consist of such number of members as

the Board may deem proper. A committee may include persons who

are not members of the Board or officers or employees of the

Corporation. Members of a committee may be removed by the Board.

(3)

A committee may, at any time, be dissolved by the

Board.

Provided that this subarticle shall not apply to the Audit Committee

established under article 13.

(4) The Board may regulate the procedure of any committee.

(5) The acts of a committee shall be subject to confirmation

by the Board save where the Board dispenses with the necessity for

such confirmation.

(6) There shall be paid out of the income of the Corporation

to members of a committee such allowances for expenses incurred by

them in the discharge of their functions as the Board may determine

with the consent of the Minister.

(1) The Board shall establish an Audit Committee with Audit Committee.

written terms of reference which clearly lay down the authority and

duties of such committee.

(2) (a)

The Audit Committee shall meet at least four times

a year.

(b) Meetings of the Audit Committee shall be chaired by

a voting director of the Corporation.

(c) The members of the Audit Committee shall be appointed

on such terms and conditions as may be determined by the Board.

(3) Without prejudice to the generality of the provisions of

subarticle (1) hereof, the Audit Committee shall have the following

functions>-

(a) oversight of the systems of internal control and risk

management of the Corporation and to assist and support the Board

in discharging its responsibilities in relation thereto<

(b) to provide the communication link with external

auditors and to evaluate and co-ordinate the audit and financial

reporting process of the Corporation< and

(c) to review and assess the effectiveness of management

of the Corporation in its compliance with policies and in the

discharge of its regulatory and compliance functions.

(4) The Audit Committee shall report to the Board annually

and at such other times as may be directed by the Board.

(1) The Corporation may employ, on such terms and Staff of

conditions as the Board may determine, such number of persons to be Corporation.

members of staff of the Corporation, as it may consider necessary for

the proper performance of its functions. One such staff member shall

be designated by the Board to act as its Secretary.

(2) The grades of the staff of the Corporation, the numbers

of staff in each grade and the appropriate level of remuneration for

each grade shall be determined by the Board, with the concurrence of

the Minister.

(1) Where the Chief Executive Officer, a member of the

Board, a member of staff of the Corporation, a member of a committee

established under articles 12 or 13, or a consultant, advisor or other

person engaged by the Corporation, or a member of the Board, has any

interest in, or material to, any matter which falls to be considered by the

Board, or a committee established under this Act, he shall>–

(a) disclose to the Board or committee, as the case may be,

the nature of his interest at the first meeting of the Board or

committee after such interest is acquired or in advance of any

consideration of the matter, whichever is the earlier,

(b) neither influence nor seek to influence a decision in

relation to such matter,

(c) take no part in any consideration of such matter,

(d) if he is the Chief Executive Officer, a member of the

Board, a member of the staff of the Corporation or a member of a

committee established under articles 12 or 13, withdraw from the

meeting for so long as the matter is being discussed or considered

and shall not vote or otherwise act in such capacity in relation to

the matter.

(2) Where a question arises as to whether or not a course of

conduct, if pursued by a person, would be a failure by him to comply

with the requirements of sub-article (1), the question shall be determined

by the Board and the decision and its motivation shall be recorded in

the minutes of the meeting where it was taken.

(3) Where a disclosure is made to the Board or to a

committee pursuant to sub-article (1), particulars of the disclosure shall

be recorded in the minutes of the relative meeting.

(4) Where a person referred to in this article fails to make

the required disclosure, the Board shall decide the appropriate action

(including removal from office or termination of contract) to be taken>

Provided that where such person is a voting director of the

Corporation the matter shall be reported to the Minister.

(1) Save as otherwise provided by this Act and sub-article

(2) or any other law, a person shall not, except where necessary for the

proper performance of his functions, without the consent of the Board,

disclose to any person any non-public information obtained while

performing (or as a result of having performed) duties as> -

(a) a member of the Board<

(b) the Chief Executive Officer<

(c) a member of the staff of the Corporation<

(d) a member of a committee established under articles 12

or 13< or

(e) an advisor or consultant to the Corporation or an

employee of such person whilst performing duties relating to such

advice or consultation.

(2) Nothing in sub-article (1) shall prevent disclosure to the

Minister of information in a report made to the Corporation or on behalf

of the Corporation.

(3) Saving any disciplinary action which the Board may

deem appropriate to take, any person who violates the provisions of

this article shall be guilty of an offence and shall, on conviction, be

liable to a fine ( multa) of not less than five hundred liri and not more

than five thousand liri or to imprisonment for a period not exceeding

six months, or to both such fine and imprisonment.

(1) The Minister may, from time to time after consultation Reports to the

Minister.

with the Corporation, give to the Corporation directions of a general

character, not inconsistent with the provisions of this Act, on the policy

to be followed by the Corporation in carrying out its functions under

this Act.

(2) The Board shall give effect to the directions received

from the Minister under this article.

(3) The Corporation shall provide to the Minister all such

information with respect to the property and exercise of the functions

of the Corporation, and shall furnish him with returns, accounts and

other documents with respect thereto, and shall afford him all required

facilities for the verification of information furnished in such manner

and at such times as he may reasonably require.

PART IV

Financial Provisions

(1) The initial capital of the Corporation shall be one million Capital of the

liri paid in by the Government. Further capital shall be raised in such Corporation.

manner as the Minister responsible for finance may, on the advice of

the Corporation, from time to time determine>

Provided that the capital of the Corporation shall be held entirely

by the Government.

(2) The Corporation shall, in return for any moneys and

any property, rights or interests from time to time, paid or transferred to

the Corporation by the Government by way of subscription to the capital

of the Corporation, issue to the Minister responsible for finance on behalf

of the Government capital stock in the amounts of any moneys so paid

and received and in an amount equal in nominal value to the amount

agreed between the Corporation and the Government as representing

the value of any property, rights and interests so transferred.

(1) The Corporation may, with the approval of the Minister

responsible for finance, from time to time borrow such sums as it may

require for the purpose of meeting any of its obligations or discharging

any of its functions.

(2) Notwithstanding the provisions of sub-article (1) above,

the Corporation may without further authority exercise its borrowing

powers for the purpose of borrowing temporarily, by way of overdraft

or otherwise, sums not exceeding in the aggregate one million liri at

any one time outstanding or exceeding such sum established by the

Minister responsible for finance by order published in the Gazette.

(3) For the purpose of securing any sums borrowed by the

Corporation or any liability assumed by the Corporation in the exercise

of its functions, the Corporation may hypothecate or charge its property,

or any part thereof, and may issue debentures, debenture stock, bonds

or other securities, whether outright or as security for any debt, liability

or obligation of the Corporation or of any third party.

(1) The Corporation may establish funds as may be required

in the running of its operations.

(2) Such funds shall be managed by the Corporation in such

manner as it may determine< but no part of such funds shall be applied

otherwise than for the purposes of the Corporation.

It shall be the duty of the Corporation to conserve its assets

and to exercise and perform its functions under this Act as to ensure

that the expenditure required for the proper performance of its functions

shall, as far as practicable, be met out of its income.

(1) The Corporation shall in each financial year cause to Annual

and accounts of the

be prepared and shall adopt estimates of income and expenditure of the Corporation.

Corporation for the following financial year.

(2) The Corporation shall cause to be kept proper accounts

and other records in respect of its operations and transactions, and shall

cause to be prepared a statement of accounts in respect of each financial

year.

(3) The accounts of the Corporation shall be audited by an

auditor or auditors appointed by the Corporation from year to year.

(4) The Corporation shall, not later than four months after

the end of each financial year, cause a copy of a statement of its audited

accounts to be sent to the Minister and to the Minister responsible for

finance together with a copy of the report of the auditor or auditors with

respect to such statement.

(1) The Corporation shall, not later than four months after Annual Report.

the end of each financial year, make and transmit to the Minister a

report of its activities during that year, containing such information

relating to the functions and to the proceedings of the Corporation as

the Minister may, from time, to time, require, together with the audited

accounts as provided under article 22 above.

(2) The Minister shall cause a copy of every such report

and accounts to be laid on the Table of the House of Representatives

within two weeks, or, if at any time the House is not in session, within

two weeks from the beginning of the next following session.

PART V

Transitory Provisions.

(1) With effect from the effective date and subject to the Transfer of

undertakings.

provisions of article 27, all the undertakings to which this article applies

shall, by virtue of this Act and without further assurance, be transferred

to, and shall vest in the Corporation under the same title by which they

were held by the Malta Development Corporation or by the Malta

External Trade Company Limited or by the Institute for the Promotion

of Small Enterprise Ltd, immediately before such date.

(2) (a) The Minister may by order from time to time direct

that any undertaking held by any organisation or entity referred to in

the order shall by virtue of the order, subject to the provisions of article

27 of this Act vest in the Corporation in the same manner as they were

held immediately before the effective date of the order by such

organisation or entity.

(b) The provisions of paragraph (a) hereof shall apply with

regard to an organisation or entity which is wholely owned, directly or

indirectly, by the Government or a corporation established by law.

(c) The provisions of articles 25 and 26 shall multis mutandis

apply to any undertaking in respect of which an order is made by the

Minister in virtue of paragraph (a) of this article.

(3) For the purposes of this Part of the Act, “undertakings”

shall include all stocks and other property movable or immovable, assets,

powers, rights, privileges held or enjoyed in connection therewith or

appertaining thereto, as well as all liabilities and obligations affecting

or relating to any of the aforesaid undertakings or other thing included

therein as aforesaid.

Subject to article 27 and to the other provisions of this Act,

all laws, rules, regulations, orders, judgments, decrees, awards, deeds,

bonds, advances, contracts, agreements, instruments, documents,

warrants and working arrangements, subsisting immediately before the

appointed day, affecting or relating to the Malta Development

Corporation or by the Malta External Trade Company Limited or by

the Institute for the Promotion of Small Enterprise Ltd, or to which any

of the said entities was a party, shall be of as full force and effect against

or in favour of the Corporation, and shall be enforceable as fully and

effectually as if, instead of the said entities, the Corporation had been

named therein or had been a party thereto.

(1) Subject to the provisions of article 27, where anything

has been commenced by or under the authority of the Malta Development

Corporation or the Malta External Trade Company Limited or the

Institute for the Promotion of Small Enterprise Ltd, prior to the effective

date and such thing is in relation to any of the transferred undertakings,

such thing may be carried on and completed by or under the authority

of the Corporation.

(2) Where immediately before the effective date any legal

proceeding is pending to which the Malta Development Corporation or

the Malta External Trade Company Limited or the Institute for the

Promotion of Small Enterprise Ltd is or is entitled to be a party, and

such proceeding refers to any of the transferred undertakings, the

Corporation shall, with effect from the effective date, be substituted in

such proceeding for the relative entity, as the case may require, or shall

be made a party thereto in like manner as any of the said entities, as the

case may be, would have become, and such proceeding shall not abate

by reason of the substitution.

(3) The Minister may by order make such incidental,

consequential and supplemental provisions as may be necessary or

expedient for the purpose of securing and giving full effect to the transfer

of any undertaking to the Corporation by or under this Act and may

make such orders as may be necessary to make any powers and duties

exercised by the Malta Development Corporation, the Malta External

Trade Company Limited or by the Institute for the Promotion of Small

Enterprise Ltd, in relation to any of the transferred undertakings,

exercisable by and on behalf of the Corporation.

(1) The following matters which relate to the specific entity Exclusions.

indicated hereunder shall not be transferred to the Corporation>-

(a) title to the premises from which the Malta Development

Corporation, was operating prior to the effective date<

(b) all court proceedings and pending litigation commenced,

prior to the effective date, between any one of Malta Development

Corporation, the Malta External Trade Company Limited, or the

Institute for the Promotion of Small Enterprise Ltd, and any of the

employees of any one of the said entities, whether former or then

current<

(c) obligations arising out of>

(i) all contracts of employment with any employees,

and

(ii) all contracts for service with any agents, advisors

or any service providers entered into and effective prior to

the effective date, between any of the persons mentioned in

(i) and (ii) above and any one of the Malta Development

Corporation, the Malta External Trade Company Limited or

the Institute for the Promotion of Small Enterprise Ltd.

(2) All rights and proceeding relative to any of the matters

referred to in subarticle (1) hereof shall upon the effective date be

exercised by, instituted or continued by or against the Attorney General

or such other public officer in the name of the Government or the

Minister may from time to time by notice in the Gazette determine.

PART VI

Miscellaneous

The Corporation shall not be wound up except by or under

the authority of an Act of Parliament.

(1) The Malta Development Corporation Act is hereby

repealed and subject to the provisions of articles 24 to 27 any reference

in any law to the Malta Development Corporation shall be deemed to

be a reference to the Corporation established under this Act.

(2) The Malta External Trade Company Limited, The

Institute for the Promotion of Small Enterprise Ltd and the Malta

Enterprise Ltd. are without the requirement of any further formality

required by any other law wound up and dissolved.

Article 3 of this Act establishing the Corporation shall be

deemed to have come into force on 1st May 2003 limitedly for the

purpose of recruiting such members of the staff as may be required for

the running of the Corporation upon the coming into force of the other

provisions of this Act and for such purpose until the coming into force

of article 6 of this Act the Board of the Corporation shall consist of the

Board of Directors of Malta Enterprise Ltd who for the purposes stated

in this article shall be deemed to have all the power, duties and

obligations of the Board of Directors under the foregoing provisions of

this Act.

For subarticle (8) of article 57 of the Business Promotion

Act, there shall be substituted the following>

Business Promotion

“(8) The members of the Board and the Secretary shall be

paid such honorarium as the Minister may determine.”.

Passed by the House of Representatives at Sitting No. 28 of the 21st July,

2003. A NTON T ABONE

Speaker

R ICHARD J. C AUCHI

Clerk to the House of Representatives