FAMILY BUSINESS ACT

The short title of this Act is the Family Business Act.

In this Act, and in any rules or regulations made under this

Act, unless the subject or context otherwise requires

"applicant" means a business registering as a family business

under this Act;

"benefits" means any assistance or relief granted to a registered

family business in terms of the Duty and Documents Transfers Act,

Malta Enterprise Act, Business Promotion Act and in terms of any

other law or scheme as the Minister may prescribe by regulations;

"established in Malta" means the head office, agency, or branch

or part of a business and shall include a permanent presence of that

business carried out in Malta;

"family business" has the meaning assigned to it in article 3;

"family member" means the family business owner’s spouse,

ascendants, descendants in the direct line and their relative spouses,

brothers or sisters and their descendants or as the Minister may

prescribe;

"guidelines" means the set of rules issued by the Regulator from

time to time for the further implementation of the provisions of this

Act, and any regulations made hereunder, including the definition,

application, administration, grant and revocation of benefits,

schemes and other arrangements for the regulation, management

and transfer of family businesses and their governance in Malta;

"limited liability company" means a company duly formed and

registered under Part V of the Companies Act;

"the Minister" means the Minister responsible for the Malta

Enterprise and includes, to the extent of the authority given, any

* see sub-article (2) of article 1 of the Act as originally enacted, and Legal Notice

387 of 2016.

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person authorised in that behalf for any purpose of this Act;

"owner" means the ultimate beneficiary, natural person who,

directly or indirectly, has a shareholding or other interest in a

family business;

"partnership" means a partnership en nom collectif or partnership

en nom commandite duly formed and registered in terms of Part III

and Part V of the Companies Act;

"prescribed" means either prescribed by regulations made by the

Minister under this Act or prescribed by binding guidelines made

by the Regulator under this Act, unless otherwise expressly stated,

and in the event of a conflict between the regulations made by the

Minister and guidelines made by the Regulator on any particular

matter, the regulations shall prevail;

"private foundations" means those foundations established for a

private interest and registered or otherwise recognised as legal

persons in terms of the Second Schedule to the Civil Code;

"public limited company" means a company duly formed and

registered under Part V of the Companies Act;

"the Regulator" means a person who is appointed to manage,

supervise and administer the Register of Family Businesses

according to this Act and appointed by virtue of article 17;

"spouse" means a spouse in terms of the Marriage Act and a

partner in terms of the Civil Unions Act;

"trusts" means a trust in terms of the Trusts and Trustees Act.

Part II

General Provisions

(1) A family business that can qualify for registration

under this Act shall mean any business established in Malta

whereby

(a) in the case of a public limited liability company whose

shares are listed on a regulated market or traded on a

multilateral trading facility, the majority of the shares

including the rights are held, whether directly or

indirectly, by at least two owners who are family

members within the same family;

(b) in the case of a limited liability company constituted in

a manner other than that referred to in paragraph (a)

(i) all the shares of the company are held, directly

or indirectly, by at least two owners who are

family members within the same family; and

(ii) at least one family member is formally involved

in the general governance, its proper

administration and management of the company

Provided that shares held directly or indirectly by

individuals who are not family members shall be

disregarded for the purposes of this paragraph if their

aggregate issued value does not exceed five per cent of

the issued share capital of the company

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Provided further that shares held directly or indirectly

by employees who have been in continuous, full-time

employment within the family business for over three

years and who are not family members shall be

disregarded for the purposes of this paragraph if their

aggregate issued value does not exceed ten percent of

the issued share capital of the company

Provided further that where any business assets are

held on lease, the family members are the majority of

the lessees in the lease agreement;

(c) in the case of partnerships en nom collectif and

partnerships en commandite

(i) the full capital contribution to the partnership

shall have been made, directly or indirectly, by

at least two owners who are family members

within the same family having, directly or

indirectly, the right to receive the majority of

distributable profits; and

(ii) at least one of whom holds the majority of the

decision making rights

Provided that capital contributions made, directly or

indirectly, by persons who are not family members

shall be disregarded for the purposes of this paragraph

if their aggregate contribution does not exceed five per

cent of the total contribution made by all partners in

the partnership

Provided further that capital contribution made,

directly or indirectly, by employees who have been in

continuous full-time employment within the family

business for over three years and who are not family

members shall be disregarded for the purposes of this

paragraph if their aggregate contribution does not

exceed ten percent of the capital contribution of the

partnership

Provided further that where any business assets are

held on lease, the family members are the majority of

the lessees in the lease agreement;

(d) in the case of a family business where all the shares or

the interest are being held by a trustee under trust for

the benefit of members of a family as beneficiaries,

and which has been established by a written instrument

and all the beneficiaries are owners and family

members within the same family

Provided that other beneficiaries who are not family

members within the same family business trust shall be

disregarded for the purposes of this paragraph if they

do not in aggregate benefit from more than five per

cent of the family business, or if they are only residual

beneficiaries who will benefit from the trust only upon

termination of the trust due to the fact that there are no

existing family members within the same family

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capable of benefiting from the trust at any relevant

point in time

Provided further that other beneficiaries who are

employees who have been in continuous full-time

employment within the same family business trust for

over three years and who are not family members

within the same family shall be disregarded for the

purposes of this paragraph if they do not in aggregate

benefit from more than ten per cent of the family

business trust, or if they are only residual beneficiaries

who will benefit from the trust only upon termination

of the trust due to the fact that there are no existing

family members within the same family capable of

benefiting from the trust at any relevant point in time

Provided further that where any business assets are

held on lease by the trustee, the trustee is the majority

of the lessees in the lease agreement;

(e) in the case of a business carried out by family

members in a form of partnership other than as

indicated in paragraph (c), the business and the assets

of such business are owned and controlled, directly or

indirectly, by at least two owners who are family

members within the same family

Provided that other assets held by individuals who are

not family members shall be disregarded for the

purposes of this paragraph if their aggregate value

does not exceed five per cent of the net assets of the

family business

Provided further that other assets held by employees

who have been in continuous full-time employment

within the family business for over three years and

who are not family members shall be disregarded for

the purposes of this paragraph if their aggregate value

does not exceed ten per cent of the net assets of the

family business

Provided further that such a business shall abide by all

the provisions relative to unregistered organisations as

provided in the Civil Code, and the relative Schedule

thereto

Provided further that where any business assets are

held on lease, the family members are the majority of

the lessees in the lease agreement; and

(f) any other business as the Minister may prescribe.

(2) For the purposes of this article, a reference to shares,

interests or other assets, held indirectly by family members in the

business or contributions made to the business indirectly by family

members refers to those shares, interests or other assets held or

contributions made by

(a) holding companies which are at least 85%, as the case

may be, beneficially owned by family members; or

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(b) trustees of a trust set up for the benefit of family

members within the same family provided that other

beneficiaries who are not family members within the

same family shall be disregarded for the purposes of

this sub-article if they may not in aggregate benefit

from more than five per cent of the family business, or

if they are only residual beneficiaries who will benefit

from the trust only upon termination of the trust due to

the fact that there are no existing beneficiaries capable

of benefiting from the trust at any relevant point in

time

Provided that other beneficiaries who are employees

who have been in continuous full-time employment

within the family business trust for over three years

and who are not family members within the same

family shall be disregarded for the purposes of this

sub-article if they may not in aggregate benefit from

more than ten per cent of the family business, or if

they are only residual beneficiaries who will benefit

from the trust only upon termination of the trust due to

the fact that there are no existing family members

within the same family capable of benefiting from the

trust at any relevant point in time; or

(c) private foundations that are set up for the benefit of

family members within the same family provided that

other beneficiaries who are not family members within

the same family shall be disregarded for the purposes

of this sub-article if they may not in aggregate benefit

from more than five per cent of the family business, or

if they are only residual beneficiaries who will benefit

from the private foundation’s assets only upon

termination of the private foundation due to the fact

that there are no existing beneficiaries capable of

benefiting from the foundation at any relevant point in

time

Provided that other beneficiaries who are employees

who have been in continuous full-time employment

within the family business for over three years and

who are not family members within the same private

foundation shall be disregarded for the purposes of this

sub-article if they may not in aggregate benefit from

more than ten per cent of the private foundation, or if

they are only residual beneficiaries who will benefit

from the private foundation only upon termination of

the private foundation due to the fact that there are no

existing family members within the same family

capable of benefiting from the private foundation at

any relevant point in time

Provided further that where any business assets are

held on lease, the family members are the majority of

the lessees in the lease agreement.

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(1) For the purposes of this Act, shares or share capital of a

company shall mean

(a)

the issued share capital of a company;

(b)

the shares allow for rights to dividends;

(c)

the shares shall be voting shares; and

(d)

the shares shall allow for right to assets and profits

upon winding up.

(2) For the purposes of this Act, all other shares shall be

disregarded.

(1) An owner who is also a family member shall not have

in ownership or the beneficial interest

(a) in the case of a company, own, whether directly or

indirectly, more than eighty per cent (80%) of the

issued share capital of the family business; or

(b) in the case of a partnership en nom collectif or en

commandite contribute, whether directly or indirectly,

more than eighty per cent (80%) to the partnership’s

assets; or

(c) in the case of a trust be in a position where he may

benefit from more than eighty per cent (80%) of the

trust property; or

(d) in the case of a business carried out in partnership in

any other form, own, whether directly or indirectly,

more than eighty per cent (80%) of the business assets;

or

(e) in the case of indirect ownership, own more than

eighty per cent (80%) of the shares, interests, other

assets or contributions of the business.

(2) The percentage of eighty per cent (80%) shall be that

percentage that remains after deducting the percentage of five per

cent (5%) from the total contributions not owned by family

members and after deducting the ten per cent (10%) of the

contributions owned by employees of the business in accordance

with the provisos of article 3.

In the case of a trustee directly or indirectly holding a

family business, for the benefit of family members, registration for

the purposes of this Act shall be made after the declarations and

documents required in the First Schedule are delivered to the

Regulator by the duly licensed pro tempore trustee of the interests

in the family business being held under the trust.

(1) A business shall be a registered family business once it

has been accepted for registration by the Regulator in terms of

article 28.

(2) The family business may, upon a resolution of the holders

of shares or other participating rights or interests therein, request

the removal of the family business from the Register upon giving

three months notice to the Regulator and, in such case, the

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Regulator shall proceed to cancel the registration subject to the

issue of any orders under article 31 which he may consider

appropriate.

A registered family business shall clearly identify a

representative of the family business and make his contact details

available to the Regulator upon any change.

A registered family business shall notify the Regulator of

any change set out in article 3 within ten days from such change.

A business shall not qualify to be registered as a family

business if it has not been actively trading or in operation without

interruption for a minimum period of at least three (3) consecutive

calendar years.

(1) The intended objective of the benefits provided under

this Act are for the facilitation of the transfer of the registered

family business from the owners who are family members to other

family members within the same family.

(2) Transfers made by family members to family members who

are ascendants shall not be eligible for any of the benefits.

(3) Upon receiving benefits it shall not be possible for the

registered family business or the family member to transfer or

assign in whole or in part the benefits of an incentive granted by

virtue of this Act, to any other person or business.

(4) When a registered family business intends to apply for any

benefits in terms of this Act or any other law referring to family

businesses, the family business shall obtain the issue of an updated

certificate from the Regulator attesting that the family business still

qualifies as a registered family business in terms of this Act.

(5) The benefits in terms of the Duty on Documents Transfers

Act shall only be granted to a registered family business which has

all fiscal returns and contributions duly submitted up to the date of

the transfer and the tax due in terms of the Duty on Documents

Transfers Act has been paid in full before the transfer takes place.

(6) Any business shall only be eligible to benefit from any

incentive, benefit or scheme available to family businesses, that

may come into force from time to time, if it is duly registered as a

family business.

(7) When granting benefits to family businesses, the Government

or any other entity shall consult and may rely on the information

contained in the Register established in accordance with article 26 of

this Act.

When a registered family business is occupying industrial

government premises or land on lease or emphyteusis respectively

as prescribed under the Business Promotion Act and subject to the

business satisfying all the conditions of the tenancy agreement or

emphyteutical deed, the Regulator shall recommend to the Malta

Enterprise Corporation and, or Malta Industrial Parks to renew the

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tenancy, which renewal shall not be unreasonably withheld when

the objectives of the renewal are to ensure the continuity of the

family business between family members.

(1) A registered family business benefiting from an

incentive by virtue of its registration under this Act shall submit the

Annual Return found in the First Schedule to the Regulator by the

end of the calendar year. In default there shall be a penalty of

twenty-five euro (€25) for each month of delay. In the event of non-

compliance for a year, registration shall be duly cancelled and all

benefits shall be refunded and reimbursed immediately.

(2) The annual return for a family business shall cover a calendar

year from the first day of registration up until one year from the

registration date.

(1) Any acquisition of immovable property in respect of

which a benefit has been claimed pursuant to this Act must remain

within the registered family business for a minimum period of three

(3) years and in the event that such immovable property is

transferred they must be replaced with a similar asset used for the

same benefit of the registered family business or such other period

as the Regulator may approve.

(2) Any acquisition of shares, interests, contributions or other

assets in respect of which a benefit has been claimed pursuant to

this Act must remain within the registered family business for a

minimum period of three (3) years and in the event that such

shares, interests, contributions or other assets are transferred they

must be replaced with a similar share, interest, contribution or other

asset used for the same benefit of the registered family business or

such other period as the Regulator may approve.

(3) The owners of the registered family business must

undertake to trade and operate the family business during these

three (3) consecutive years without interruption immediately

following the granting of the benefits or such other shorter period

as the Regulator may approve and in the event that the business

ceases to exist in the said period, any benefit claimed shall be

refunded and reimbursed.

In the event that a registered family business which has

availed itself of and claimed any benefits does not remain

constituted and registered as a family business for a minimum

period of three (3) consecutive years as referred to in article 14, the

business shall make a refund of the benefits

Provided that where a business does not remain constituted

as a family business due to the unexpected death of a family

member, in those cases where the business is owned, whether

directly or indirectly, by only two family members, the business

shall not be required to refund the benefits acquired for the

previous transfer of the business

Provided further that the Regulator shall be informed by the

surviving family member within sixty (60) days from the date of

the deceased.

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(1) The Minister may by regulations prescribe the proper

implementation of the provisions of this Act.

(2) The Minister may also by regulations amend the Schedules

to this Act.

Part III

The Regulator

(1) There shall be a Regulator for Family Businesses who

shall be appointed by the Minister for the purpose.

(2) The Regulator shall be appointed for a period of three years

and may be re-appointed upon expiration of the term of office for a

further period or periods

Provided that during his term as Regulator, such person

shall not hold any position which results in a conflict of interest or

is incompatible with the correct performance of his official duties

as Regulator or with impartiality expected from this office or with

public confidence therein.

(3) The Regulator shall receive such remuneration as the

Minister may establish.

(4) When the office of the Regulator becomes vacant, a person

appointed as Regulator shall hold office temporarily until a

successor is appointed. The Minister may, at any time, during the

absence of the Regulator or for any other temporary purpose where

the Minister considers it necessary to do so, appoint a person to act

in the office of the Regulator, until the resumption of office of the

Regulator.

(5) The Regulator shall be provided with premises and an

adequate number of officials and staff to carry out the functions

assigned to him under this Act.

(6) The Minister may also appoint one or more Deputy

Regulators to assist the Regulator as directed by him and in the

performance of his functions

Provided that the Deputy Regulators, officials and staff

appointed to assist the Regulator shall receive such remuneration as

the Minister may establish.

(1)

The Regulator shall have a separate and distinct legal

personality and shall be capable, subject to the provisions of this Act,

of entering into contracts, of acquiring, holding and disposing of any

kind of property for the purposes 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, including the lending or

borrowing of money

Provided that the Regulator shall not have the power to

(a)

borrow or lend any monies except with the

authority and concurrence in writing of the Minister and

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Minister responsible for finance; or

(b)

enter into any form of commercial partnership in

furtherance of its functions or otherwise, unless authorized to do

so in writing by the Minister; or

(c)

delegate any of its functions in a manner other than

that established by or under this Act.

(2)

The legal representation of the Regulator shall vest in the

Regulator himself

Provided that the Regulator may appoint any one of its officers

or employees to appear in the name and on behalf of the Regulator in

any judicial proceedings and in any act, contract, instrument or other

document whatsoever.

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

remain, a Regulator if he

(a) is a presiding judge or magistrate; or

(b) is adjudged bankrupt or has entered into any

arrangement with his creditors; or

(c) is interdicted or incapacitated; or

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

or fraud or of knowingly receiving property obtained

by theft or fraud; or

(e) is subject to a disqualification under article 320 of the

Companies Act; or

(f) is a public officer or becomes a public officer.

(1) The Regulator shall only be removed or suspended

from office by the Minister on the grounds of proved inability to

perform the functions of the office of the Regulator or proved

misbehaviour.

(2) The Regulator may, at any time, resign from office by

notice in writing to the Minister.

(1) The Regulator shall assess all applicants seeking to

register as a family business under this Act and, once registered,

ensure their ongoing compliance with the relevant requirements

and regulations made hereunder to his satisfaction.

(2) The Regulator shall perform the duties and exercise the

functions imposed and conferred on him by this Act and by any

regulations made thereunder including

(a) accepting or refusing applications from businesses to

register as family businesses in terms of this Act;

(b) provide registration facilities for businesses which are

eligible for enrolment in terms of this Act;

(c) keeping and updating the register of registered family

businesses;

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(d) monitoring the activities of registered family

businesses in order to ensure that they comply where

applicable with the provisions of this Act and or, any

regulations and or any guidelines as prescribed;

(e) where eligible, providing the registered family

businesses an updated registration certificate attesting

that the business still qualifies as a family business in

terms of this Act;

(f) providing family businesses with information and

guidance about the requirements, benefits and

responsibilities in connection with registrations and

enrolments in terms of this Act;

(g) making recommendations to the Minister on

legislation and policies in support of the family

business sector;

(h) assisting government, government departments, public

agencies, authorities and entities controlled by the

Government in preparing and reviewing policies in

support of family businesses;

(i) investigating written grievances in relation to this Act

relating to registered family businesses or businesses

purporting to be registered family businesses under

this Act, and furthermore to investigate ex officio any

registered family business for any shortcoming and to

take such action as is in his power to redress any

justified grievance that may come to his notice and

including if he deems fit, to refer his findings to the

police;

(j) encouraging and promoting the family business sector by

communicating, disseminating and making contact with

relevant parties about news and information relevant to

the sector;

(k) encouraging family businesses to consider the benefits

of entering into written agreements concerning the

principles of governing the family business;

(l) co-ordinating and communicating with any competent

authority with a view to facilitating the registration

and enrolment processes for family businesses;

(m) performing any other function or duty that is assigned

to him by the Minister under this Act and any

regulations made thereunder as well as such other

functions as may be assigned to him under any other

law.

(3) In the exercise of his functions, the Regulator shall act

impartially and shall not be subject to the direction of any other

person or authority.

(4) The Regulator may, by writing under his hand, delegate to

any person in the office of the Regulator, specific functions, powers

or authorities assigned to or conferred on him by this Act or any

other law, and may at any time revoke or vary such delegation

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Provided that no such delegation shall be deemed to divest

the Regulator of any of his functions, powers or authorities and he

may, if he thinks fit, exercise such functions, powers or authorities

collaterally with the person so delegated.

The provisions of article 77 of the Public Finance

Management Act shall not apply to the Regulator or any other

person carrying out his functions in terms of this Act.

(1) The Regulator may request any information from any

government entity, public authority or department in order to fulfil

his duties.

(2) Any competent authority shall co-operate with the

Regulator as required in the performance of his functions under this

Act

Provided that the Regulator may require the submission of

any documentation from any competent authority.

(3) A demand under this article may also be sent to a person

who is bound by a duty of professional secrecy under the

Professional Secrecy Act and for the purposes of article 6A of such

Act, the Regulator shall be considered to be a public authority. Any

information obtained by the Regulator upon such a demand shall be

used exclusively for the purposes of this article.

The Regulator may, from time to time, issue guidelines in

relation to the activities of registered family businesses and any

breach or declaration from these guidelines shall be a consideration

for the family business to have their registration certification

cancelled.

Any registered family business not compliant with any

rules and regulations under any other Act or legislation may be

cancelled at the discretion of the Regulator.

(1) The Regulator shall, by not later than eight weeks after

the end of each calendar year, prepare and present to the Minister

an annual report which shall include

(a) a report of the Regulator’s office activities during the

preceding year;

(b) a general description of the circumstances of family

businesses in Malta and any developments which may

affect the sector;

(c) any

recommendation

regarding

legislation,

regulations, policies or other matters affecting the

family business sector; and

(d) accounts and other financial records referred to in this

Act.

(2) The Regulator shall cause to be kept proper accounts and

other financial records in respect of the operations of his office, and

shall cause to be prepared a statement of accounts in respect of

each financial year. After the end of each financial year, and not

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later than the date on which the report in sub-article (1) is to be

forwarded to the Minister, the Regulator shall cause a copy of the

statement of accounts duly audited to be transmitted to the Minister

together with a copy of any report made by the auditors on that

statement or on the accounts of the office of the Regulator.

(1) There shall be a Register of Family Businesses which

shall be maintained by the Regulator and shall contain information

and data relevant to the registration process as applicable, as found

in the First and Second Schedule, supported by the documentation

referred to in the Schedules.

(2) Upon registration, the Regulator shall allocate a unique

registration number to the family business which shall be preceded

by the letters "FB" which registration number shall be known

hereinafter as the Family Business Number" and the family business

number may be quoted by the registered family business on any

published materials, letters, notices, advertisements and other

documents issued by such business.

(3) A list of the names of the family businesses in the Register

will be available upon written request. No other information or

contents of the Register other than the name of the family business

will be available for disclosure except to the competent authorities

granting benefits as referred to in the Act.

The Regulator shall, for the purposes of this Act, compile

and maintain the Register subject to the provisions of the Data

Protection Act.

(1) For a family business to be registered as such, tan

application with any required documents shall be submitted to the

Regulator who shall determine, to his satisfaction, whether the

application complies with the provisions of this Act.

(2) A business may apply for registration by submitting the

prescribed application form provided by the Regulator.

(3) A non-refundable administration fee shall be submitted

with every application irrespective of the outcome of the

application.

(4) In considering an application, the Regulator may request

the applicant to provide further information about the business or

make representations on any matter on which he may have

reservations or concerns in relation to the application.

(5) The Regulator may accept or refuse any application for

registration on the basis of any of the following

(a) the non-observance or otherwise of all the formalities

required by this Act and as may be prescribed;

(b) the legality or otherwise of the purpose and objectives

of the business that is not in compliance of the law or

ethics in relation to its business activities;

(c) the fulfilment or otherwise of obligations relating to

the payment of social security contributions in

accordance with the applicable laws;

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(d) the business has not fulfilled its obligations relating to

the payment of taxes due in accordance with the

applicable law; or

(e) the business has not supplied the information required

under these regulations or has incorrectly supplied

them.

(6) Where the Regulator requires proof from the applicant that

none of the cases quoted in sub-article (5)(c), (d) and (e) have been

met, it shall accept, as sufficient evidence, relevant certification

issued by the administrative body in the country of origin or the

country whence that person comes showing that these requirements

have been met.

Certificates of registration shall be deemed to be public

documents and shall be surrendered to the Regulator on his simple

demand in writing stating the reasons for such request.

The Regulator may request from the registered family

business any information and any clarification, and may also carry

out any verification required so as to ascertain to his satisfaction

that such business is in compliance with the provisions of this Act

or any rule, regulation or guideline made thereunder. The registered

family business shall seek to comply with this request expediently

and in default the Regulator may cancel the certificate of

registration.

(1) The Regulator may order the cancellation of the

registration of a family business by the issue of a cancellation

order, which shall come into effect immediately.

(2) A cancellation order may be issued, at the discretion of the

Regulator, if the registered family business

(a) is not compliant with the criteria, where applicable, in

the First and Second Schedule or any other provisions,

rules, regulations and guidelines in accordance with

this Act; or

(b) has not functioned, operated, traded or carried on

business for a period which exceeds twelve

consecutive months without interruption or earlier as

the Regulator deems fit; or

(c) has obtained registration on the basis of materially

incorrect or incomplete information that would have

otherwise resulted in a refusal had the correct or

complete information been known to the Regulator; or

(d) is not seeking to uphold and maintain the objectives of

this Act; or

(e) the certificate of registration has been used in an

incorrect manner or a forgery thereof has been

committed.

(3) Prior to ordering the cancellation of the registration of a

family business by the issue of a cancellation order, the Regulator

shall inform the business in writing of his intentions to issue a

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cancellation order. The Regulator shall grant the business a period

of time to give reasons why the cancellation order should not be

issued. Following this the Regulator may grant the business a

period of time in which to regularise its position and conform to the

provisions of this Act. If the business does not do so within this

stipulated time period, which may be extended by the Regulator at

his discretion, the Regulator shall order the cancellation of the

registration of the family business in accordance with sub-article

(1).

(4) The Regulator shall notify and publish, in the Gazette, any

cancellation order which has become final and shall notify all

competent authorities accordingly.

(5) The registration of a family business shall terminate ipso

jure if the business is struck off, or ceases to operate, function,

trade or carry on business under any form.

(1) In the event of cancellation of registration of a family

business, the family members shall forthwith surrender, to the

Regulator, the certificate of registration of such business and any

person failing to surrender such certificate within the time stated as

notified by the Regulator, shall be liable to an administrative fine

of two hundred and fifty euro (€250).

(2) In the event of cancellation of registration of a family

business, all benefits granted to such business by virtue of

registration, shall cease to have effect from the date when the

decision to cancel takes effect.

(3) Cancellation for the reasons mentioned in article 31(2) shall

require the business to refund any benefits received by the business

or any other individual by virtue of its registration in terms of this

Act unless provided otherwise in this Act, and the Regulator may

issue the relative orders against the business and any persons

involved in such business

Provided that when the demand for the refund of any

benefits is made by the Regulator by judicial letter issued in

accordance with article 466 of the Code of Organization and Civil

Procedure, this shall constitute an executive title against the

business or any named family member of administrator in favour of

the Regulator, in his own or as trustee for the person entitled to the

refund as aforesaid.

(4) An order of the Regulator against a family business or any

named family member shall be enforceable as an executive title

once any judgment has become res judicata or no proceedings have

been filed within the relevant time limits.

Part IV

Offences

FAMILY BUSINESS

(1) Any person or business who in order to obtain and

maintain the status of a family business -

(a) in any manner, forges or alters a certificate of

registration so as to give the impression that he acts on

behalf of a registered family business shall be guilty of

an offence and shall be liable to the same punishment

as provided for in article 183 of the Criminal Code;

(b) who falsely misrepresents the registered family

business or makes false representations shall be guilty

of an offence under this Act;

(c) who, in any manner, makes an abusive use of a

certificate of registration or the Family Business Label

shall be guilty of an offence under this Act;

(d) who without reasonable excuse prepares any incorrect

statement or gives any incorrect information in

relation to any matter falling under this Act, shall be

guilty of an offence under this Act.

(2) Any persons or business who is found guilty of any offence

under sub-article (1) shall be liable on conviction to a term of

imprisonment from thirteen months to four years.

(3) Upon any person or business admitting to or being found

guilty of any of the above offences, the Regulator shall on

conviction revoke any Certificate of Registration issued to the

family business.

(4) The Regulator shall issue public statements on the facts to

warn the public about any abuse by any person or business.

(1) Any person or business who wilfully with intent to

obtain any benefit under this Act or regulations made under this

Act or to assist any other person to do so

(a) omits from a return or any other document or

statement made, prepared or submitted for the

purposes of or under this Act, any matter which should

be included therein; or

(b) makes any false statement or entry in any return or

other document or statement prepared or submitted for

the purposes of or under this Act; or

(c) gives any false answer, whether verbally or in writing,

to any question or request for information asked or

made in accordance with the provisions of this Act; or

(d) prepares or maintains or authorises the preparation or

maintenance of any false books of account or other

records or falsifies or authorises the falsification of

any books of account or records; or

(e) makes use of any fraud, art or contrivance or

authorises the use of any such fraud, art or

contrivance,

shall be guilty of an offence, and shall for each such offence be

liable on conviction to a fine (multa) of not less than two thousand

FAMILY BUSINESS

euro (€2,000) and not exceeding twelve thousand euro (€12,000) or

to imprisonment for any term not exceeding four years, or to both

such fine and imprisonment.

(2) Upon any person admitting to or being found guilty of any

of the above offences, the Court may, on conviction, revoke any

certificate issued to the registered family business.

If any person or business contravenes or fails to comply

with any of the requirements of this Act or of any regulations made

thereunder, in respect of which no specific penalty is provided, he

shall be guilty of an offence and shall for each offence be liable, on

conviction, to a fine (multa) of not less than two hundred and fifty

euro (€250) and not more than one thousand and five hundred euro

(€1,500).

The provisions of this Act establishing offences and

penalties in respect thereof shall not affect the operation of any

other law establishing offences and penalties in respect of the same

acts or omissions and shall not affect the application of any higher

penalty under any other law.

Proceedings for an offence under this Act may be

commenced at any time within five years from the date of

commission of the offence upon the complaint of the Regulator.

First Schedule

(Article 13)

Annual Return

1. Purpose.

The purpose of this annual return is to provide the Regulator

and any related competent authority with up to date

information about the registered family business, benefiting

from incentives by means of this Act.

2. Content and Form.

The content and form of the annual return that each family

business shall duly file with the Regulator annually is as

follows

Contents and Form of Annual Return of a registered family

business

(a)

Annual Return of .............. (insert official name

of business)

(b)

Family Business Number

(c)

Name and Designation of Contact Person

FAMILY BUSINESS

(d)

Any changes to the family business structure

undertaken in the last year

Declaration of Completeness and Correctness

We hereby confirm that the details provided are complete

and truthful as to their contents.

Signature of Family Business Representative

Name and Surname

Date

Second Schedule

(Article 13)

Deleted by Act XXXVII of 2018.