Working in Malta: a Detailed Guide to Corporate Immigration

Jean-Philippe Chetcuti & Priscilla Mifsud Parker, Chetcuti Cauchi Advocates

With a Maltese labour supply that’s almost fully employed, foreign workers are necessary in order for the country to meet its economic needs. Jean-Philippe Chetcuti and Priscilla Mifsud Parker from Maltese law firm Chetcuti Cauchi Advocates pen a guide to corporate immigration, detailing the ins and outs of employment immigration in Malta.

Chetcuti

Chetcuti

Malta, a member of the European Union since 2004, has in place several multilateral agreements with countries, to facilitate the movement of people for employment purposes. Under the Treaty on the Functioning of the EU, every EU citizen has the right to live and work in another member state. This right protects EU citizens from discrimination when compared to nationals of the member state in which they work.

Malta implements all the rights of EU citizens, including the principle of freedom to provide services, so that a non-EU national who is employed by a company in one EU country must be allowed to provide services to a company in another EU country for a limited period without the need for a work permit. Under the EEA agreement, all these rights are also broadly extended to citizens of Norway, Iceland, Liechtenstein and Switzerland.

Malta is part of the Schengen area, a visa-free area with no internal border controls made up of 22 EU member states and four additional European countries: Iceland, Liechtenstein, Norway and Switzerland and also EFTA member states.

The visa facilitation agreements currently in force between the EU and certain third countries apply also to Malta. These agreements have been signed with Albania, Bosnia and Herzegovina, Macedonia, Georgia, Moldova, Montenegro, Serbia, Russia, and Ukraine. These agreements focus on facilitating procedures to obtain visas, reduce visa fees, issuance of multiple-entry visas for specific categories of applicants, and shorter processing times.

The authorities that administer corporate immigration in Malta are the Central Visa Unit and the Department of Citizenship and Expatriate Affairs, both forming part of the agency Identity Malta. Employment licences are then handled by Jobs Plus, while other employment-related issues are dealt with by the Department for Industrial and Employment Relations (including posted workers).

Visiting Malta for business

Third-country nationals (TCNs) travelling to Malta for business purposes still require a visa to enter the country, unless one is coming from the US where a US visa waiver programme exists and therefore no visa is required. Apart from this, Annex 1 of the Visa Code (found in the EU Legislation) lists a number of nationalities that do not require a visa to enter Malta for whatever purpose. An entry visa is issued or refused depending on various criteria including the supporting documents submitted, the outcome after the applicant is interviewed, previous visas issued and refused, previous hosts, and the purpose of the visa.

TCNs on a business visit who are visa-exempt can remain in the Schengen area for a maximum of 90 days within a 180-day period. Visitors with a business visa are able to attend conferences and undertake business meetings, market studies and other business activities. Business visitors can also receive short-term training. The Schengen visa is not valid as a work permit and does not allow the holder to work in Malta. To be able to work in Malta, one needs an employment licence issued by Identity Malta and Jobs Plus

Business visitors working or providing a service for a temporary period

A non-EU national employed by a company in one EU country must be allowed to provide services to a company in another EU country for a limited period without the need for a work permit. A TCN worker must be employed by a posting undertaking that is established in an EU/EEA country. Such posted worker must hold an employment licence issued in the country where the undertaking which is posting the worker is established.

The undertaking posting the worker must notify the Department of Industrial and Employment Relations (DIER) of its intention to post a worker in Malta. If the worker already holds a Schengen residence permit, he or she can enter Malta without applying for a visa. If, on the other hand, the worker holds a residence permit issued by a non-Schengen country, he or she must apply for the relevant visa at the Maltese Embassy or Consulate in the country of residence.

Compliance and illegalities

The authorities in Malta operate a system of compliance inspections of employers who regularly employ foreign nationals. The Law Compliance Unit at Jobs Plus plays an important role in identifying abuses by taking action against foreigners working without the required employment licences and against employers who fail to notify the employment corporation on employing a new employee.

A freephone number and an online form are available to the public, where individuals can report on illegal work. Inspections are made to follow up anonymous hotline reports and routine inspections are also conducted, either by business sector or by area. Jobs Plus has the legal authority to enter freely without notice any premises or place of work, to carry out examinations, tests, investigations and to interrogate the employer or the employees on any alleged illegalities.

Penalties

Any employer who employs any person who is not a citizen of Malta (or of another member state), other than such person as may be in possession of a work permit, shall be guilty of an offence and shall be liable on conviction to a fine of not less than €116.47 and not exceeding €1,164.69, and the Court may, in addition, order the suspension or cancellation of any licence held by the offender and relating to trade or business, or relating to any business premises where the persons are employed.

Such instances are also reported to the Immigration Police as they constitute a violation of the provisions of the Immigration Act and the employer would be subject to prosecution and penalties while the foreign national concerned may be removed from Malta.

Employers found guilty of illegally employing TCNs will be barred from applying for any new or renewed licence for 12 months.

Corporate Immigration - Registration of Employers

In order for an employer to hire employees of any nationality, they need to obtain a PE Number and register with the Department of Inland Revenue as an employer. This is the first step to enable the employer to withhold, remit and report the income tax and national insurance of employees according to the final settlement system (FSS). Every employer in Malta needs to register via the Private Employer Registration Form within 15 days from when the first salaries, to be paid by him to his employees, are due. For hiring foreign nationals, a separate registration is not required.

The employer is obliged to make sure that all TCNs employed with them have a valid employment licence and that this is renewed annually. The employer is also obliged to inform the authorities of any changes in the status or personal details of any employee, apart from ensuring they remain in compliance with payments due as National Insurance and tax through the FSS. The FSS is a tax deduction methodology designed to produce accurate tax deductions, ensuring that tax is deducted from employees’ emoluments and the relevant amounts are paid to the Inland Revenue Department and Social Security Department respectively.

Regulated Professions and Tax Incentives

The authorities provide a list of what are known as “regulated professions”, which would involve a more thorough analysis of the documentation required for the employment licence application.

Jobs Plus takes into account the situation of the labour market before making a determination about a particular employment licence, and for certain sectors the documentation required is different or the procedures more stringent. In cases where demand for jobs is high such as the hospitality, catering and IT industries, the Agency accepts foreign nationals without the employer having to justify it on the grounds that they couldn’t find EU/EEA or Maltese nationals.

In the case of applications for highly qualified employment, applications will generally be considered favourably, albeit in line with the labour market situation. To be treated as highly qualified employment, applications must illustrate clearly that certain conditions will be met by the TCN concerned, which include the following:

  • he or she must hold qualifications at ISCED6 levels 5a, 6 or above, which must be validated by the Malta Qualifications Council;
  • he or she must hold any documents necessary in the case of regulated professions; and
  • he or she must have an offer of a job which may be considered highly qualified employment, and which involves the payment of at least 1.5 times the average gross annual salary as defined in the most recent Labour Force Survey issued by the National Statistics Office.

The Inland Revenue Department in Malta also offers tax incentives under the Highly Qualified Persons Rules, such as a flat rate of taxation on employment income. This attracts highly qualified persons in particular sectors, and therefore when the application for an employment licence is made by a TCN for these occupations, the authorities will consider the application favourably. The Highly Qualified Persons Rules apply to financial services, gaming and aviation.

With respect to family members of diplomats stationed in Malta, applications are referred to the Ministry of Foreign Affairs in view of the possible existence of reciprocity agreements. Where no such agreements are in place, applications are subject to labour market considerations.

In the case of home-based carers, applications are currently not subject to a labour market test. However, a medical certificate declaring that the applicant requires a full-time carer to meet his/her daily needs must be submitted with the application.

In respect of culture and entertainment, the employer does not need to provide evidence of a search for EEA/Swiss/Maltese candidates. He or she does, however, have to elaborate, in the covering letter, on the reasons for the choice of the TCNs concerned.

In respect of steel fixers, form-work erectors and concrete shutterers, evidence of work contracts is necessary. Employers may be required to actively participate in open days at Jobs Plus and to interview suitable EEA/Swiss/Maltese candidates on request. Failure to do so may result in the non-issue of employment licences and/or the revocation of current ones.

In respect of cleaners and room attendants, evidence of work contracts is necessary. Employers may be required to actively participate in Jobs Plus recruitment drives, and to interview suitable EEA/Swiss/Maltese candidates on request. Failure to do so may result in the non-issuance of employment licences and/or the revocation of current ones. In respect of chefs in restaurants offering ethnic cuisine, the policy is as follows (the prior approval of the Malta Tourism Authority is required in each case):

  • outlets with up to 30 covers may apply for up to two TCNs;
  • outlets with up to 100 covers may apply for up to three TCNs; and
  • outlets with over 100 covers may apply for up to four TCNs.

Applications from employers that engage the services of EEA/Swiss/Maltese nationals as part of their staff complement will assist in the favourable consideration of an application.

In respect of sportspersons, Jobs Plus will obtain the prior approval of the Malta Council for Sports. In the case of footballers, a copy of the contract of work submitted to the Malta Football Association would need to be submitted with the application for the issuing of a licence.

In respect of foreign minors applying to work in film productions, these applications are referred to the discretion of the DIER and a licence given on DIER’s consent.

Jobs Plus adopts a less bureaucratic procedure for intra-company transferees - employees of foreign companies posted in Malta for no longer than one year to render a specialised service or training to Maltese employees.

Quotas

There are currently no annual quotas for employment-related work permits or visas. Moreover, there are no restrictions on the number of foreign workers an employer may sponsor. In each application the authorities will conduct a labour market test in order to determine whether the post can be filled by a Maltese or an EU/EEA national. There are certain posts (such as cleaners or waiters) where, due to a lack of local workforce, this labour market test is not conducted and the employer is free to employ TCNs.

Language Proficiency

TCNs sponsored to work in Malta would be required to show English-language proficiency if it is also a requisite of the relevant area of employment.

Medical Examinations and Insurance

TCNs coming from high-risk TB countries require health clearance. On receiving an application, Jobs Plus sends a health form to the employer, so that clearance is first obtained from a health centre. In the case of TCNs already in Malta at the time of application, health clearance is to be obtained before the employment licence can be issued. In the case of TCNs still abroad when the application is submitted, health clearance is to be presented to Jobs Plus within three months of the employment licence being issued, or of their entry into Malta. If such clearance is not presented, the licence will be revoked and the immigration authorities will be alerted accordingly.

It is necessary for an employer to take out private health insurance for employees who are sponsored to work in Malta, to cover the full duration of employment. The employer is to provide a copy of the receipt for the insurance premium within three months from the licence being issued; failing this, the licence will be revoked. Such health insurance is not required for home-based carers; those working with persons with disability or persons needing constant care; or TCNs working in the public service.

Secondment

Employees holding a work permit in Malta can be seconded to a client site, provided they are still directly employed by their original employer. The work permit in Malta is strictly tied to the specific employer, and a new work permit should be applied for whenever the employee is employed by a new company.

Investment or Establishment Work Permits

There are categories of work permits that are issued on the basis of investment in Malta. These are the self-employed work permit and the work permit for a shareholder or ultimate beneficial owner of a company.

In order to qualify for self-employed status, a TCN must meet one or more of the following criteria:

  • He or she must make an investment in Malta of capital expenditure of at least €500,000 within six months of the licence being issued. The capital expenditure shall solely consist of fixed assets (such as immovable property or plant and machinery) used for the business purposes as indicated in the business plan submitted with the application and needs to be supported by receipts.
  • Highly skilled innovators must submit a sound business plan whereby they commit to recruit at least three EEA/Swiss/Maltese nationals within 18 months of establishment.
  • He or she must be sole representative of an overseas company (with a sound reputation and established for at least three years abroad).
  • He or she must be leading a project that has been formally approved by Malta Enterprise and formally notified to Jobs Plus.

 Applications containing a firm commitment to the engagement of EEA/Swiss/Maltese nationals as part of the staff complement will be considered favourably.

Where the Malta-resident company is applying for an employment licence to employ its shareholder or ultimate beneficial owner, the applicant must meet one or more of the following criteria:

  • Every TCN shareholder must have a fully paid-up share capital of at least €500,000, which may not be redeemed, reduced or transferred to a third party during the first two years following the issuance of the employment licence.
  • He or she must have made a capital expenditure of at least €500,000 that is to be used by the company. Capital expenditure shall solely consist of fixed assets (such as immovable property, plant and machinery) used for business purposes as reflected in the business plan submitted with the application. Rental contracts do not qualify. Such expenditure needs to be supported by receipts in the company’s name.
  • The company must be a sole representative of an overseas company (with a sound reputation and established for at least three years abroad) wishing to open a branch in Malta. Evidence of representation is required.
  • The company must be leading a project that has been formally approved by Malta Enterprise, which must formally notify Jobs Plus.

Applications containing a firm commitment to the engagement of EEA/Swiss/Maltese nationals as part of the staff complement of the company will be considered favourably.

Temporary Work Permits

All Maltese work permits are temporary, issued for a maximum of one year by Jobs Plus.

Employment licences are only issued in respect of workers who will normally or habitually be carrying out work in Malta (for more than six months in a year). An employer who wishes to employ someone who will carry out his or her work primarily in another country need not apply for an employment licence.

An undertaking established in an EU member state other than Malta may send a posted employee (who does not normally work in Malta but who for a limited period of time is sent by the foreign undertaking to work in Malta) on their account and under their direction, under a contract concluded between the undertaking making the posting and the party for whom the services are intended, provided there is an employment relationship between the undertaking making the posting and the worker during the period of posting. The nature of this employment would be a temporary undertaking, or via a placement agency hiring a worker to a user undertaking that is established or operating in Malta.

Furthermore, foreign nationals who are non-resident in Malta, and non-executive directors of Malta-resident companies who satisfy the below conditions, do not require an employment licence:

  • they do not ordinarily reside in Malta;
  • they do not have an employment relationship with the company; and
  • they are in receipt of a director’s remuneration but not in receipt of a salary.

There is no specific immigration category catering for exchanges, career development, internships or other non-economic purposes.

Group or intra-company transfer work permits

A foreign undertaking may send posted employees to an establishment or an undertaking in Malta that is owned by the foreign undertaking. This would fall under the posted worker rules that cater for all posted worker scenarios, and not just where the undertakings are concerned. Posting of workers in Malta is regulated by Legal Notice 430 of 2002 – Posting of Workers in Malta Regulations. These regulations apply to foreign undertakings that:

  • send posted employees to Malta on their account and under their direction, under a contract concluded between the undertaking making the posting and the party for whom the services are intended, provided there is an employment relationship between the undertaking making the posting and the worker during the period of posting;
  • send posted employees to an establishment or to an undertaking in Malta that is owned by the foreign undertaking, provided there is an employment relationship between the undertaking making the posting and the worker during the period of posting; or
  • constitute temporary employment undertakings or placement agencies, hiring out a worker to a user undertaking established or operating in Malta, provided there is an employment relationship between the temporary employment undertaking, or placement agency, and the worker during the period of posting.

In these cases, the employee who is posted from an EU/EEA country is not required to apply for an employment licence in Malta.

Qualifying for and obtaining a work permit

For an undertaking in Malta to obtain a work permit, it must be owned by the foreign company. If the employee is posted from an EU/EEA country, the undertaking is not required to apply for an employment licence in Malta.

In the case of a TCN employee who is employed by a posting undertaking that is established in an EU/EEA country, there is no need to go through an employment licence procedure in Malta if such posted worker already holds a licence issued in the country where the posting undertaking is established.

For any foreign national who is posted in Malta by an undertaking established outside an EU/EEA country, an employment licence is required to be issued by Jobs Plus.

For an employee posted to Malta, the undertaking posting the worker is obliged to notify the DIER of its intention to post a worker in the country. The notification form – accompanied by a copy of the posted worker’s employment contract (with the posting undertaking) and, in the case of a TCN posted from an EU/EEA country, a copy of his or her existing working licence – should reach the DIER prior to the commencement of the posting. The undertaking that is making use of the services of the posted worker is obliged to keep a copy of the notification form at the place of work for the purposes of monitoring by DIER inspectors.

Obtaining a visa under the intra-company group transfer category

If the worker already holds a Schengen residence permit, he or she can enter Malta without applying for a visa. If, on the other hand, the worker holds a residence permit issued by a non-Schengen country, he or she must apply for the relevant visa at the Maltese Embassy or Consulate in the country of residence.

The initial visa process normally takes from seven to 10 days, subject to further checks conducted by the relevant authorities.

TCNs wishing to enter Malta in order to work and/or study must be in possession of a national long-stay “D” visa for periods longer than 90 days.

Employees coming under the intracompany transfer route can apply for long-term residence in accordance with the procedure explained below.

New hire work permits

Malta has in place the EU single application procedure for a single permit for TCNs to reside and work in the territory of a member state and on a common set of rights for third-country workers legally residing in a member state. The single permit application is the most common path taken to employ TCNs in Malta. Single permit is a process that leads to receipt of an e-residence card: that is, a combined employment licence and residence permit. The EU Directive regulating the single permit leaves outside of its scope certain categories of employees (posted workers, intercorporate transferees, workers with special humanitarian status and others); such categories should first seek to obtain an employment licence and then, on the basis of this, a residence permit.

Labour market testing

Jobs Plus undertakes labour market testing after receipt of either the employment licence application or the single permit application. No input from the prospective employee or employer is needed.

For holders of a permanent resident permit, home-based carers, cleaners, IT professionals and catering employees, the labour market test does not have to be carried out. Highly qualified employment applications are also generally considered favourably. In respect of culture and entertainment, the employer does not need to provide evidence of a search for EEA/Swiss/Maltese candidates. In respect of family members of diplomats stationed in Malta, applications are referred to the Ministry of Foreign Affairs of Malta in view of the possible existence of reciprocity agreements.

Place of residence

Applications for obtaining a work permit for a new hire may be submitted either while the TCN (prospective employee) is residing in Malta or while he or she is abroad, provided that if the person is in Malta or the EU, he or she is legally residing therein.

If the TCN is residing legally in Malta, the application, together with supporting documentation, has to be submitted personally, and during that visit biometric data will be taken. The person is required to proceed to the Department for Citizenship and Expatriate Affairs for such purpose.

If the person is still residing abroad, the application and all documentation relating to it have to be submitted by post. If the application is accepted, he or she will be notified of the outcome, and in the case that it is approved following his or her arrival in Malta, he or she will be required to proceed to the Department for Citizenship and Expatriate Affairs in order that the relevant biometric data is taken, and the applicant is issued with the residence permit in question. Applicants wishing to be admitted to Malta in order to work here, those already residing in Malta or those wishing to renew their authorisation to work are required to submit a Form C.

The process to obtain an inter-company transfer visa

In terms of the application for an employment licence, there is no special treatment of inter-company transferees. Their prospective employers must apply directly to the employment authority (Jobs Plus) for employment licences. Inter-company transferees are excluded from the scope of the Single Permit Directive.

The Maltese authorities shall issue a decision on the complete employment licence application as soon as possible, and in any event within four months of the application being lodged.

This refers to obtaining permission to work in Malta. If the prospective employee is still outside Malta, he or she needs to apply for an entry visa, which might take anywhere from five days to three months depending on the nationality of the applicant.

Extending visas

Visas are granted for a period of 90 days. Upon arrival in Malta, the employee is obliged to apply for a residence permit on the basis of employment. The residence permit will be issued in four to eight weeks and will cover the whole period of validity of the employment licence.

An employee may extend his or her residence in Malta on the basis of various factors other than employment, for example self-sufficiency. However, residence and employment are treated as separate matters. Should the employee seek to renew his or her employment licence, then a labour market test will be applied again.

Employees can apply for long-term residence after five years of holding an employment licence in Malta and five consecutive years of residence in Malta.

Conditions of stay for work permit holders

An employment licence obliges the employee to apply for a Maltese e-residence card within three months of arrival in Malta. The card is equivalent to a Schengen residence permit and serves as an identity card for the Maltese islands. An employment licence holder is considered a Maltese resident in terms of the Malta Immigration Act.

Automatically, by virtue of the application for an e-residence card, permit holders are also registered with municipal authorities or the police.

Dependants

Dependants can apply for an e-residence card by filling in Form G. The employee must prove that they receive a gross income of at least €17,000 and an additional €3,000 for each family member.

Family members of long-term residents (LTRs) who acquire a residence permit under the Family Reunification Regulations are entitled to apply for an employment licence to work in Malta. From the 13th month after reunification, family members of LTRs are entitled (in the same way as the LTR) to access to employment and self-employment, without the need for labour market considerations. In this instance, “family members” refers to:

  • the LTR’s spouse who is aged 21 or over;
  • the unmarried minor children of the LTR and of his spouse, including children adopted in a manner recognised by Maltese law; and
  • the unmarried minor children, including adopted children, of the LTR or of the spouse, as the case may be, where the sponsor or the spouse has custody and the children are dependent upon him or her.

Civil/unmarried or same-sex partners qualify as family members for civil law purposes.

Spouses and partners have access to the labour market when they are admitted as dependants, provided they satisfy all the conditions mentioned above.

Generally, children do not have access to the labour market, with some exceptions in the case of professional entertainers.

Permanent Residence

In order to obtain long-term residence, one has to submit an application and must satisfy the following conditions for the grant of such status:

  • The applicant must have resided in Malta for a period of at least five consecutive years.
  • The absences from Malta must be shorter than six consecutive months and must not exceed a total of 10 months within the five-year period.

When applying for long-term resident status the applicant would need to provide evidence that he or she has:

  • stable and regular resources that are sufficient to maintain him or herself and the members of his or her family without recourse to the social assistance system in Malta or to any benefits or assistance of any type payable under the Social Security Act;
  • appropriate accommodation – that is, not shared with any other person, or persons not being family members, regarded as normal for a comparable family in Malta and which meets the standards published via a notice in the Gazette by the Ministry responsible for housing;
  • sickness insurance in respect of all risks normally covered for Maltese nationals for him or herself and the members of his or her family;
  • a valid travel document; and
  • obtained a pass mark of at least 75 per cent after being assessed by the competent authorities to have achieved the equivalent of Malta Qualifications Framework Level 2 in Maltese and provide evidence that the necessary fees charged in relation to the courses, examinations and certificates referred to above have been paid.

To switch from a temporary work visa to a work visa which leads to permanent residence one would need to go through the application and satisfy the conditions.

Bars to admission

The main bars to admission for work are lack of police clearance, health clearance (infectious diseases) or lack of clearance from stakeholders (Malta Tourism Authority for chefs; Malta Sports Council for sportspersons; Jobs Plus).

Lack of police clearance is a bar for the issuance of both an entry visa to Malta and an employment licence.

References for immigration law in Malta

  • The Constitution of Malta.
  • The Immigration Act – Cap 217.
  • The Employment and Industrial Relations Act – Cap 452.
  • The Employment Commission Act – Cap 267.
  • The Employment and Training Services Act – Cap 343.
  • The Maltese Citizenship Act – Cap 188.
  • The Refugees Act – Cap 420.
  • The European Union Act – Cap 460.
  • EU Regulations and Directives.

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