There were several important legislative changes which were published over the course of September 2025. Below is an overview of the key updates across different areas.
One pivotal Act was published in September – the Employment and Industrial Relations (Amendment No. 2) Act, 2025. This introduced mandatory bank transfers or electronic transfers facilitated by accredited and licensed financial institutions, for the payment of wages to third-country nationals. The scope of this Amendment Act is to include a definition of “third-country national” in Article 2 of the principal Act, which shall have the same meaning as assigned to it in article 2 of the Immigration Act, Chapter 217 of the laws of Malta. A new proviso has been added in sub-article (1) of article 11 of the principal Act, which provides that any wages earned by or payable to a third-country national shall be paid exclusively by means of a bank transfer to an account held in the name of the employee or through an electronic transfer facilitated by an accredited and licensed financial institution. This requirement would apply to all third-country nationals whose employment commences on or after 1st October 2025.
In addition to the legal notices mentioned in our previous legal update for August 2025, on the 2nd September 2025, the Investor Compensation Scheme (Amendment) Regulations, 2025 were published fully transposing the Investment Firms Directive (the “IFD”) with changes to the operation of the Management Committee, introducing an acting chairperson mechanism, and new powers associated with funding, with all current members’ term ending on 2 September 2025. In parallel, the Malta Financial Services Authority (“MFSA”) issued a Circular informing the industry of the publication of amendments to the Investment Services Act, the Banking Act, various Subsidiary Legislation issued in terms of the Investment Services Act, and the Investment Services Rules applicable to investment firms, to fully transpose the IFD and clarify any possible misinterpretations.
Furthermore, on the 2nd September 2025, the Final Income Tax Without Imputation Regulations, 2025 were published introducing a new elective regime for taxation without imputation. This allows entities to elect for a flat 15% final income tax on their chargeable income instead of using the traditional full imputation system. The said election may be made in respect of income accruing to or derived by the entity in the fiscal year preceding the year of assessment 2025 and subsequent years.
At a European level, the European Commission published its implementation strategy for the VAT in the Digital Age (ViDA) package, presenting actions to support businesses and Member States with the practical implementation of the EU’s VAT framework updates. The ViDA package introduces new digital reporting requirements, addresses challenges in the platform economy sector with specific VAT adaptations, and develops a more streamlined single VAT registration process. The new implementation strategy highlights the different steps required for these measures to enhance the transparency of digital transactions, aligning them with the EU’s broader digital policies, and simplifying compliance for businesses operating across borders.
On the 9th September 2025, the European Securities and Markets Authority (“ESMA”) published its second risk monitoring report of 2025, setting out the key risk drivers currently facing EU financial markets. Beyond the general risk drivers, ESMA’s report provides an update on structural developments and the status of key sectors of financial markets, during the first half of 2025. The report covers risk monitoring of markets, asset management, consumers, infrastructures and services, structural developments of market-based finance, sustainable finance and financial innovation. Also on the 9th September 2025, the Joint Committee of the three European Supervisory Authorities (EBA, EIOPA and ESMA – the ESAs) published its fourth annual Report on the extent of voluntary disclosure of principal adverse impacts (PAIs) under the Sustainable Finance Disclosure Regulation (SFDR). The ESAs have observed a steady improvement in the quality of the PAI voluntary disclosures at both entity and product level.
Further to this, on the 25th September 2025, ESMA published the updated reporting instructions and XML schema (version 1.2.0) for the weekly reporting of commodity derivatives positions under the Markets in Financial Instruments Directive II (MiFID II), reflecting the changes from the latest review. Beyond the changes directly originating from MiFID II – such as the requirement to publish two weekly reports and the exclusion of (spot) emission allowances from position reporting – the updated XML schema and reporting instructions also include other amendments to ITS 4, like the harmonisation of reporting units for energy derivatives. The adjustments are based on ESMA’s Final Report submitted to the European Commission in December 2024, which is currently pending adoption. ESMA has opted for this approach to ensure a consistent reporting framework and minimise the need for frequent updates to the XML schema and instructions.
Locally, the Financial Intelligence Analysis Unit (“FIAU”) ) issued a Guidance Note addressed to company service providers (“CSPs”) subject to registration, corresponding to limited CSPs, which sets out how it considers that AML/CFT obligations can be applied by any such CSP in a more proportionate manner in line with the nature and size of the activities carried out by the same. Limited CSPs are not required to register on CASPAR. The MFSA and the FIAU have put in place a process whereby the MFSA will be transmitting to the FIAU the details of anyone who registers as a limited CSP or otherwise de-registers from the said category. This will allow the FIAU to still have visibility of all CSPs that fall to be considered as subject persons. Any CSP who de-registers from a limited CSP and obtains a full authorisation in terms of the Company Service Providers Act would then need to register on CASPAR.
In the capital markets sphere, the MFSA issued a Circular addressed primarily to issuers having securities Admitted to Trading on a regulated market and potential Offerors, as defined in Chapter 11 of the Capital Markets Rules, seeking to obtain a controlling interest within an Offeree Company, as defined in Chapter 11 of the Capital Markets Rules. Moreover, the MFSA published a Circular in relation to the updated Capital Markets Rules on the 5th September 2025, specifically Chapter 5 and Chapter 11 thereof. The updated set of the Capital Markets Rules can be found here. The amendments concern the European Single Access Point (“ESAP”) and the EU Takeover Bids Directive.
Additionally, the MFSA published a issued a Circular to notify the industry that under Article 22(1) of the Markets in Crypto-Assets Regulation (MiCA), issuers of asset referenced tokens and e-money tokens denominated in a currency that is not an official currency of a Member State are required to report specific data to their competent authorities (CAs). In line with Article 22(3), MiCA places a direct requirement on crypto-asset service providers (CASPs) servicing such tokens to provide the issuers with the information necessary to prepare these reports.
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