Malta Update: Registrar Of Companies Ordered To Revive Struck-Off Company For Payment Of Salary Arrears

In the case Thomas Pinter v Registrar of Companies decided on the 22^nd April 2022, the Commercial Court presided by the Honourable Judge Dr Ian Spiteri Bailey upheld the applicant’s request for the revival of a Company, which had previously been struck off, for its continuous non-compliance with its obligations under the Companies Act (Register of Beneficial Owners).

The applicant Pinter, a former employee of the defendant company was owed money for  unpaid salaries, in the aggregate amount of €80,653.90.

However following his dismissal, the applicant discovered that the defendant company had been struck off from the Company Registry.

Proceedings filed in Austria could thus not be continued until the applicant obtained a judgement in Malta reinstating the Company on the Company Registry and eventually declaring it insolvent.

Hence, this led the applicant to file an action in terms of Subsidiary legislation 386.19 of the Laws of Malta, to obtain the necessary declarations from the Courts of Malta, which would allow the continuation of the Austrian proceedings.

In its considerations, the Court acknowledged that the defendant Company had failed, for the entire time that it had been registered on the Registrar of Company, to honour its obligations as required under the Companies Act (Register of Beneficial Owners) Regulation as it had effectively failed to notify the registrar of companies with information of its Ultimate Beneficial Owners or even to submit its annual accounts.

Furthermore, the defendant Company owed the Registrar the sum of €19,145 representing penalties for breaches.

These factors had ultimately led to the Registrar to decide to strike off the Company’s name from the Register of Companies.

In reaching its decision, the Court explained that in such circumstances, the law empowers the Court to restore the Company’s name on the Registry of Companies should it consider it “proper” to do so or where it considers it to be necessary and just.

The Court made it clear that should it accede to the applicant’s request and order the company’s restoration, such order should never be understood as an acceptance that there can be companies on the Registry which are in breach of their regulatory obligations and that the Registrar would do well to continue to strike off such companies for their non-compliance.

It however also noted that in the circumstances, it should not deprive an employee of the opportunity to recuperate salary arrears.

Hence, the Court ordered the Registrar to restore the Company’s name on the Register of Companies, in terms of Regulation 9(4) of the Companies Act (Register of Beneficial Owners) Regulations (S.L. 386.19) as if the Company had never been struck off, and ordered the applicant to conclude all necessary procedures ongoing in Austria for the recovery of the amount due, within the period of two years.

FFF Legal represented Mr. Thomas Pinter in the proceedings.