INTERVIEW
Issue 48
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April 7, 2016
Distributed with Times of Malta
City of London Corporation lobbyist Jeremy Browne is confident that the capital would reinvent itself in the event of a Brexit vote – but explains why most businesses believe staying in is the better option. see pages 10 and 11 >
NEWS Job candidates should be more aware of the options they have when signing up with recruitment agencies, Data Commissioner Saviour Cachia believes. see page 3 >
Practitioners urge banks to speed up account opening Vanessa Macdonald There seems to be no relief in sight for foreigners who want to open bank accounts in Malta, even though practitioners are complaining that it is taking longer and longer – to the point that it is deterring investment. Practitioners are well aware that the scenario has changed dramatically with regards to regulation, but the perception of many contacted by The Business Observer – all of whom only spoke on condition of anonymity – is that banks are now going beyond what they actually need to do and are “being holier than the Pope”. “Ten or 15 years ago, it used to be a simple thing for a foreigner; now it is the hardest thing – and not only for company owners but also employees! It took almost two years for one of our clients,” one said. “Banks sometimes just say ‘no’ outright, within a matter of days. In other cases, they just drag their feet and you have to keep chasing them. At
one stage, we had international clients threatening to pull out of Malta. “It is not only about the considerable time but also the cost involved: some banks ask for the same documents two or three times because new policies are introduced. And some fees have doubled and trebled overnight. We appreciate that banks now need huge compliance teams. But it is very frustrating and it is harming local businesses.” Another explained that banks will not take clients unless they have a presence in Malta – not just having a registered office and a local director but also being active, and having employees at a physical place of work. “I am very grateful that they have protected Malta from potentially embarrassing situations as they may uncover things that we have not since they have more tools available to them. But I have seen it go from one extreme to the other. Jurisdictions have to be practical,” he said. To make matters worse, the Single European Payment Area was set up with the intention of
OPINION
blurring the distinction between local banks and those in member states – but it now appears that Europe is trying hard to deter this. “There is undoubtedly pressure building up for a company to use a bank in the country where it is actually operating, in spite of the fact that this goes diametrically against the whole concept of freedom of movement of capital,” another expert said. “The clampdown on tax avoidance has been building and will increase – and revelations like the Panama Papers will only make banks around the world even more wary.” The two main local banks have defended their operations. A Bank of Valletta spokesman said the bank’s account opening process are governed by stringent ‘know your customer’ procedures, to ensure that new customers and funds were traceable and coming from legitimate sources – in line with international practice, and are based on a number of regulations, including the Prevention of Money Laundering and Funding of Terrorism. Continued on page 3
Other jurisdictions are doing all they can to establish themselves as fintech capitals and Ganado Advocates believes Malta should be doing the same. see page 5 >
NEWS 6PM founder Ivan Bartolo is “both proud and sad” that someone has come forward interested in company shares but feels that it was inevitable given growing interest in the health sector. see page 6 >