Cap. 386 Art. 174Exemption for parent companies included in accounts of larger groups.

(1) A parent company shall be exempt from the requirement to prepare consolidated accounts if it is itself a subsidiary company in the following cases -

(a) where the said parent company is a wholly-owned subsidiary company of an immediate parent company formed and registered under the law of a Member State or an EEA State; or

(b) where more than fifty per cent in nominal value of the shares in the said parent company are held by a parent company and notice requesting the preparation of consolidated accounts has not been served on the first mentioned company by shareholders holding in the aggregate not less than ten per cent in nominal value of all the shares thereof. Such notice shall not be valid unless it is served not later than six months after the commencement of the accounting period to which it relates.

(2) The exemption referred to in sub-article (1) shall be conditional upon compliance with all of the following requirements -

(a) that in the case of a parent company which is itself a subsidiary company of a parent company formed and registered under the law of a Member State or an EEA State, such company is included in consolidated accounts for a larger group drawn up to the same date, or to an earlier date in the same accounting period, by a parent company formed and registered under the law of a Member State or an EEA State;

(b) that in the case of a parent company which is itself a subsidiary company of a parent undertaking not registered under the law of a Member State or an EEA State, the exempted undertaking is included in consolidated accounts for a larger group drawn up to the same date, or to an earlier date in the same accounting period, provided such consolidated accounts and the director’s report thereon are drawn up in a manner equivalent to that required by this Act and have been audited by one or more persons authorised to audit accounts under the national law governing the undertaking which drew them up;

(c) that the said parent company discloses in its individual accounts that it is exempt from the obligation to prepare and deliver consolidated accounts;

(d) that the said parent company states in its individual accounts the name and registered office of the parent undertaking which draws up the consolidated accounts referred to in paragraph (a) or (b);

(e) that the said parent company delivers to the Registrar within the period allowed for delivering its individual accounts, copies of the consolidated accounts referred to in paragraph (a) or (b), and of the parent undertaking’s directors’ report or its equivalent, together with the auditors’ report on those consolidated accounts; and

(f) that if any document comprised in accounts and reports delivered in accordance with paragraph (e) is in a language other than Maltese or English, there is annexed to the copy of that document a translation of it into Maltese or English, certified to be a correct translation in such manner as may be prescribed.

(3) The exemption shall not apply to a parent company any of whose transferable securities have been admitted to trading on a regulated market or on an equivalent market in a non-Member State or non-EEA State.

(4) Shares held by directors of a company for the purpose of complying with any share qualification requirement shall be disregarded in determining for the purposes of sub-article (1)(a) whether the company is a wholly-owned subsidiary company.

(5) For the purposes of sub-article (1)(b) shares held by a wholly-owned subsidiary undertaking of the parent undertaking, or held on behalf of the parent company or a wholly-owned subsidiary undertaking, shall be attributed to the parent company.