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Recognition of foreign proceedings
Under what circumstances will the courts in your jurisdiction recognise the validity of foreign insolvency proceedings?
In terms of EU Regulation 1346/2000 on insolvency proceedings – which has direct effect in Malta and applies to proceedings where the centre of the debtor's main interests is located in the European Union – any judgment opening insolvency proceedings handed down by a court in an EU member state which has jurisdiction pursuant to Article 3 of the regulation will be recognised in all the other member states from the time that it becomes effective in the state of the opening of proceedings.
Otherwise, any judgment given in the context of foreign insolvency proceedings must be recognised and enforced in Malta in accordance with national law.
Winding up foreign companies
What is the extent of the courts’ powers to order the winding up of foreign companies doing business in your jurisdiction?
Pursuant to EU Regulation 1346/2000, if the centre of the debtor's main interests (which is presumed to be the place of the company’s registered office, in the absence of proof to the contrary) is situated in Malta, the Maltese courts will have jurisdiction to open insolvency proceedings. Where the centre of a debtor's main interests is situated in the territory of an EU member state, the courts of another member state will have jurisdiction to open insolvency proceedings against the debtor only if the debtor possesses an establishment within the territory of the other member state; the effects of such proceedings will be restricted to the assets of the debtor situated in the territory of the latter member state.
Outside the context of the abovementioned regulation, and with the exception of any special laws dealing with insurance undertakings, credit institutions or investment undertakings (among other things), Maltese courts do not typically have jurisdiction to order the winding up of a company registered outside Malta.
Centre of main interests
How is the centre of main interests determined in your jurisdiction?
In terms of EU Regulation 1346/2000, the centre of the debtor's main interests is presumed to be the place of the company’s registered office, in the absence of proof to the contrary.
What is the general approach of the courts in your jurisdiction to cooperating with foreign courts in managing cross-border insolvencies?
The Maltese courts will adopt a cooperative attitude in this respect.
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