Notice to Shipping Companies Covered by Merchant Shipping Regulations

March 20, 2020 | 2 minute read

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Notice to Shipping Companies registered under the Merchant Shipping (Shipping Organisations - Private Companies) Regulations, S.L. 234.42

Legal Notice 31 of 2020 brought into force the requirement of companies registered under the Merchant Shipping (Shipping Organisations - Private Companies) Regulations, S.L. 234.42 to submit audited financial statements as of financial year 2020, with the requirements therefore being quasi identical to those of regular private limited liability companies established in terms of the Companies Act.

As of financial year ending in 2020, all companies established under the Merchant Shipping Act (“MSA”) are to have their financial statements audited and submitted to the Registrar of Companies, with the requirements therefore being largely aligned, including penalties in case of default, to those companies established under the Companies Act (“CA”). Notably, submission is to be effected within 42 days from the end of the period for laying of annual accounts prescribed by article 182 of the CA i.e. ten months after the end of the relevant accounting reference period.

The exemptions afforded to CA companies in so far as the requirement of a directors’ report are concerned, apply to MSA companies too, the only exception being a variance in the thresholds as to what constitutes a ‘small company’ under Art.185 CA not applying to MSA companies. A small (and consequently exempt from the requirement to prepare a directors’ report) MSA company is one which does not exceed two of the below three thresholds, in terms of the Merchant Shipping (Shipping Organisations - Private Companies) (Amendment) Regulations, 2020.

  • Balance sheet total Euro 6,000,000 (Euro 4,000,000 for CA companies);
  • Turnover of Euro 12,000,000 (Euro 8,000,000 for CA companies);
  • Not more than fifty employees.

Moreover, whilst the exemptions from the preparation of consolidated accounts in terms of the CA (now applicable to MSA Companies) shall apply to MSA companies in the same way, a parent company established under the MSA can qualify as a ‘small company’ in terms of the foregoing only if the group of which it is parent qualifies as a small group, that is, on a consolidation basis does not exceed the limits of two of the three following criteria:

  • Aggregate balance sheet total: Euro 6,000,000 net or Euro 7,200,000 gross;
  • Aggregate turnover:  Euro 12,000,000 net  or  Euro 14,400,000 gross.

All articles of the CA in relation to the keeping of accounting records (and the content and form thereof), exemptions, disclosure requirements, directors’ report, audit reporting and laying of accounts before general meeting, and submission of accounts, together with the accompanying liabilities and penalties, shall, except in so far as they have been varied as mentioned in this article, be applicable to MSA companies.

Directors of MSA companies are encouraged to get in touch with to ensure their accounting records are up to date in time for submission to the Registrar in terms of the new regulations following the lapse of the financial year ending 2020. Whilst accounting records of previous years do not seem not be required for submission to the Registrar, they are nonetheless to be duly prepared for compliance with the submission obligations and financial reporting standards.

For further information please feel free to contact us:

Dr. Alexandra Dimech – alexandra.dimech@nexiabt.com
General enquiry – info@nexiabt.com

 

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