Securitization Cell Company
Premier SCC is a Securitization Cell Company (SCC) established as a special purpose vehicle for the issue of asset-backed securities permitted in terms of the Securitization Act (Chapter 484) of the Laws of Malta.
The object and purpose of Our SCC are exclusively limited to securitization and to all operations and transactions required to participate in a securitization including, without limitation, the purchase, management and collection of credits or other receivables or other securitization assets, risk-taking, the granting of secured loans, the issuance of securities.
The “core business” of the Issuer is to issue a series of securities, with limited recourse, in the form of notes or certificates or bonds, through segregated Cells, whose value or yield is linked to specific assets or risks.
The Issuer will be exclusively targeting professional investors, as defined under MiFiD.
The investment strategy of the cells may include listed and unlisted securities, with a specific focus on:
- Non performing Loans;
- Real Estate properties;
- Managed Account.
Premier Consulting is able to offer a securitization platform inclusive of a cellular compartment (Cell) created in Malta by our local company Premier SCC Limited capable of issuing Asset Backed Notes in order to raise funds from professional and institutional investors, with the acknowledgement and the control of the MFSA and Central Bank of Malta.
For each note we will provide the Bloomberg Ticker, we will open the eligible ISIN code to be delivered through Euroclear and, upon request, we will arrange the listing of the notes on Vienna MTF Stock Exchange (https://www.wienerborse.at) where the notes can be daily traded via Exchange.
This dynamic platform offers different advantages: the quality and the flexibility of the Maltese Securitization Common Law together with the competitive fees of the local professional intermediaries for the legal and administrative services.
Finally the global visibility offered by the quotation of the bonds on the Vienna MTF stock exchange.
A Maltese Securitization Cell Company (SCC) enters into a securitization transaction through its cells and each cell may be used for multiple transactions, on condition that the assets in relation to each transaction of a specific cell are owned by the from the same originator.
By Maltese law, the assets and liabilities of a particular cell are the sole patrimony of that cell. These assets and liabilities are ring-fenced from the cellular assets/liabilities of others cells and from the non-cellular assets/liabilities, belonging to the core. In consequence, cellular assets are safeguarded from being used to satisfy liabilities that are not attributable to that particular cell. Moreover, assets attributable to a cell are protected from the creditors of the SCC who are not creditors in respect of such particular cell.
An SCC’s directors must ensure that cellular assets are kept separate and are separately identifiable from non-cellular assets and from cellular assets of to other cells.
Emerging as an international domicile of choice for securitization vehicles, Malta provides several highly credited services that have generated signiﬁcant growth within the respective market in Malta. Several advantageous elements include:
- Tax neutrality ensuring that there is no additional tax burdens at any level of securitization;
- Qualiﬁcations and knowledge of workforce;
- Flexible legislative environments that can adapt to the needs of structure even though a securitization vehicle is not a regulated entity;
- Accessibility and responsiveness of the tax and supervisory authorities;
- Expertise and cost competitiveness of locally-based service providers;
- The ability to outsource to the extent possible both within the jurisdiction and cross-border.
Securitisation Key Elements
SV is subject to the standard Maltese tax system. Income tax is charged on the worldwide income and gains of the SV
Taxable income of the SV can be reduced or eliminated by the general rules on deductions of eligible expenses and the deduction of expenses under the Securitisation Transactions (Deductions) Rules.
Permitted deductions include:
- Expenses wholly and exclusively incurred in the production of the income;
- Payables from SV to originator for the securitization assets;
- Payables in relation to the instruments issued by an SV;
- Expenses connected to day-to-day running of an SV; and
- A further deduction (the “Residual Profit Deduction”) of an amount equal to the total remaining income, if any.
- No Malta tax liability for originator who is not tax resident in Malta on consideration for securitzation assets
- No withholding tax on payments by SVs to non-Malta resident investors holding of equity (dividend) or debt (interest) instruments of SVs
- Exemption from income tax on gains derived from a transfer of securities in an SV by non-Malta residents
- Exemption from stamp duty on a transfer of securities issued by an SV
- Malta resident SVs enjoys possibility to avail of extensive double tax treaty network (70 treaties currently signed and ratified by Malta)
No requirement to be licensed / authorized or otherwise regulated
- No restrictions on identity of originator e.g. hedge funds (including non-licensed funds established outside the EU), shipowners or aircraft owning entities, IP holding entities, credit institutions, Government, parastatal bodies etc.
- May hold equity stake in the securitization vehicle, be a subsidiary of the securitization vehicle or be unrelated to it.
- May be established in or outside Malta
- May take any legal form e.g. private or public limited company, investment company, partnership, trust, securitization cell company etc.
- Company and partnership formation in Malta in one – two business days from submission of constitutive documents for limited companies and partnerships.
- Minimum share capital for private companies of EUR 1,165 (at least 20% paid up) and EUR 46,588 public companies (at least 25% paid up).
- May be ‘orphaned’ through Maltese purpose foundations. Not required due to bankruptcy remoteness provisions built into the Securitization Act.
Securitization vehicle (‘SV’)Issuer
Title to securitization assets may be transferred by any legally recognized form
- Such transfers are not subject to re-characterization for any reason whatsoever
- Additionally, the Securitization Act provides that such assignments are final, absolute and binding on the originator, the SV and on all third parties, notwithstanding any underlying contractual or statutory prohibition or restriction on the originator in relation to the securitization assets.
Transfers of securitization assets treated as final
Proceedings taken under Maltese law against an originator cannot impinge on:
- a securitization vehicle;
- its cash flow;
- underlying securitization assets; and
- any other assets and obligation due in its favor by underlying debtors in connection with the securitization assets
- In practice an SV may additionally be ‘orphaned’ through a Maltese purpose foundation.
Bankruptcy remoteness of originator
By virtue of the Securitization Act, only securitization creditors are permitted to demand the issuance or enforcement of any precautionary act or warrant against the SV; save only where fraud is proven to the satisfaction of the courts in Malta.
Limited litigious recourse
Provided also in the Securitization Act is that an SV’s constitutive documents may permit a particular class of persons only to demand or place the SV under:
- dissolution and winding-up proceedings,
- company recovery procedure
- company reconstruction or other proceedings affecting creditors’ rights.
Additional benefits of securitization vehicles
Additionally, securitization transactions can be structured using Maltese securitization vehicles to benefit from:
- no restrictions on the type of securitzation assets;
- securities issued by an SV may be listed on a regulated market, whether in Malta or outside;
- SVs are excluded from the scope of AIFMD by virtue of the Securitization Act;
- SVs may issue securities backed by underlying alternative investments and target funds to purchase their securities;
- all forms of securitization transactions are permitted, covering outright acquisition of the securitization assets, assumption of risks and the taking control of whole businesses;
non-EU fund managers may use securities issued by SVs
- transfers to SVs of securitization assets are final, cannot be challenged / re-characterized;
- bankruptcy remoteness of the originator is provided for expressly by statute;
- the Securitization Act restricts litigious recourse against an SV;
- legal formalities for transfer of securitization assets to an SV are simplified;
- securitization investors and creditors are granted, by law, senior claims over the Cell’s assets;
- light touch regulatory oversight swift incorporation of SVs, requiring only a day or two to complete registration from the submission of the constitutive documents in the case of limited companies or partnerships.