In this aspect, the Malta Stock Exchange is issuing a consultation document in order to allow relevant market operators and stakeholders to provide feedback, comment and submit other contributions to the draft bye-laws being proposed below. These bye-laws are intended to allow REITs to become eligible financial instruments that may be admitted to the Exchange for listings in terms of Chapter 5 of the Bye-Laws of the Malta Stock Exchange.
Eligibility for Listing
The consultation document specifies that in order for an issuer to be eligible to be admitted by the Exchange for listing as a REIT, in addition to the requirements already laid down in Chapter 5 of the bye-laws, the Issuer has to provide to the Exchange, a report issued by an Auditor, before the beginning of each accounting period for which the Issuer can be eligible to be admitted as a REIT, and specifying a date upon which a number of conditions can be met.
Property Rental Business
For the purposes of eligibility as a REIT, property rental business is required to be segregated from all other income of the issuer which is not derived from property rental business and shall be treated as though it has been earned by a separate company.
Disposal of Assets and Raising of New Capital
It is being proposed that where a REIT acquires an asset which is used for the purposes of its Property Rental Business and following that acquisition:
The consultation document proposes that every Issuer receiving a confirmation from the Exchange relative to its eligibility as a REIT shall in respect of each accounting period, by not later than three months from the year following that in which the accounting period ends make a statement to the exchange confirming that the provisions of the bye-laws have been complied with during the accounting period under review.
Article written by Dr Cherise Abela Grech and Dr Luke Mizzi.
This article is not intended to impart legal advice and readers are asked to seek verification of statements made before acting on them.