The Investment Services Act (Special Limited Partnership Funds) Regulations (the “Regulations”) introduced a new structure for investment funds in Malta, a limited partnership without a separate legal personality, a significant addition to the fund structuring solutions available in Malta. Here is a closer look at the structure and key features of Special Limited Partnership Funds.
Objective of the Special Limited Partnership Funds (SLPF) Framework
On 12 February 2025, the Malta Financial Services Authority (“MFSA”) launched the new framework for collective investment schemes (CISs) structured as Limited Partnerships without separate legal personality. The SLPF framework aims to bridge the gap in the local regulatory framework, in particular in terms of offering a flexible fund vehicle to the private equity space.
Key Features of the Special Limited Partnership Fund (SLPF)
Formation of the SLPF:
A SLPF is formed through a partnership agreement (either a public deed or private writing) between at least one general partner (“GP”) and one or more limited partners (“LPs”). Upon creation, the partnership agreement must be registered with the MFSA and the framework will solely be available to non-retail CISs aimed at qualifying and/or professional investors. The SLPF structure may be adopted by Professional Investor Funds, Notified Professional Investor Funds, Alternative Investment Funds, and Notified Alternative Investment Funds.
Limited Partnership Agreement (“LPA”):
The LPA serves as a foundational document for a SPLF. While the Regulations outline the essential contents that the LPA must include and also mandate that the LPA must be approved by the MFSA, it remains a particularly flexible document. Post set-up, it is then only any changes made to mandatory inclusions that will need prior approval from the MFSA while any other amendments will only require notification.
Legal Personality:
The SLPF will not have separate legal personality and it is the GP that will hold assets, enter contracts or sue or be sued in the name of the partnership.
Liability of the Partners:
The GP manages the partnership and is unlimitedly jointly and severally liable for the fund's debts. If legal action is taken against the SLPF, it is directed at the GP, who will first use partnership assets to satisfy claims. In contrast, in principle, the liability of LPs would not exceed the amount of their capital contribution or commitment to the SLPF.
Limitation of Object:
To ensure focus on investment activities, SLPFs must have a narrowly defined objective. The partnership deed must expressly limit the SLPF’s object in its partnership deed to the collective investment of funds in securities and in other movable or immovable property, or in any of them.
This new framework enhances Malta’s competitiveness as a fund domicile, providing investors and fund managers with a flexible, tax-efficient structure. With clear guidelines for efficient formation, registration, and ongoing compliance, the SLPF framework offers an appealing new opportunity, in particular for private equity funds.
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