Collective Investment Schemes


The setting up of Collective Investment Schemes (CISs) is regulated by the Investment Services Act, 1994, (ISA) which is modelled, to a large extent, on the EU Investment Directive of 1993. The Regulatory Authority under the ISA is the Malta Financial Services Authority (MFSA).

What is a CIS?

In brief, and broadly speaking, a CIS is a scheme created using any type of structure/vehicle for the purpose of collecting and pooling funds from investors through the offer to such investors of units in the CIS for subscription, sale or exchange and, subsequently, investing these funds in assets in accordance with certain investment objectives published in a Prospectus.

The value of the units/shares held by the public/investors in a CIS reflects the value per unit/share of the underlying assets of a CIS – in the case of a CIS which is ‘open-ended’, its size expands and contracts as investors buy and sell units in it, while a ‘close-ended’ CIS has a fixed share capital.

Set-up of CISs

CISs may take various forms including:

  • unit trusts under the Trusts and Trustees Act;
  • investment partnerships (very similar to the ‘limited partnership’ vehicle adopted in several foreign jurisdictions); 
  • mutual funds (the ‘fond commun de placement’);
  • open-ended investment companies that are set up in the form of a variable share capital company or SICAV under the terms of the Companies Act, 1995; or 
  • close-ended investment companies (or INVCO) also set up under the terms of the Companies Act, 1995.

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