Malta Protected Cell Companies what they are and how they work

Nikita Veremeev

08.11.2025 | 6 min read

Updated: 08.11.2025

In 2024 the global insurance and financial services market faced an unprecedented rise in cyber risks, lawsuits and regulatory requirements: according to Insurance Europe, losses from cyber incidents in the EU alone exceeded €8 billion, and the number of new insurance licences in Europe and Asia grew by 27% year‑on‑year. Against this backdrop, entrepreneurs and chief financial officers are under pressure: how to launch an international insurance product, protect assets, comply with Solvency II, reduce operating expenses and scale the business — all at once?

Why, despite hundreds of jurisdictions, are large and medium-sized companies increasingly choosing Malta Protected Cell Companies (PCC Malta) as a strategic tool for business growth and protection?

As the founder of COREDO, I see every day how regulatory, licensing and risk management issues become critical for our clients in Europe, Asia and the CIS. The Protected Cell Company structure in Malta is not just a fashionable trend, but a real way to address these challenges. In this article I will examine in detail what a Protected Cell Company is, how a PCC operates in Malta, what advantages it gives to business, and why registering a PCC in Malta right now is becoming a key solution for insurance and financial companies, as well as for projects in aviation, shipping and securitization.

If you want to understand how to protect assets, accelerate Licensing, meet MFSA and Solvency II requirements, reduce costs and boost investor confidence, read on. Here you will find not only theory but practical recommendations based on COREDO’s experience and current international standards.

Malta Protected Cell Company (PCC): what is it and how does it work?

Illustration for the section «Malta Protected Cell Company (PCC): what is it and how does it work?» in the article «Malta Protected Cell Companies – what they are and how they work»

Malta Protected Cell Company (PCC): is a unique corporate instrument that allows creating separate cells (Cells) within a single legal structure, providing reliable segregation of each cell’s assets and liabilities. To understand how a PCC works in practice, it is important to grasp its basic setup: what the Core consists of and how the Cells are organized.

Structure of a PCC: what the Core and Cells are

A Malta Protected Cell Company is a legal entity capable of creating independent “cells” (cells), each of which functions as a separate division with its own assets and liabilities. In a PCC structure there is the Core and the Cells. The Core is the central part of the company, holding the licence and common administrative functions, while each cell can issue its own insurance products, manage investments, or serve separate projects.

Key principle: separation of assets and liabilities (asset segregation): the assets of one cell are completely isolated from others and from the Core. This provides legal protection (ring-fencing) — if one cell faces losses or lawsuits, the other cells and the Core are not liable for its obligations. This mechanism allows the creation of multi-cell structures to manage different types of insurance, reinsurance, investment, and corporate projects.

COREDO’s practice confirms: creating cells in a PCC allows for quickly launching new insurance products or investment lines without the need to establish a separate legal entity for each business, which significantly reduces costs and speeds up market entry.

Legal status of a PCC in Malta

The registration of a PCC in Malta is regulated by the Companies Act (Cap. 386) and the specialized rules of the MFSA (Malta Financial Services Authority). A Maltese PCC has the status of an independent legal entity, but each cell within the company is not a separate corporation; it is a structural part of the PCC with its own balance of assets and liabilities.

The process of registering a PCC in Malta includes:

Preparing the constitutional documents specifying the ability to create cells.
Obtaining preliminary approval from the MFSA for the structure and business plan.
Contributing the minimum capital (usually from €100,000 for insurance PCCs, but requirements may vary depending on the licence and type of activity).
Appointment of the board of directors and a compliance officer responsible for AML and corporate governance.
Submitting the application for registration and licensing.

The solution developed by COREDO allows clients to go through this process as quickly as possible: our experience shows that with properly prepared documents and interaction with the MFSA, PCC registration takes from 2 to 4 months, including the stages of Due Diligence and structure approval.

Thus, registering a PCC in Malta requires step-by-step preparation of documents, coordination with the MFSA and completion of all procedures in close interaction with the regulator, which, with a competent approach, takes from 2 to 4 months.

Next, we will consider the key asset protection mechanisms and the principles of ring-fencing in PCC structures.

Asset protection mechanisms and ring-fencing in PCCs

One of the main reasons for the popularity of Malta PCCs is reliable asset protection (asset protection). A PCC implements the ring-fencing principle: the assets and liabilities of each cell are legally and from an accounting perspective isolated from others. This means that the creditors of one cell cannot claim the assets of other cells or the Core. This approach is especially in demand in insurance and reinsurance, where the risk of “cross-contamination” (the flow of losses between products) can lead to significant financial losses.

In COREDO’s practice there have been cases where, thanks to ring-fencing, clients were able to avoid major lawsuits and maintain business resilience even when one of the cells became insolvent. Additionally, Malta offers orphaned trust structures for managing cells, which strengthen asset protection and reduce legal risks.

Benefits of PCC for businesses and insurance companies

Illustration for the section «Benefits of PCC for businesses and insurance companies» in the article «Malta Protected Cell Companies – what it is and how they work»

The benefits of PCC for businesses and insurance companies open new opportunities for risk management, asset optimization and scaling operations. Thanks to its unique structure, a PCC allows not only to save on administrative expenses but also to flexibly develop a business within a single legal platform.

Cost savings and business scaling with PCC

The PCC structure allows for a significant reduction in operating costs due to shared infrastructure, unified compliance and administrative functions. Instead of creating a separate company for each insurance product or project, an entrepreneur can open a new cell within an existing PCC, which saves time on licensing and reduces costs for audit, accounting and management.

COREDO’s experience shows that for small and medium insurance companies scaling savings reach 30-40% compared with traditional structures. In addition, PCC Malta provides flexibility: launching new products or entry into new markets can take weeks rather than months.

Thus, the PCC model not only optimizes costs but also opens up wide opportunities for flexible management of insurance solutions and the implementation of captive insurance.

Flexibility in managing insurance products and captive insurance

A PCC is ideally suited for managing multiple insurance products, captive insurance (affiliated insurance) and reinsurance. Each cell can be configured for a specific type of risk, client or geography, which facilitates risk management and compliance with Solvency II requirements.

The COREDO team implemented projects where a single PCC simultaneously serviced corporate insurance, reinsurance and insurance of aviation risks, using separate cells for each line. This approach allows for precise risk segmentation, optimization of capital requirements and rapid response to market changes.

Attracting investors and building trust in the business

The financial transparency of a PCC, clear separation of assets and liabilities, as well as the ability of cells to pay insurance dividends make the structure attractive to investors. An investor can participate in only one cell, without bearing the risks of other PCC business lines.

COREDO’s practice confirms: registering a PCC in Malta increases trust in the business among banks, partners and international regulators, which facilitates attracting financing and business expansion.

Regulation and Licensing of PCC in the EU and in Malta

Illustration for the section «Regulation and Licensing of PCC in the EU and in Malta» in the article «Malta Protected Cell Companies – what they are and how they work»

Regulation and licensing of PCC in the EU and in Malta are key factors that define how protected cell companies operate in the region. Special attention is paid to the licensing process and supervision by regulators such as the MFSA, which ensures compliance with European Union standards and Maltese law.

The role of the MFSA in regulating a Protected Cell Company (PCC)

MFSA, the key regulator of Malta’s financial sector, is responsible for licensing, supervision and oversight of PCC Malta. It is the MFSA that approves business plans, examines corporate governance, monitors AML compliance/CTF and Solvency II, and also sets reporting requirements for the PCC and each cell.

Our experience at COREDO has shown that close cooperation with the MFSA at early stages of a project helps avoid delays and minimize the risk of license refusal. The MFSA places high demands on transparency, governance structure and internal control of a PCC.

Capital requirements under Solvency II

PCCs in Malta are required to comply with capital requirements set by both Maltese legislation and the European Solvency II directive. For insurance PCCs the minimum capital (Minimum Capital Requirement, MCR) starts at €100,000, but additional requirements may be imposed for individual cells depending on the nature of the risks and insurance products.

Solvency II imposes requirements under Pillar II (risk management, internal control) and Pillar III (reporting and public disclosure). The solution developed at COREDO enables clients to build a risk management and reporting system compliant with Pillar II and III, which significantly speeds up the licensing process and reduces regulatory risks.

Licensing of PCC and individual cells

Licensing PCC Malta involves two stages: obtaining a license for the core and subsequent licensing of each new cell. To open a new cell it is necessary to submit a business plan, a risk description, the governance structure and to confirm the availability of sufficient capital.

In practice, if the core is already licensed and an effective compliance system is in place, licensing a new cell takes from 4 to 8 weeks. This approach allows rapid scaling of an insurance business, launching new products and adapting to market requirements.

Practical application of PCC in business

Illustration for the section «Practical application of PCC in business» in the article «Malta Protected Cell Companies – what it is and how they work»

The practical application of PCC in business is becoming increasingly in demand due to the constant need for effective risk management, financial resilience and flexibility of corporate structures. The use of PCC is especially relevant for industries such as insurance and reinsurance, where the key tasks are risk diversification and capital optimization.

PCC in insurance and reinsurance

Malta Protected Cell Companies are widely used for insurance and reinsurance. Insurance cells allow the creation of bespoke products for corporate clients, managing the risks of individual projects or business segments, as well as operating through insurance intermediaries and brokers.

A practical example from COREDO: for one European client a PCC was created with cells for insuring cyber risks, directors’ liability and reinsurance of aviation risks. This provided risk isolation and flexibility in managing insurance reserves.

PCC in aircraft leasing and shipping

PCC Malta is actively used in the aviation and shipping business. Cells allow structuring the leasing of aircraft, marine cargo insurance and shipowners’ liability, providing transparency and asset protection.

The COREDO team supported projects to establish PCCs for aircraft leasing, where each cell serviced an individual aircraft or a group of vessels, which facilitated risk management and compliance with international standards.

Thus, the use of PCC provides a flexible structure for implementing complex tasks of managing and structuring transport assets, smoothly transitioning to the possibilities of applying cells in securitization and SCC.

Use of PCC in securitization and SCC

In Malta it is also permitted to create Securitisation Cell Companies (SCC), analogues of PCC for asset securitization. This allows combining various financial instruments, isolating risks and reducing capital requirements for investment projects.

COREDO’s practice shows that SCCs are in demand by international funds and banks interested in structuring complex financial products with minimal legal risks.

Corporate governance and risk management in a PCC

Illustration for the section «Corporate governance and risk management in a PCC» in the article «Malta Protected Cell Companies – what they are and how they work»

Corporate governance and risk management in a PCC provide a clear structure for allocating rights, responsibilities and control among shareholders, the board of directors and management, which is critical for the company’s resilience and operational effectiveness. This approach enables timely identification of risks and the design of internal processes so that they align both with business objectives and with requirements for transparency and accountability to stakeholders.

Corporate structure management and the board of directors

Effective corporate governance of a PCC requires a professional board of directors with experience in insurance, finance and compliance. The board is responsible for strategy, oversight of cell activities, and ensuring compliance with MFSA and Solvency II requirements.

At COREDO we recommend forming a board with independent directors and appointing a separate compliance officer for each cell, which increases the level of control and reduces legal risks.

MFSA and Solvency II: reporting and disclosure

Each PCC and its cells are required to keep separate accounts, prepare individual financial statements and undergo an annual audit. The MFSA requires submission of regular reports on capital, risk management and financial results in accordance with Pillar III of Solvency II.

The solution implemented by COREDO allows automation of the reporting process and ensures full transparency for the regulator and investors.

Legal risks when working with a PCC: how to minimize

Although the PCC structure provides a high level of asset protection, there are legal risks associated with errors in corporate governance, non-compliance with MFSA or Solvency II requirements, as well as possible disputes between cells and the core.

COREDO’s practice confirms: risk minimization is achieved through a clear internal regulation, regular audits, the implementation of an internal control system and the engagement of professional legal advisors.

PCC tax regime in Malta

The PCC tax regime in Malta provides international companies with unique opportunities to optimize their tax burden and manage financial flows. Thanks to a special approach to taxation and the flexible PCC structure, businesses can access a range of benefits, significantly reducing the effective tax rate and optimizing their operations.

Tax advantages of PCC for international companies

Malta offers an attractive tax regime for PCC: corporate tax is 35%, but with the correct tax refund structure the effective rate can be reduced to 5–10%. The income and expenses of each cell are accounted for separately, which facilitates tax planning for international companies.

At COREDO we recommend using PCC to optimize tax burden and structure international capital flows, especially in combination with agreements on the avoidance of double taxation.

Registration and management of PCC – legal support

Legal support for PCC in Malta requires deep knowledge of local and European legislation, AML standards and corporate governance practices. The COREDO team provides full support at every stage: from document preparation and interaction with the MFSA to implementation of internal control systems and audit support.

Our experience shows that investments in professional legal support pay off through shorter registration times, reduced regulatory risks and increased trust from investors and partners.

Recommendations for Entrepreneurs

Malta Protected Cell Companies are an effective tool for international business, allowing you to:

Protect assets and isolate risks between business lines.
Reduce operating costs and accelerate scaling.
Attract investors through the transparency and manageability of the structure.
Comply with the strict requirements of the MFSA and Solvency II.
Optimize tax burden and simplify international settlements.

Practical steps to launch a PCC in Malta:

Assess your business model and determine which lines require risk isolation.
Prepare a business plan and PCC structure taking into account MFSA requirements.
Appoint a board of directors and a compliance officer with insurance experience.
Complete the registration and licensing procedures for the PCC and its cells.
Implement an internal control system, automate reporting, and ensure Solvency II compliance.

For risk management and corporate governance use best international practices: regular audits, an independent board of directors, a transparent ownership structure and effective communication with the regulator.

Choosing a reliable partner to support your PCC is the key to long-term success. COREDO’s experience in registering, licensing and supporting PCCs in Malta confirms: only a comprehensive approach and a deep understanding of international standards make it possible to realize the potential of this structure 100%.

If you plan to scale an insurance business, enter new markets or protect assets – a Malta Protected Cell Company will become your strategic advantage.