All CISs, including PIFs, are in the scope of the Investment Services Act (Chapter 370 of the Laws of Malta) and therefore require a collective investment scheme licence to issue or create any units or carry on any activity in or from within Malta.

A promoter may decide to create a PIF in various ways; e.g. an investment company with variable share capital (SICAV), an investment company with fixed share capital (INVCO), a limited partnership, unit trust or common contractual fund.  However, by adopting clear structures and rules while keeping utmost flexibility, the corporate form (SICAV) is the one which is usually preferred by promoters. By virtue of the Maltese Companies Act (SICAV Incorporated Cell Companies) Regulations, it is also possible for a SICAV to be formed or constituted as an incorporated cell company and establish incorporated cells.

It is possible to establish a PIF with just one sub-fund. More common, however, is a structure containing as a multi‐fund (umbrella) scheme, with a number of sub‐funds thereunder, constituted by one or more different classes of shares. The advantage of an umbrella scheme is that it would be possible to have different sub-funds pursuing different investment objectives, policies and restrictions, most probably denominated in different currencies. It is important to point out that sub-funds do not have separate legal personality from the scheme, however, the assets and liabilities of each sub-fund constitute a separate patrimony from the assets and liabilities of other sub-funds. This segregation of assets and liabilities, acts as a safety-valve to the viability of the scheme, and the negative performance of one sub-fund shall have no bearing on any other sub-funds established by the CIS.

All application for licensing of any Collective-Investment-Scheme (CIS) – this includes PIFs as well – must be made to the MFSA, and shall only be accepted if such application is drawn up in proper form, compliant with the relevant legislation, regulations and rules, and the directors and officers are fit and proper persons to carry out the functions required of them in connection with the scheme.

Following the in-principal approval of the directors and officers of the scheme, the applicant must submit the following documents, in draft form, to the scrutiny of the MFSA.

A draft version of the constitutive document of the scheme or the memorandum and articles of association in the case of a SICAV or INVCO);

• A draft copy of the Offering Memorandum;
• A draft copy of the Offering Supplement;
• A draft board resolution confirming:
• The directors’ intention to apply for a licence in favour of the PIF;
• Identifying the person(s) responsible for signing the application documents;
• Identifying the person(s) responsible for acting as a point of liaison with the MFSA;
• Identifying the persons responsible on behalf of the board for the compliance and anti-money laundering regulations;
• Approving and assuming responsibility for the contents of the Offering Memorandum and for the Marketing Document (the Offering Supplement)

The applicant may be asked to provide additional information or to amend the documents accordingly, in order to comply with the Standard Licence Conditions (“SLCs”) established by the MFSA.  When the final tweaks, if any, have been undertaken, in conformity with such SLCs, the applicant shall be asked to submit the original documents.

A PIF may appoint any service provider (e.g. investment manager, adviser, administrator, custodian or prime broker) it deems necessary. Any external service providers appointed by a PIF do not have to be established in Malta.  However, where all service providers are based outside Malta and the PIF has not appointed a local resident director, the MFSA shall require a local representative, as a liaising and reporting officer.