Young people in Malta will soon be able to open their own companies from the age of 16 under a new legal framework announced by the government.

The initiative, known as Intrapriża16, introduces a special type of company called a “Youth Enterprise”, allowing 16- and 17-year-olds to formally start and operate a business before they turn 18.

Prime Minister Robert Abela announced the measure during an event at Ġ. F. Abela Junior College, describing it as a way to remove legal barriers that currently prevent young entrepreneurs from formally setting up businesses.

Under Maltese law today, minors generally cannot incorporate companies, which means teenagers with business ideas often have to wait until they reach adulthood.

The new regulations aim to bridge that gap by creating a regulated structure designed specifically for young entrepreneurs.

How the Youth Enterprise system will work

A Youth Enterprise will function as a private limited liability company, meaning it will have its own legal personality separate from its members.

However, the system includes several safeguards.

Only 16- and 17-year-olds who are residents of Malta will be able to establish such companies, and the business name must include the term “Youth Enterprise” or “YE”.

The regulations also require the appointment of a mentor, who will supervise and guide the young entrepreneurs throughout the life of the company. Mentors are expected to provide advice, monitor progress, and review financial records, although they will not be allowed to run the company’s day-to-day operations.

Parents or guardians must also formally consent to the minor’s participation.

Capital, training and restrictions

Youth Enterprises must have share capital between €100 and €20,000, with at least €100 paid up by each member. All members will have equal voting rights.

Members will also need to complete at least 20 hours of training each year in areas such as business management, financial literacy and compliance.

The framework also places several limitations on these businesses.

Youth Enterprises cannot hire employees, and their activities are restricted where licences or permits are required, unless those licences can legally be issued to minors.

Shares cannot be transferred to third parties, and the company must qualify as a small enterprise under VAT rules.

What happens when members turn 18

The structure is designed as a stepping stone to adult entrepreneurship.

Once all members reach the age of 18, they will be able to apply to convert the Youth Enterprise into a standard commercial partnership.

If the company is not converted, members must step down and the business may be struck off the register.

The regulations also introduce simplified procedures for dissolving the company if the members decide to close it.

Government says measure will encourage entrepreneurship

The government said the initiative is intended to help young people turn ideas into real businesses while learning financial responsibility and leadership.

The system will be overseen by the Malta Business Registry, with support from Aġenzija Żgħażagħ and entrepreneurship organisation JA Malta.

Officials say Malta will be among the first European countries to introduce a legal structure specifically designed to allow teenagers to start companies under a regulated framework.