A man suspected of being the middleman with information about the murder of investigative journalist Daphne Caruana Galizia in Malta has been granted immunity to reveal what he knows about the killing, Prime Minister Joseph Muscat told parliament late Monday.

The suspect, Melvin Theuma, has turned state's witness and sources close to the police told AFP that he has already given investigators "vital information".

Theuma is now expected to testify before a magistrate to repeat what he told police but this time under oath.

Muscat said the aim of the immunity from prosecution is to establish "all the facts" that Theuma was privy to in connection with the murder as well as other crimes he had been involved in.

The brazen 2017 assassination of Caruana Galizia, described by supporters as a "one-woman WikiLeaks", sparked outrage and protests in the Mediterranean island.

The government repeatedly refused to open a public inquiry into the killing, but made a surprise U-turn in September.

Another suspect in the case, businessman Yorgen Fenech, is being held in police custody.Over the weekend, he was hospitalised after complaining of chest pains but was re-arrested on Sunday and taken back for police questioning.

Fenech also made a request for immunity on Saturday but no decision has been taken yet, sources close to the government told AFP.

Journalist Daphne Caruana Galizia Daphne Caruana Galizia was killed by a car bomb in 2017 after years reporting on corruption in Malta
Journalist Daphne Caruana Galizia Daphne Caruana Galizia was killed by a car bomb in 2017 after years reporting on corruption in Malta AFP / Matthew Mirabelli

Fenech, who reportedly owns a company Caruana Galizia alleged to have links to corruption, was detained on his yacht at dawn last week as he tried to sail away from Malta the day after Muscat promised Theuma immunity to spill the beans.

Investigators have described Fenech as "a person of interest" in the murder of Caruana Galizia, who used her blog Running Commentary to report on corruption in Malta.

Caruana Galizia was killed in a car bomb blast near her home in the small village of Bidnija in northern Malta on October 16, 2017. She was 53 years old.

Three men already face trial accused of carrying out the killing, but the mastermind has not yet been identified.

Fenech is now requesting immunity or some form of arrangement to tell the police what he knows about the murder -- and possibly expose more people in connection with the case. The decision on whether to accept the request lies with Muscat.

Fenech comes from a wealthy family with a sprawling business empire -- from energy to hotels. A leaked Malta Financial Intelligence Analysis Unit (FIAU) report identified him as the owner of a company in Dubai called 17 Black.

Caruana Galizia had written in her blog about 17 Black some eight months before her death, alleging it had connections to high-level Maltese politicians.

On Friday, a police source said they were also questioning Fenech over possible links to money laundering and drugs.

Muscat's offer of immunity for Theuma is conditional on the information about the killing being corroborated. So far, the information has satisfied investigators, sources told AFP.