MMLA

Malta Maritime Law Association

Member of the Comité Maritime International

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MMLA AGM 2021

December 7, 2021 Leave a Comment

The MMLA recently held the AGM 2021. The meeting took place in a hybrid form with most of the Executive Committee members present in person and other members joining virtually. President Dr Ann Fenech opened the meeting with an update on the latest developments regarding the Beijing Draft Convention on the Effects of Judicial Sale of Ships. This was followed by a presentation by Dr Jotham Scerri Diacono on the workings of the subcommittee revising the MSA while Dr Adrian Attard explained the workings of the same subcommittee with regard to the Revision of the COCP.

After the President’s Report, the Reports of the active Subcommittees and the Treasurer’s Report and approval of the Budget 2022 the new Executive Committee was elected. The present officers were re-elected confirming President Dr Ann Fenech, Vice Presidents Dr Suzanne Shaw and Dr Matthew Attard, Secretary Dr Stephan Piazza and Treasurer Dr Nicholas Valenzia. Also re-elected were Dr Katrina Abela, Dr Lisa Camilleri, Dr Chris Cini, Dr Anthony Galea, Dr Anndrea Moran, Dr Robert Radmilli and Dr Jotham Scerri Diacono as members while Dr Alison Vassallo decided to step down in view that her new commitments in the yachting sector would take up her time. We thank her for her invaluable contribution over the years and welcome Dr Adrian Attard who was elected as a new member to the MMLA Executive Committee.

Filed Under: Latest, MMLA

MMLA President re-elected CMI Vice-President

October 1, 2021 Leave a Comment

President of the Malta Maritime Law Association Ann Fenech has been re-elected to serve as Vice President of the Comite Maritime International for a further 3 years.  She was elected unanimously by the member national maritime law associations of CMI during the CMI Assembly held virtually on 30 September 2021. Dr Fenech currently co-chairs the International Working Group on Judicial Sales and is the CMI co-ordinator for this project at UNICTRAL currently deliberating the 4th Annotated Revision of the Beijing Draft Convention on the Effects of Judicial Sale of Ship.

Filed Under: CMI, Latest, Malta, MMLA

MMLA ExCo meeting

September 30, 2021 Leave a Comment

Notwithstanding the continuous threat from COVID-19 the MMLA has continued with its activities throughout these challenging 18 months.   The latest meeting of the Executive Committee took place on Tuesday 28th September in a hybrid form with some members present and others joining virtually to discuss topical issues including the 4th Revision of the Draft Convention of Judicial Sales currently being deliberated by Working Group V1 of UNCITRAL and a host of other issues, whilst planning future meetings and international events.

Filed Under: CMI, Latest, Malta, MMLA

A critical benefit of the Maltese Maritime Flag: Court-approved private sales

January 22, 2021 Leave a Comment

The continued success of the Maltese Maritime Flag can be greatly attributed to the protection given to financiers and creditors of vessels registered under the Maltese Flag.

A ‘judicial sale’, as defined by Lief Bleyen, is the “sale of a ship by a competent authority by way of public auction or private treaty…by which Clean Title to the Ship is acquired by the Purchaser and the proceeds of sale are made available to the creditors.” Act XIV of 2006 amended Article 358 of the Code of Organisation and Civil Procedure (‘COCP’), introducing a novel procedure of Court-approved private sales for aircraft and vessels in addition to the traditional judicial sale by auction. Therefore, under Maltese law, there are two types of judicial sales:

1. Traditional judicial sale by auction; and

2. Court-approved private sales.

In a judicial sale by auction, the vessel is sold to the highest bidder in Court, with no reserved price mechanism in the case of vessels exceeding 10 metres in length. This creates a certain ambiguity surrounding the creditors, as they would not be aware whether the sum agreed to by a buyer as the highest bidder in Court would cover, or even come close to what such creditor or creditors, are owed. This type of judicial sale of a vessel is a rather risky one, as it may eventually lead to a situation where a creditor/s remains unpaid once the vessel is sold.

Prior to the introduction of Court-approved private sales in 2006, creditors had the option of negotiating private sales. However, such sales were largely disregarded by buyers since the imperative “executive title” would not be guaranteed. This inevitably led to a situation where the buyer would not purchase an aircraft or vessel free and unencumbered from any liabilities connected to the vessel. This highlights the importance of the amendment to the COCP which brought about an overhaul of the already-existing private sale.

In Court-approved private sales, commonly referred to as ‘hybrid sales’, the mortgagee agrees on a price with the buyer, obtains valuations of the vessel through physical inspections, and if the sale price exceeds the highest valuation, the mortgagee will apply to the Court for the sale to be approved. In this type of sale, the creditors will then seek settlement from the sale price. Court-approved private sales amalgamate the advantageous characteristics of a private sale, i.e. the possibility of negotiating the price, as well as providing the prospective purchaser with an executive title; a modification which seeks to bridge the gap between both types of sales. This introduction is a powerful tool for creditors and financiers where, in the event of default, the vessel can be arrested and sold in a judicial sale without the need of commencing an action on the merits.

Despite being introduced around 15 years ago, the first time that this amendment was used was in the ‘Thor Spirit’ case in 2011. The entire procedure was concluded in around two weeks, proving to be expeditious and highly cost-efficient.

Since the ‘Thor Spirit’ case, the Maltese Courts have continued to approve private sales of vessels in numerous judgments. Examples of such cases include the 2013 Blankenese case and the 2014 MV Ladybug case. Further cases such as the HHL Rio de Janeiro case decided in 2019, also dealt with Court-approved private sales. In the latter case, the sale was finalised within 20 days, once again highlighting the transparent and efficient nature of Court-approved private sales.

The role of the Court in this type of sale is not one which is solely limited to rubber-stamping but pursues a somewhat proactive role, ensuring that the application of this procedure is carried out in a consistent manner, in line with the appropriate administration of justice, as well as the bona fide principle being respected by all affected parties.

THE CMI BEIJING DRAFT

Despite there not being international consensus regarding the judicial sale of vessels, it appears that the Comité Maritime International (‘CMI’) is definitely paving the way for results. The CMI is recognised as the oldest organisation worldwide which is exclusively concerned with the unification of Maritime law and related commercial practices. Back in 2008, the Executive Council of the CMI launched an International Working Group on the Judicial Sale of Ships, with the aim of studying the challenges associated with the failure of the recognition of such judicial sales. Eventually, in 2012 the CMI issued the Beijing draft, which was subsequently approved in 2014.

The Beijing Draft deals solely with the recognition of judicial sales, providing that notices must be given to persons indicated in the clause (including owners, mortgagees, holders of registered titles and lien holders) within 30 days prior to the judicial sale. The Draft reaffirmed that ships must be sold free and unencumbered, where the purchaser shall acquire clean title over the vessel. It also provides for the issuance of a Certificate by the authority ordering the sale, certifying that the vessel is free and unencumbered, and that all rights previously existing against the ship are extinguished.

In 2017, the CMI submitted its proposal to the United Nations Commission on International Trade Law (‘UNCITRAL’). Following this, a joint Colloquium was held in February 2018 in Malta between the CMI, the Malta Maritime Law Association and the Maltese Government. Various attendees, including ship owners, ship repairers, banks, and financiers encouraged the creation of an international instrument which would finally regulate this area to improve the organisation, stability and certainty of international trade.

The UNCITRAL Working Group V1 met in December 2020 to discuss the Beijing Draft. The final result remains an international Convention where the free and unencumbered title in a vessel purchased in a judicial sale is recognised by State parties, guaranteeing that such vessel fetches the maximum price in a judicial sale for the benefit of the creditors, guaranteeing at the same time, the peaceful possession and use of the newly purchased vessel by the bona fide purchaser.

By Katrina Abela, Aleandro Mifsud and Nina Fauser, GVZH Advocates

Source: Lexology

Filed Under: CMI, International Law News, Judicial Sales, Latest, Malta Flag, MMLA, UNCITRAL

MMLA President at UNCITRAL Working Group VI first meeting held in New York on the International Recognition of Judicial Sales

May 31, 2019 Leave a Comment

Between the 13th and 17th of May 2019, President of the MMLA, Dr Ann Fenech  was at the first meeting of UNCITRAL Working Group VI which has been tasked with considering the draft convention presented by CMI on the International Recognition of Judicial Sale of Ships.

Dr. Fenech participated in this meeting at  UNCITRAL in her capacity of Vice President of CMI and as CMI co-ordinator for the project at UNICTRAL.

This was the first meeting of the Working Group VI attended by States members of UNICTRAL during which Dr. Beata Czerwenka was appointed Chairman of Working Group VI.

During this first meeting lasting an entire week,  the Swiss Delegate Prof. Alex von Zeigler, a member of the Executive Council of CMI, presented the project since it was on the proposal of Switzerland last July 2018 that the 51 Assembly of UNICTRAL accepted to take on this work as part of its programme.

As CMI co-ordinator for the project Dr. Fenech was tasked with giving a preliminary explanation of each proposed article to the convention.  There was agreement on  the usefulness of the CMI draft to be used as the basis for any future work.  The entire week was taken up with the explanations and answering of questions raised by all the delegations present.  It was concluded at this first meeting that the UNCITRAL secretariat will now work on another draft taking into account the various ideas expressed and that the  next draft will be the subject matter of the next Working Group VI meeting in Vienna in November of this year.

Filed Under: CMI, International Law News, International News, Judicial Sales, Latest, Malta, MMLA, Uncategorized

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News & Publications

  • New MMLA President and Executive Committee elected December 28, 2022
  • A way forward for Malta’s maritime industry – William Vella November 21, 2022
  • Dr Ann Fenech elected CMI President October 24, 2022
  • MMLA President Dr Ann Fenech on The Judicial Sales of Ships August 9, 2022
  • MMLA President at UNCITRAL in New York July 11, 2022
  • Meeting with the Minister of Justice May 30, 2022

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Malta Maritime Law Association (MMLA)
Sa Maison House
Sa Maison Hill
Floriana FRN 1612
MALTA
E: mmla@mmla.org.mt
T: (+356) 25 594 118
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International Events

The 2022 CMI Conference took place in Antwerp, Belgium from 18-21 October. Antwerp is the birthplace of the Comite’ Maritime International and this year celebrated its 125th anniversary.

The CMI Virtual Assembly was held on 30 September 2021

The CMI Assembly and Colloquium was held in Mexico City between 30 September – 2 October 2019: Find out more…

The CMI held the Assembly meeting and other events on 8./9. November 2018 in London. Find out more…

The Malta Colloquium on Judicial Sales was held on 27 February 2018 in Valletta. Find out more…

 

 

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