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Malta Maritime Law Association

Member of the Comité Maritime International

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Commercial Yacht Code 2020

December 1, 2020 Leave a Comment

We are pleased to announce that the Merchant Shipping Directorate within the Authority of Transport in Malta has rolled out its 4th edition of the Malta Commercial Yacht Code 2020 (Code) which updates and replaces the Commercial Yacht Code 2015 (CYC 2015).

The substantial increase in the number of superyachts which the Malta flag has continued to lure to its Register has seen the Merchant Shipping Directorate being sensitive to the fast-changing technological developments which this particular industry attracts. Drawing on its own experience of an already well established yachting industry and heeding the technical and commercial advice of yacht builders, repair yards, Classification Societies and industry stakeholders at large, the Merchant Shipping Directorate has come up with an improved Code that mirrors the yachting industry’s realities and ensures a greener and safer commercial yacht fleet for the Malta flag.

The Code comes into effect as of the 1st January 2021 however for existing yachts certificated in accordance with the CYC 2015, compliance with the new Code shall be by not later than the yacht’s first periodical survey carried out after the 1st June 2021.

The amendments and additions introduced by the Code are several and varied and largely seek to enhance the safety aspects of commercial yachting as well as to cater for the particular technological market demands of the industry – all this in conformity with safety and international regulations and standards.

The revisions, all of which are conveniently listed in Annex 1 of the Code, provide, inter alia, for improvements on the safety of passengers at sea, the well-being of the seafarers engaged onboard, the enhancement of the structural aspects of yachts, the provision for innovative designs and requirements covering electrically powered and/or hybrid engines and plants. The Code further provides for the improvement of the protection of the marine environment by introducing the requirements of the Ballast Water Management Convention and furthermore dedicates a section of the Code to the design, construction and safety of Helicopter Landing Areas.

More specifically, amendments made relate to the following sections:

• Definitions (Section 2), • Application and Interpretation (Section 3), • Structural Strength and Watertight Integrity (Section 4), • Rigging on Sailing Yachts (Section 5) • Machinery (Section 6), • Electrical Installation (Section 7), • Intact and Damage Stability (Section 8), • Life Saving Appliances (Section 10), • Fire protection (Section 11), • Equipment (Section 12), • Maritime Labour Convention 2006 (Section 13), • Protection of Personnel (Section 14), • Navigation and Communication (Section 15), • Marine Pollution Prevention section (Section 16), • Manning and Crew Certification (Section 17), • Medical Stores (Section 19), • Survey and Certification (Section 20), • Tenders and Ancillary Craft (Section 22), • Static Chartering (Section 23), • Helicopter Landing Areas (Section 24).

By Rowena Grima and Stephanie Farrugia, Fenech & Fenech Advocates

Source: Lexology

Filed Under: Latest, Malta, Malta Flag, Maltese law, Uncategorized, Yachting

Malta – Recent Changes to Laws Regulating Shipping Companies

May 13, 2020 Leave a Comment

The Merchant Shipping (Shipping organisations – Private Companies) Regulations (Subsidiary Legislation 234.42 of the Laws of Malta, “the Regulations”) have recently been amended by Legal Notice 31 of 2020 published in the Government Gazette on the 21st of February 2020.

Originally promulgated in 2004, the Regulations address the establishment and corporate workings of what is typically referred to as the Maltese shipping company.

Well known by players in the international shipping industry, shipping companies incorporated under the Regulations are used for the ownership, operation, and management of merchant vessels (both Malta-flagged or flagged elsewhere) as well as other maritime-related activities.

Legal Notice 31 of 2020 has now further improved the legislative and regulatory position in the area.

Continuation of foreign companies in Malta and vice-versa

Continuation (sometimes referred to as re-domiciliation) entails the transfer of a corporate entity’s ‘seat of incorporation’ or registration from one jurisdiction to another, thus ensuring the continuing corporate existence of the migrating entity.

Continuation seeks to ensure the continued existence of the same legal person. Accordingly, the company retains all the assets, rights, liabilities and obligations previously held or due by it.

Re-domiciliation into Malta is a useful and advantageous route for those existing shipping companies or shipping groups wishing to move their corporate seat to Malta. Existing shipping companies incorporated elsewhere may retain their corporate existence, instead of incurring winding up costs or leaving them idle whilst incurring costs to keep them in good standing, combined with the cost of incorporating a new company in Malta.

The continuation of a foreign shipping company into Malta may also be considered in connection with the simultaneous flagging of new tonnage or the re-flagging of existing tonnage under the Malta flag. Indeed, the whole re-domiciliation exercise, combined with the registration of the underlying owned or operated vessels in Malta, may well serve as a point of entry into the Maltese tonnage tax system.

Whilst re-domiciliation laws for non-shipping companies have been enacted in Malta a number of years ago, Legal Notice 31 of 2020 has brought about a novel faculty for Maltese shipping companies. Prior to 21st February 2020, a foreign shipping company wishing to re-domicile to Malta would first need to do so as a non-shipping company and subsequently convert to a shipping company post re-domiciliation.

This time consuming and burdensome procedure has now been removed through the introduction of Legal Notice 31 of 2020.

The Regulations now govern both the continuation in Malta of a foreign corporate entity as well as the continuation of a Maltese company in a country or jurisdiction outside Malta.

Re-domiciliation is only possible if the laws of the concerned jurisdiction (other than Malta) allow so.

Additionally, re-domiciliation may only take place when the foreign jurisdiction is considered as an “approved country or jurisdiction”. In this regard, the Registry relies on the Financial Action Task Force (FATF) country evaluations and treats as an approved jurisdiction a country that is not on the FATF blacklist.

Reporting & filing obligations for shipping companies

Starting from financial year 2020, shipping companies are requested to keep accounting records in accordance with the Regulations and will be subject to the exemptions and disclosure requirements as detailed in the said Regulations. Shipping companies will, therefore, need to prepare financial statements in accordance with the Regulations and the relevant applicable financial reporting standards such as GAPSME or IFRS.

Shipping companies will now submit audited financial statements to the Registrar of Companies. Submission must be made within 42 days from the end of the period for the laying before and approval by the company in general meeting of the annual accounts, that is 10 months after the end of the applicable and relevant accounting reference period.

Simply put, the large majority of shipping companies having their respective year-end in December must make their first filing of their audited accounts for financial year 2020 towards early December 2021.

A “small” shipping company is exempt from the general requirement to prepare a directors’ report. A “small” shipping company is one which, in terms of Regulation 64 of the amended Regulations, does not exceed two of the below thresholds:

  • A balance sheet total of € 6,000,000
  • Turnover of € 12,000,000
  • Not more than fifty employees

At a parent company level, exemptions from the preparation of consolidated accounts are also present. A parent shipping company incorporated under the Regulations can qualify as a “small company” in terms of the foregoing only if the group of which it is parent qualifies as a small group, meaning that, on a consolidation basis, it does not exceed the limits of two of the following criteria:

  • An aggregate balance sheet total of € 6,000,000 net or € 7,200,000 gross
  • An aggregate turnover of € 12,000,000 net or € 14,400,000 gross
  • An aggregate number of fifty employees

The above-described size exemption applicable to the preparation of consolidated accounts does not seem to apply in the event that the parent shipping company, or any of its undertakings to be consolidated, have their securities listed on a regulated market and in the event that none of the group companies are public interest entities.

Other

An additional Schedule – the Tenth Schedule – has been added to the Regulations. This Schedule lists a number of administrative penalties which may be imposed by the Registrar of Companies in the event of a number of defaults concerning failure by a shipping company and its officers to abide by their notification and filing obligations with respect to annual accounts as well as other matters concerning corporate governance.

by Ganado Advocates

Source: Lexology

Filed Under: Malta, Malta Flag, Maltese law, Maritime Registration, Uncategorized

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

Joint Communiqué

November 20, 2017 Leave a Comment

The Malta Maritime Law Association, Malta Maritime Forum, The Yachting Trade Section within the Malta Chamber of Commerce and Super Yacht Industry Network Malta have issued a communiqué in reaction to the articles reported in the press on a communication sent by the French Commissioner Pierre Mascovici to Minister Scicluna regarding the application of rules on VAT relative to yachts.

Read the full text

Filed Under: Latest, Malta, Superyachts, Taxation, Uncategorized

New Guidelines on Private yacht carriage capacity

April 12, 2017 Leave a Comment

At the start of 2017 Transport Malta, the authority responsible for the administration of the Malta flag, introduced new guidelines that allow more than 12 persons on board privately registered yachts.

Since their launch, these guidelines have been welcomed by the industry, not least since they represent the consolidation of a flexible approach towards authorisation for the carriage of additional guests on board and a departure from the previously strict requirement for yachts to be built in accordance with the International Convention for the Safety of Life at Sea or the Passenger Yacht Code and registered with a red ensign flag.

These guidelines apply to yachts both above and below 500 gross tonnes and will be applied on a case-by-case basis at the discretion of the authority. Further, pleasure yachts falling within the ambit of the guidelines will be prohibited from navigating more than 150 miles from a safe haven while carrying more than 12 persons.

Requirements

Yachts falling under the guidelines must:

  • hold a valid class certificate (a requirement applicable for yachts over 500 gross tonnes);
  • comply with the requirements of the Commercial Yacht Code;
  • possess an approved stability booklet, which covers the loading conditions relative to the total number of persons being requested on board;
  • install and carry the appropriate safety equipment, depending on the expected number of persons on board;
  • have a 100% life raft capacity;
  • carry a compliment crew in line with the Commercial Yacht Code;
  • have been issued a safety radio statement of compliance (applicable to yachts over 300 gross tonnes) or a safety radio certificate (for yachts over 500 gross tonnes); and
  • comply with the International Convention for the Prevention of Pollution from Ships requirements, as detailed in the Commercial Yacht Code.

The guidelines also require an intermediate survey to be effected every two-and-a-half-years, starting from the date on which the vessel is allowed to carry more than 12 persons. The aim of this survey is to verify the continued compliance with the minimum requirements.

Comment

The Malta flag has increasingly garnered a solid reputation as being one of the leading European flags and is favoured by owners, financiers and operators of private and commercial yachts. Speaking at the Fifth Opportunities in Superyachts Conference organised in Malta on the February 23 2017, Minister for Transport and Infrastructure Joe Mizzi noted a record increase of over 14% in the registration of superyachts over 24 metres under the Malta flag over the past year. He attributed this success to the high level of service offered by both the public and private sectors and the “various initiatives and strategies in favour of the industry offering a holistic package”.

The new guidelines stem both from a recognition by the Maltese administration that there is a gap in the superyacht market and the administration’s continued effort to remain at the forefront as a leading yachting flag, which is conscious of the need to meet the industry’s frequently changing requirements while maintaining the highest possible technical standards.

Contributed by Alison Vassallo, Fenech & Fenech Advocates

Source: ILO 12 April 2017

Filed Under: International Law News, Latest, Malta, Malta Flag, Superyachts, 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)
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Floriana FRN 1612
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E: mmla@mmla.org.mt
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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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