The rich knowledge of Malta’s shipping industry cannot be found anywhere else.
Article, Fairplay.co.uk ‘Looking beyond the Registry’ [09-05-11]
The rich knowledge of Malta’s shipping industry cannot be found anywhere else.
Article, Fairplay.co.uk ‘Looking beyond the Registry’ [09-05-11]
The role of the flag state is vital in the armed guards’ debate.
Matthew Attard of Ganado & Associates assesses the flag state’s responsibilities. See the full article in pdf in ‘Fairplay’ published 21 April, 2011.
First appeared: The Malta Independent Daily, Friday, 15 April 2011
The Regional Marine Pollution Emergency Response Centre for the Mediterranean Sea (REMPEC) has for well over three decades played a prominent role in the advancement of maritime standards and environmental protection in the Mediterranean region.
This challenge is all the more real in the Mediterranean Sea, which has a high traffic density while also being a semi-enclosed sea and therefore far more vulnerable to the effects of pollution. REMPEC’s scope has evolved over the years in line with a growing public awareness of the responsibility we all share for protecting the seas through effective management of maritime and marine resources.
The centre has its roots in the establishment of the Mediterranean Action Plan (MAP) in 1975, following the creation of the United Nations Environment Programme (UNEP) – Regional Seas Programme. MAP was the first such Action Plan to be implemented, and set out with the aim to assess and control marine pollution, to assist Mediterranean countries in formulating their national environment policies, to improve the ability of governments to identify better options for alternative patterns of development, and to optimise the choices for allocation of resources.
It was in 1976, within this MAP framework, that the Regional Oil Combating Centre (ROCC) for the Mediterranean Sea – REMPEC’s predecessor – was set up in Malta. ROCC was the first such regional centre in the world and, after 11 years of operation, its mandate was expanded to include “hazardous substances other than oil.”
In 1989, once the centre’s new objectives and functions were approved, it assumed its present name: Regional Marine Pollution Emergency Response Centre for the Mediterranean Sea (REMPEC). REMPEC, like ROCC before it, is administered by the International Maritime Organisation (IMO), and operates on the basis of the decisions of the contracting parties to the Barcelona Convention which also provide its core funding.
In 2001, REMPEC’s objectives and functions were further modified, this time in view of the adoption of the new Protocol concerning Cooperation in Preventing Pollution from Ships and, in Cases of Emergency, Combating Pollution of the Mediterranean Sea (Prevention and Emergency Protocol).
This new protocol, which was adopted on 25 January 2002 in Malta and entered into force on 17 March 2004, sets the main principles of co-operation in dealing with threats to the marine environment, the coasts and related interests of the contracting parties posed by accidental releases or by accumulations of small, operational discharges, of oil or other harmful substances.
As a Regional Activity Centre of the Mediterranean Action Plan (UNEP/MAP), REMPEC assists the Mediterranean coastal states in ratifying, transposing, implementing and enforcing international maritime conventions related to the prevention of, preparedness for and response to marine pollution from ships.
In fulfilling these duties, REMPEC actively promotes regional co-operation and dialogue in the field of prevention of, preparedness for and response to pollution of the marine environment from ships, thereby establishing a platform for conducting co-ordinated actions at national, regional and global levels. These efforts tie in and are supported by REMPEC’s work towards providing a framework for the exchange of information on operational, technical, scientific, legal and financial matters.
In 2004, the European Commission (EC) approached the International Maritime Organisation (IMO) to develop a Euro-Mediterranean (Euromed) cooperation project on maritime safety and prevention of pollution from ships (SafeMed) within the framework of the Euromed Transport Forum. REMPEC was identified as the most appropriate regional institution for the implementation of the SafeMed Project considering its links with the IMO and the important role the centre plays in this field within the framework of UNEP’s MAP.
In view of the results of the first phase of the project which extended from 2006 to 2009, the EC has decided to entrust REMPEC with the second phase, SafeMed II, which will extend until the end of 2011. REMPEC has been hosted in Malta since its establishment in 1976.
In December 2007, however, the centre moved from its former offices in Manoel Island and began operating from offices situated at ‘Maritime House’, Lascaris Wharf, Valletta, which were made available and renovated by the Government of Malta. The ‘Maritime House’ building enjoys a prominent location in the Grand Harbour while also providing more modern office facilities.
Visit rempec.org for further information on the centre’s history as well as relevant information concerning REMPEC, its legal framework, its mandate, its activities, and detailed information resources pages providing documentation related to the activities implemented by the centre
ILO – Contributed by Fenech & Fenech Advocates
In 2010 the Maltese courts issued their highest-ever damages award in a case involving a failure to transfer shares in a company that was the owner of a new Aframax tanker.
Italian company Finaval filed an action against Monegasque company Scorpio Ship Management and others for breach of a promise to sell shares in a Maltese registered company which had been formed for the purposes of entering into a shipbuilding contract with shipbuilder Samsung. Finaval claimed that Scorpio had promised Finaval that before delivery of the Aframax tanker to the Maltese company, Scorpio would give Finaval the option to purchase shares in the Maltese company equivalent to the contract price of the vessel plus the pre-delivery costs, calculated at $37.8 million.
Scorpio failed to offer the shares as promised to Finaval, with the result that Finaval lost the opportunity to purchase shares in a company which would own a brand-new Aframax tanker at the price of $37.8 million at a time when the price of Aframax tankers was rising considerably.
Finaval requested the court to:
• declare that Scorpio had breached its obligation to transfer the shares;
• order the transfer of the shares to Finaval; and
• in the eventuality that the ship had already been transferred by the company,
order the defendants to pay damages.
Scorpio defended the claim by stating primarily that the Maltese courts did not have jurisdiction over the matter, given that neither Finaval nor Scorpio was Maltese. Scorpio further claimed that it should be declared non-suited since it did not own the shares in the Maltese company and had no control over the disposal of shares belonging to other entities. Finally, it claimed that in any event, there was never a promise of sale.
First instance decision
On December 2 2004 the first court delivered its judgment on jurisdiction. It held that the jurisdiction of the Maltese court was founded on Section 742(c) of the Code of Organisation and Civil Procedure, which states that the courts of Malta have jurisdiction over “any person in matters relating to property situated or existing in Malta”. Thus, it was irrelevant that neither Finaval nor Scorpio was Maltese. The court further held that, as established by previous case law, shares in a Maltese company very much constitute “property situated in Malta”, and that the very nature of the claim put forward by Finaval was for the transfer of shares in the company. With respect to Scorpio being non-suited on the basis that it had no control over disposal of the shares, the court rejected this argument completely. The court held that:
“Scorpio had obliged itself to transfer to Finaval the shares which it had registered in someone else’s name. Scorpio has to see for itself how it was going to fulfil the obligation it assumed. A debtor of an obligation cannot escape from its execution when he himself would have led to its impossibility.”
On July 5 2007 the same court gave its judgment on the merits and, on the basis of the evidence produced, accepted Finaval’s claim that there had been a promise of sale of the shares contained in a letter sent from Scorpio to Finaval dated December 24 2002, and that the promise had been broken when the shares were not transferred. The court confirmed that all of the requirements stipulated by Article 1357 of the Civil Code had been satisfied because:
Since the Maltese company which had entered into the shipbuilding contract with Samsung was subsequently struck off, the court ordered Scorpio to pay Finaval $22.2 million – the difference in price between what Finaval would have paid had the shares been transferred and what it would have paid for the same type of vessel on the open market at the time when the vessel would have been delivered (estimated at $60 million).
The court also ordered Scorpio to pay all of the court costs and interest from the date of commencement of the action up until the date of payment. Scorpio appealed.
The Court of Appeal rejected Scorpio’s defence of lack of jurisdiction, since the merits related to shares in a company registered in Malta and the shares were to be considered as “property situated in Malta” and thus to be covered by Article 742(c) of the Code of Organisation and Civil Procedure. The court held that the fact that the shares in the company could no longer be transferred because the Maltese company had been struck off during the running of the case – meaning that all that remained was a claim requesting damages for an alleged breach of a promise to sell the shares – had no bearing on jurisdiction, because the jurisdiction of the courts was established at the time when the action was instituted, which was when the company was still registered and had not yet been struck off.
The court also confirmed the first instance judgment on the merits, stating that Scorpio had indeed promised Finaval the option to purchase shares in a company destined to own an Aframax tanker. The court confirmed the view of the first court that once it had been established that the letter of December 24 2002 amounted to a promise, it had to assess whether that promise satisfied all of the requirements stipulated by Article 1357 of the Civil Code, which it did.
The court rejected Scorpio’s additional submission that since the document did not contain a jurisdiction clause, it could not have been intended as a binding document. The court underlined the fact that a promise to sell a moveable object, such as the shares in question, need not even be in writing, and that consequently the promise of sale was valid irrespective of whether the letter contained a jurisdiction clause. Thus, the court concluded that since,
by virtue of the letter of December 24 2002, the object of the promise had been the shares in the company which had to be transferred to Finaval any time before delivery of the vessel, by means of a sale against payment to Scorpio of the equity and predelivery costs, all of the requirements stipulated in Article 1357 of the Civil Code had been satisfied and the pre-contractual stage had long passed.
The court also rejected Scorpio’s position that Finaval had not accepted Scorpio’s offer because the substantial evidence that was brought forward during the running of the case, including Finaval’s full participation in the discussions and negotiations over the specifications and delivery of the new building, proved the opposite. The court
rejected Scorpio’s position that it had nothing to do with the matter and should not be held liable. The court added to the findings of the first instance court and stated that:
According to the letter, Scorpio had to order the vessel and provide the equity, and when the shares were transferred to Finaval, Finaval had to pay Scorpio and no one else. The court held that “this Court agrees with the first Court when it decided that Scorpio should be declared as solely responsible”.
The court also confirmed the first instance decision on the damages awarded, which was the difference between the price which Finaval would have paid for the shares had they been transferred as promised and what it would have cost to purchase a vessel on the open market at the time when the vessel was meant to have been delivered, which the court estimated at $22.2 million, based on the expert evidence of a shipbroker. However, the court ordered that interest be paid by Scorpio from the date of the judgment, rather than the date on which the action was filed. It also
confirmed the first instance order on costs, obliging Scorpio to bear the costs.
For further information on this topic please contact Ann Fenech at Fenech & Fenech Advocates by telephone (+356 2124 1232), fax (+356 2599 0645) or email <a href=”mailto:firstname.lastname@example.org”>email@example.com</a>.
More than 70 professionals attended the Malta Maritime Law Association’s seminar on the updated Commercial Yacht Code. Malta has just issued a revision of the code which will serve the needs of the yachting industry better while allowing for its developing technological advancements in conformity with international regulations and safety standards.
After an opening address by MMLA president Ann Fenech, Karl Briffa, flag and port state control inspector at Transport Malta’s Merchant Shipping Directorate explained the concept behind the Malta Commercial Code.
Launched in 2006 and amended in 2010, the code aimed to offer a proposition to owners and superyacht operators looking for a serious regulatory framework within which to register their yachts commercially. He explained how the code has been developed on industry established standards bringing together solutions for both yachts below and above 24 metres.
Commercial yachts registered under the Maltese flag has increased especially since 2006, with more than 150 yachts with an average length of 30 metres registered as commercial yachts. The Updated Commercial Yacht Code 2010 will apply to commercial yachts the keels of which are laid or which are registered under the Malta flag from January 2011.
Commercial yachts registered under the Malta Flag whose keels were laid before January 1, 2011, must comply with the requirements of the code by the first survey due on or after March 1 but by not later than December 31. Paul Cardona of Marine Industrial Consultancy Services highlighted the differences between the Maltese Code and other Codes, particularly the MCA Code.
Given his extensive experience, he was able to share instances which threw light onto the manner in which owners, yards, classification societies and various administrations need to act and interact.
The latest Assembly and Colloquium of the Comité Maritime International (CMI) was held in Mexico City from 30 September – 2 October 2019. Find out more…
The Comité Maritime International (CMI) held its 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…