A mortgage over a Malta-flagged vessel may be drawn up to secure the payment of a principal sum and interest, an account current or the performance of any other obligation – including a future obligation – due to a creditor by the debtor. The parties to an underlying security document may enter into negotiations resulting in changes to the terms set out in the security document. The question that therefore arises is whether a mortgage amendment should be registered to reflect the new terms.
Four new legal notices were recently published in the Government Gazette. However, these were short lived, as just a few days later, ministry representatives reportedly declared that the legal notices would be suspended. While it is uncertain whether the Annual Leave National Standard Order will be enacted, it is worthwhile to analyse the proposed changes, as these would alter current employment law should they come into force.
The registration of a mortgage over a Malta-flagged vessel in favour of an individual, corporate lender or security trustee (the mortgagee) requires the filing of a statutory mortgage instrument (the deed) at the Maltese Ship Registry. However, what happens if the original mortgage instrument is misplaced? Maltese law affords two remedies in such instances; the chosen remedy will depend on the remaining duration of the registered security.
Recent amendments to the Civil Code concerning contracts of lease have bolstered the rights of lessors of aircraft such that they are now not materially different to those granted to the holders of security interests in terms of the Cape Town Convention. Aircraft leases are now akin to security interests and grant important rights and remedies to lessors and financiers. The changes better reflect the commercial realities underlying the aircraft lease relationship and should continue to improve Malta's legislative framework in this area.
Four new legal notices affecting employment laws were recently published in the Government Gazette. Whether the notices must be considered as law and enforceable before the Maltese tribunals and courts is now the subject of debate. However, it is clear that the government intends to introduce some piecemeal changes that will affect employers significantly, including new rules on payslips that all employers – irrespective of size – must issue and new limitations on holiday leave arrangements.
If enacted, a recently published legal notice will introduce amendments to the Temporary Agency Workers Regulations, including expanding the concept of assigned temporary workers, redefining 'pay' and removing the equal pay rule exception. This article summarises the proposed amendments to the regulations and raises some pertinent questions.
The June 2018 sale of the Indian Empress has attracted the attention of the superyacht community worldwide and international brokers, the international yachting media and potential owners and creditors of the yacht are watching this space very closely. This was the first time that a Maltese court ordered bidders in a judicial sale by auction of vessels to make a cash deposit in court prior to the sale taking place and the first time that a bidder was held liable for the payment of the difference.
While the rights of third-party owners of installed engines were recognised prior to amendments introduced in 2016, the protection of those rights was subject to serious procedural limitations which came to light in several related cases. Following the decisions in these cases, the law was amended so that it is now provided that the court seized with the acts of a warrant of arrest of an aircraft will also be competent to hear an application by the owner of an installed engine which does not belong to the aircraft owner.
Following the collapse of OW Bunkers, physical bunker suppliers worldwide have had to rethink their business model with respect to the potential debt exposures that they face when conducting business through bunker traders. The matter is further complicated due to the fact that in many cases, there is not just one bunker trader involved, but rather a series of intermediaries, brokers and intermediary traders.
Maltese income tax legislation provides specific rules for determining the types of expense that are deductible against income. Legal Notice 67 of 2018 on tax deductions for employee transportation costs provides for a new tax deduction. The new rules will apply to transportation costs incurred for the transport of employees from assessment year 2018 and will remain in effect until assessment year 2020.
While primarily introduced to amend and update the Aircraft Registration Act and other ancillary-related laws, Act LII/2016 also promulgated particular amendments which go beyond aviation law into the realm of shipping. These recent changes are making Maltese law an ideal legal regime to govern and regulate disputes which may arise under certain types of shipping contract – namely, ship sale and purchase agreements, promise of sale agreements and charterparties.
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. The new guidelines stem both from a recognition 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.
Following the issuance of a provisional arrest warrant at the request of a physical bunker supplier, the Maltese court determined that it was not vested with jurisdiction in rem and accordingly lifted the arrest. This judgment sheds important light on the onus of proof with which an arresting creditor is burdened. The court held that it was insufficient merely to procure evidence of knowledge of the supply or proof of acceptance of the product from the supplier.
The term 'Maritime Malta' perfectly describes Malta – a country which has always had close connections with the sea and maritime sector. In addition to its strategic position, Malta has a stable and reliable legal regime and laws which give investors and their financiers a high degree of confidence. These achievements are a direct result of careful planning, a strong workforce that is prepared to deliver value for money and a 'can do' attitude.
The Maltese Civil Court recently held that underwriters need not make payments under an insurance policy when the loss or damages occurred due to a fault or negligence on the part of the assured and where the assured's behaviour constitutes a breach of policy. This judgment highlights the importance of ensuring that owners are familiar with the content of their insurance policies – in particular, with the responsibilities arising thereunder.
In a recent court-approved private sale, the Maltese Civil Court unprecedentedly permitted a mortgagee to purchase a vessel animo compensandi, meaning that rather than paying the purchase price from its own pocket, the amount was offset against the existing debt owed to the mortgagee. This judgment is significant, as it offers mortgagees more flexible enforcement options.
While the arrest of vessels is an exceptionally effective and powerful tool which genuine creditors have every right to use, it is paramount that the rule of law is observed and the law's high standards are maintained. Otherwise, there is a risk of increased lawlessness. The Maltese courts have addressed arresting parties' failure to follow the law in several cases, taking immediate action to correct any misinformation.
A Maltese civil court recently considered whether the penalty proceedings under Article 865 of the Code of Organisation and Civil Procedure can be brought against a vessel in rem. The court found that such proceedings can be commenced only against the person or persons that removed the vessel from Maltese waters in violation of the court order, not against a vessel in rem.
Over the last few years, the government has sought to promote the development of the aviation sector through the introduction of legal and administrative infrastructure modelled on the common law system and international conventions, including the adoption of the Cape Town Convention, the creation of a dynamic aircraft and mortgage register and the introduction of comprehensive laws on trust.
A recent case has highlighted a weakness in Maltese law in relation to the right to claim damages resulting from an illegal arrest. Despite finding that the arrest was illegal, the court stopped short of ordering reparations because it held that the defendants' failure to satisfy the criteria outlined in Article 742(D) Code of Organisation and Civil Procedure was not malicious, frivolous or vexatious and thus no damages could be sought.