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Registering a Ship Under the Maltese Flag

It is no coincidence that Europe’s largest ship register happens to be that of the Maltese Islands. Apart from having a very important geographical location in the Mediterranean, Malta’s very strong legal and regulatory platform permits ship owners to benefit from the Maltese flag which holds a strong and long tradition in Maritime law.

Ship owners who are considering whether to register a vessel under the Maltese flag should be knowledgeable of the following facts. Firstly, all types of vessels, from super yachts to tankers, including ships under construction are eligible to be registered in Malta. This includes vessels which do not fall within the strict definition of ‘ships’ such as oil rigs, pontoons and floating docks.

The Maltese flag presents ship owners several other attractions including the ‘Tonnage Tax Scheme’ which was recently revised and aims at strengthening the current Maltese tonnage tax principles whilst also promoting the registration of ships in Malta. The scheme provides that any income, profits or gains which derive from shipping activities carried out by a licensed shipping organisation may be exempt from tax under the Income Tax Act, provided that the registration fees and tonnage taxes are duly paid.

In addition to this, the Maltese legal framework removes any form of restrictions when it comes to the nationality of the master, officers, crew of a vessel or the shareholders and directors of Maltese shipping companies. Likewise, there are no trading or navigation restrictions. Ships owners should also be aware that Malta happens to be a member of the Paris Memorandum of Understanding and is placed very highly on its White List thus increasing the marketability of such vessels.

Another thing to keep in mind is that no exchange control authorisation is required for incorporating or operating a shipping company- this also applies when taking security for loans or other facilities over Maltese registered vessels owned by companies registered locally. 

Lastly, apart from the fact that there are no inspection fees and no hidden costs, having a ship registered under the Maltese flag would mean that a ship owner would have to deal with a well organised and highly responsive shipping registry, running 24 hours, 7 days a week and guaranteeing long term customer relationships.

Proceeding to Registering a Vessel Under the Maltese Flag

The procedure for registration of a vessel is rather straight forward. A vessel is first registered provisionally under the Malta flag for 6 months during which all documentation needs to be finalised.

The requirements for provisional registration include; the actual application for registration (including any possible application for the change of name), proof of qualification that you are a Maltese citizen or company (and if not must appoint a resident agent), a copy of the ships International Tonnage Certificate, a Declaration of Ownership, Evidence of Seaworthiness, a Declaration of Maritime Labour Compliance, an application for Minimum Safe Manning Certificate and an application for a Ship Radio Station License. Lastly, payment of the initial registration fees.

If the vessel was previously owned by a different person, a Bill of Sale must be submitted to prove that there was an actual transfer of that same vessel to the applicant for registry. Otherwise a builder’s certificate in the name of the applicant must be provided.

Maltese maritime legislation also covers the possibility of registering boats that are being used for chartering purposes. Maltese law provides both for the bareboat charter registration of foreign ships under the Malta flag and also for the bareboat charter registration of Maltese ships under a foreign flag. What is beneficial here is that ships that are registered under the Malta flag that are being chartered enjoy the same right and privileges and have the same obligations as any other ship registered in Malta.

Overall, this comes to show how Malta’s maritime legal regime is geared towards the onboarding of new vessels flying the Maltese flag, while maintaining a clear, strategic vision that supports business and the maritime industry at large.

For more information on Shipping & Maritime please contact Dr Robert Tufigno on rtufigno@gtgadvocates.com and Dr Sean Xerri de Caro on sxerridecaro@afilexion.com.