Ship Registration Process Under Maltese Law Explained
Explore the registration of ships under Maltese law, including the types of assets that can be registered, the significance of ship nationality, who can register a ship, eligible vessel definitions, and the reasons and process for ship registration. Discover how ship registration impacts ownership, movement, and operations of vessels under Maltese flag.
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REGISTRATION OF SHIPS UNDER MALTESE LAW Christian Farrugia LL.M(Lond) LL.D Lecturer Faculty of Laws UNIVERSITY OF MALTA
The Registration of Assets Assets form part of the patrimonial estate of a person and, in certain cases, can be registered in Registers which are established by law for regulatory, fiscal and legal purposes. Transfer of ships as movable asset as a separate transaction to registration. Different types of assets can be registered as separate classes of assets - Vehicles - IP - Immovable Property - Aircraft* - Ships* * In the case of aircraft and ships, registration also establishes nationality
A registered (ex. Malta flagged) ship takes the nationality of the State which bestows nationality upon it. State regulation of the ship is an important consequence of this act of state. Nationality of a Ship Territorial extension of a ship which moves from country to country. The law of the flag state regulates its movement and operations, subject to control of the laws of other States which the ship may visit.
WHO can register a ship - Maltese/International Ownership Art 234 of the Merchant Shipping Act regulates the registration of ships under Malta flag. Genuine link for ownership of ship and registration under the flag. Personal Ownership citizens of Malta, EU, EEA or Switzerland. Bodies Corporate/Trusts/Foundations (Shipping Organisations) established under Maltese law Foreign legal persons (International Ownership)
WHAT can be registered? Vessel definition under the Merchant Shipping Act: Ship means every description of vessel used in navigation, whether self-propelled or not, and it includes barges, pontoons, floating establishments, installations or structures, oil rigs and other similar vessels and for those parts of the Act wherever applicable it shall also include a ship under construction. Vessels over 25 years not eligible to be registered under Malta flag. Passenger Vessels, General Cargo Ships, Tankers, Pleasure and Commercial Yachts - make up the bulk of Malta s ship tonnage.
WHEN is a ship registered? As part of a ship purchase process. For newly built ships. Registration of hull also possible. Choice of flag nationality for tonnage tax relief, advantageous port charges, reputation of flag. Upon request of a lending financier for mortgage security purposes.
Registration of Ships Three types of registration i. ii. Bareboat charter registration (dual registration) iii. Section 19A MSA registration Underlying ownership
Registration of a Ship- Underlying Ownership PROVISIONAL REGISTRATION a) b) c) d) e) f) g) h) i) Application to register a ship by owner or authorised representative. Application for change of name, if applicable. Declaration of Ownership - statement confirming ownership of ship as a requirement for registration. Memorandum & Articles of Association or deed of trust/foundation. Technical documents (International Tonnage Certificate, ISM (Technical manager) declaration, CSR. Classification Society (Class) confirmations. Safe Manning Certificate Application. Radio Licence Application Payment of fees and tonnage tax. Provisional registration is valid for six months extendable for up to one year in aggregate.
Registration of a Ship Underlying Ownership PERMANENT REGISTRATION a. b. c. d. e. f. Bill of Sale or Builder s Certificate Deletion Certificate from last country of registry. Certificate of Survey (certifying seaworthiness of the vessel) and copy of International Tonnage Certificate. Carving & Marking Note. Crew List Surrender of original Provisional Certificate of Registration Bill of Sale/Builder s Certificate and Deletion Certificate in original to be delivered to the Registrar within one month from PR extendable for two month period. Certificate of Survey in original and ITC in copy as well as Carving & Marking Note to be delivered to Registrar within six months, extendable by further periods up to another six months.
Bill of Sale Form Sample quote text
Registration of Ship Bareboat Charter: In & Out Maltese law provides both for bareboat charter registration of foreign ships under the Malta Flag and also for the bareboat out registration of Maltese owners ships to other compatible registries: Documents required by Transport Malta for Bareboat In Registration A. The documentations are similar to a normal registration, except that: Ship is bareboat chartered to a body corporate, entity or such other person qualified to own a Maltese ship; Ship is not a Maltese ship, and is registered in a compatible registry; Ship is not registered in another bareboat registry; Following documents need to be produced: application for registration by the charterer or an authorised representative; declaration of bareboat charter accompanied by the charter agreement; transcript or an extract of the underlying registration; copy of the ship's International Tonnage Certificate; consent in writing of the underlying registry, owners and mortgages. Documents required by Transport Malta for Bareboat Out Registration B. Request for bareboat charter registration; Copy of bareboat charter agreement; Consent of mortgagees (if any); Undertaking by owners to surrender certificate of registry; Undertaking by charterer not to hoist the Malta flag. TM Fees: Registration fees and annual tonnage tax for bareboat charter registration are the same as those applicable for normal registration.
Registration of Ships Art 19A Charterer can obtain certificate of Malta registry in the charterer s name and as the operator of the time or voyage charter. Main rationale tonnage tax advantage and navigational considerations. Requirements: o Consent of owner of vessel. o Payment of annual fees and tonnage tax.
Registration of Ships - International Ownership Same procedure for registration of a ship as per standard process; BUT Foreign entity M&A or similar constitutive document. Legal Opinion certifying valid existence of foreign entity and ability to acquire and register a vessel and appoint resident agents in Malta genuine link. Appointment of resident agents and acceptance.
Registration Requirements Vessels between 10 to 15 years old surveyed one month after provisional registration. Vessels between 15 and 25 years surveyed prior to provisional registration. Over 25 years not eligible but exceptions can be made upon representations with Registrar for Shipping.
Mortgage Registration A mortgage is a security interest registered over a ship to secure the rights of a person (the mortgagee) over the asset of another (the mortgagor) for the latter s obligations in favour of the former Typical Mortgage Security Relationship: Bank lends money to ship owner to purchase or refit vessel Bank enters into loan agreement as well as Deeds of Covenants (and other security instruments), which will require the borrower (mortgagor) to register a first ranking mortgage over the vessel in favour of the lending bank (mortgagee). Mortgage security is enforceable against the vessel in the event of default by the borrower mortgagor.. A Mortgage grants a preferential high ranking security interest over the mortgaged vessel. Art 38 et seq of the MSA.
Art 38 of the MSA reads: 1) A registered ship or a share therein may be made a security for any debt or other obligation by means of an instrument creating the security (in this Act called a "mortgage") executed by the mortgagor in favour of the mortgagee in the presence of, and attested by, a witness or witnesses. 2) A mortgage is indivisible notwithstanding the divisibility of the underlying debt or other obligation which it may secure. 3) A mortgage shall attach to any proceeds from any indemnity arising from collisions and other mishaps as well as any insurance proceeds.
Mortgage Registration Procedure Duly executed mortgage form (original) registered with the Registrar of Shipping; Evidence of authority of mortgagor to sign and execute and register the mortgage with the registry of shipping (corporate authorities); Mortgage will typically make reference to financing/loan agreement and deed of covenants as part of transactional deeds governing the mortgage-secured obligations; Deed of Covenants ancillary to the financing agreement and regulating mortgage security; A registered Mortgage includes a date & time Mortgage can be amended and deleted;
Art 39 of the MSA (1) On the production of a mortgage for registration the registrar shall record it in the register. (2) Mortgages shall be recorded by the registrar in the order in time in which they are produced to him for that purpose, and the registrar shall by memorandum under his hand notify on each mortgage that it has been recorded by him, stating the day and hour f that record. (3) Where it is stated in the mortgage instrument that it is prohibited to create further mortgages over a vessel without th e prior written consent of the mortgagee, the registrar shall make a note in the register to such effect, and the registrar shall no record such further mortgage unless the consent in writing of the hold er of a prior mortgage is produced to him, and any mortgage registered in violation of this provision shall be null and void: Provided that where such further mortgage is executed in favour of an existing mortgagee, no such consent shall be required rom such mortgagee. (4) When it is stated in the mortgage instrument that it is prohibited to effect the transfer of the ship which is being mortgaged, or of a share therein, without the previous written consent of the mortgagee, the registrar shall make a note in the register to such effect, and the registrar, notwithstanding any other provision of this Act, shall not record any transfer of such ship or of a share therein unless the consent in writing of such mortgagee is produced to him, saving where the transfer is made pursuant to a court order in a sale by auction of such a ship or pursuant to any other court order, and any transfer registered in violation of his provision shall be null and void.
Deletion of Registration A registration of a ship under Malta flag can be deleted: upon written request of owner/charterer to the Registrar of Shipping. Original certificate of Registration and last renewal must be returned. by the Registrar in the event of non-payment of annual or other fees/tonnage tax or for reasons which justify deletion (ex. vessel becoming unseaworthy or not complying with Maltese regulations and requirements. upon sale by auction in favour of purchaser opting to register ship under another flag. deletion certificate is issued by Registrar.
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