Malta Shipping Company
Advantages of Registering a Ship under a Maltese Flag
- The procedure for the registration of ships in Malta is well-defined and straightforward.
- Owners, charterers and financiers of Maltese ships may benefit from highly favourable tax rates on profits derived from the ownership, sale, operation and charter of Maltese ships.
- There is complete exemption in Malta from stamp duties payable on the sale or transfer of a ship and the allotment of any share or stock of a company owning such a ship, exchange control, capital gains tax or VAT.
- There are no restrictions on the sale or transfer of shares of a company owning Maltese ships.
- There are no restrictions on the sale and mortgaging of Maltese ships
- There are no restrictions on the nationality of the Master, officers and crew of vessels registered under the Malta flag.
- Maltese ships benefit from preferential treatment in certain ports.
- It is possible to register vessels which are still under construction as well as other marine structures which do not fall within the strict definition of ships such as oilrigs, floating docks, pontoons and barges
Taxation of Shipping Companies under MSA
Shipping companies are subject to corporate tax at the normal domestic rate. However, if a ship is owned by a shipping company that is registered in Malta, or by an organisation recognised by the Maltese Authority, then it is entitled to certain benefits.
- The vessel that such, referred to as a ‘tonnage tax’ ship has all of its income exempt from income Tax. However, the shipping company will be have to pay an annual tonnage tax as well as a registration fee, details of which can be obtained from us ([email protected]) . Registered vessels must be in excess of 1,000 net tons to fully benefit from these tax advantages, however the Maltese Authorities give concessions on a case by case basis.
- No further tax shall be charged or payable on any gain arising on liquidation, redemption, cancellation, or any other disposal of shares, securities or any other interest, including goodwill, held in any licensed shipping organization.
- Also no tax shall be payable by any person on interest or other income payable to him in relation to any financing of the operations provided for under the MSA with regards to the objectives a shipping corporation may pursue, or to the financing of any ship of not less than 100 net tonnage. Maltese Shipping Company dividends distributed to the corporate shareholders are also exempt from tax if such dividends are distributed out of gains or profits derived from the ownership or operation of a tonnage tax ship.
- Any non-resident officers or employees of licensed shipping organisations, and the organisation in their respect, shall be entitled to be exempt from the provisions of the Social Security Act.
There shall also be no duty chargeable in accordance to the Duty on Documents and Transfers Act in respect of:
- The registration of a tonnage tax ship .
- The issue or allotment of any security or interest of a licensed shipping organisation
- The registration of any mortgage or other charge over or in relation to any ship or licensed shipping organization, any transfer or discharge thereof, and receipt relative thereof and any assignments granted in connection therewith; or
- The assignment of any rights and interests.
Registering a Ship in Malta
All types of vessels, from pleasure yachts to oil rigs, may be registered in the name of legally constituted corporate bodies or entities, irrespective of nationality, or by European Union citizens; a Maltese ship may also be bareboat charter registered under another flag.
There are neither trading restrictions nor age restrictions. However:
- Ships of 15 years and over, but under 20 years, must pass an inspection by an authorised flag state inspector before or within a month of provisional registration; and
- Ships of 20 years and over but less than 25 years, must pass an inspection by an authorised flag state inspector prior to being provisionally registered. As a rule trading ships of 25 years and over are not registered.
The procedure for the registration of a vessel is relatively straightforward. Provisional registration, which in terms of the law has the same effect as the so-called permanent registration, can be effected very quickly. Authority to help a ship, however, will only be given once the Administration is satisfied that the vessel conforms to all the standards required by the relative international conventions.
Provisional registration has a validity of six months, although this can be extended by a further six months; by this time all the documentation has to be completed for permanent registration. This includes, in particular, evidence of ownership and of cancellation of former registry. Authority to operate still remains linked to conformity with the relative manning, safety and pollution prevention international standards.
Requirements for registering a ship or a yacht in Malta
- An application for registration by the owner or an authorised representative accompanied; if required, by an application for a change of name;
- A copy of the ship’s International Tonnage Certificate, where applicable;
- Proof of qualification to own a Maltese ship; in the case of a body corporate, the memorandum and articles of association.
- A declaration of ownership made before the Registrar by the owner or an authorised representative;
- Evidence of seaworthiness; in the case of trading vessels, confirmation of class;
- Payment of initial and annual registration fees.
Documents to be submitted during provisional registration:
- A builder’s certificate, if the vessel has not been registered elsewhere; Otherwise a bill of sale or any other document for registry.
- A cancellation of registry certificate from the last country of registry, showing vessel to be free from encumbrances or otherwise;
- A Certificate of Survey and a copy of the international Tonnage Certificate certifying that the vessel has been surveyed in accordance with Maltese regulations;
- Evidence that the vessel has been marked in accordance with the law;
- At least one crew list.
Malta has acceded to IMO Convention STCW 1978. Maltese ships are subject to the provisions of the Merchant Shipping Act and ancillary regulations concerning the competency of officers and seamen.
There are no restrictions imposed on the nationality of the master, officers and crew engaged on Maltese Ships. However, to promote the employment of the Maltese seafarers there is a small reduction in fees for each Maltese seafarer employed.
A Valid Minimum Safe Manning Certificate must be carried by all Maltese merchant ships of 500 gross tonnage and over. On the entry of a ship in the Malta register, the Merchant Shipping Directorate will issue a Minimum Safe Manning Certificate valid for five years from the date of provisional registration. Thereafter, prior to the expiry of the certificate or upon any change in the equipment, construction or trading of the ship, the Directorate will issue a new certificate again valid for five years to coincide with the date of the renewal of the certificate of registry.
The minimum safe manning guidelines shown below incorporate those contained in Imo Resolution A481 (XII). Specific requirements will be considered although a practical demonstration of the ability of the crew may be required.
Certificates of competency are issued on examination. Foreign certificates issued in terms of the 1978 STCW Convention are recognised where they have granted by examination.
A contract of employment in the form of a crew agreement must be made between the master and seamen.
- A crew agreement must contain the following details:
- Personal details of each member of the crew;
- The time at which each seafarer is to be onboard or to begin work
- The capacity in which each seafarer is to serve;
- The amount of wages for each seafarer;
- Agreed leave
- Disciplinary provisions.
- A list of persons under the age of 18 years and their birth dates
In Maltese ports, the terms of the agreement (including records of engagement and discharge of seafarers) preferably are to be endorsed by a Maltese shipping officer and, in foreign ports, by a Maltese Consular Officer. An agreement can be made for a single voyage or, if the voyage is less than one year, it may be extended over two or more voyages.
The content on this website is for information purposes only and should not be taken as tax, legal or any other professional advice.
Contact us for more information as well as for a quote. We will happily guide you through the ship registration, and company formation process and also advise you on the solutions that would best suite your needs!
[email protected] Or call +356 2010 3020