Asteria Advisory – News & Updates

Opinion: A Commercial Court for Malta ?

Update (2025): Since this article was first published, a Commercial Court has been established in Malta under the Code of Organisation and Civil Procedure. This opinion piece is retained for archival purposes, reflecting earlier commentary on the topic.

Earlier in 2017, the Ministry for Justice, Culture and Local Government held a public consultation, titled “Setting up of the Civil Court, First Hall, Commercial Section“.  The consultation was then concluded in July 2017.

Wide Range of Questions

Consultation questions included whether there should be a commercial section within the civil arm of the Maltese courts. The consultation also asked whether the remit should be limited to the Companies Act or wider.

Feedback Received

The feedback received applauded the initiative of introducing this section. In the past the Maltese courts included a Commercial Court section. The commercial court was eventually discontinued.

However, in the current litigation climate, both the Government and those participating in the consultation felt that the introduction of this section would increase in the efficiency of justice being delivered.  Naturally, it was considered imperative that the necessary human and other resources are provided.

During the consultation, the feedback mentioned that matters falling under the Commercial Code should also be included within the scope of this section’s jurisdiction. Others suggested that other laws such as the Trusts and Trustees Act and other codes that deal with matters of a commercial nature (e.g.  banks) should also fall under this court’s jurisdiction.

Existing Procedures and the New Court

The court’s general area of competence and procedure are still unclear.  Most procedural matters are generally regulated by the Code of Organisation and Civil Procedure. A new court would need to have its own rules of procedure, or somehow be regulated by this Code.  The Code regulates the procedure of all the civil courts in Malta.

The use of alternative dispute resolution mechanisms, including pre-trial conferences and/or arbitration or mediation were also considered an efficient means to resolve disputes.  They can provide direction in cases that are deemed to be high-risk or that are of a delicate nature.

The consultation respondents further referred to the implementation of online filing and payment of fees.  At the time of writing, only physical payment and filing of court cases is possible.   This renders the process inconvenient and unwieldy for most professionals and increases crowding in court.

Respondents additionally suggested other legislative amendments to be made alongside the setup of this new commercial court.  These amendments would ensure that the new Bill respects the current legal framework.

In late 2017, the Government published its response to the consultation. In the response, the Government stated that, subject to Parliamentary approval, it plans to enact the new legislation in early 2018. The plan is for the new Commercial Section  to commence operation in the second quarter of 2018.

FIAU Press Release on Penalties

Following the coming into force of the Various Financial Services Laws (Amendment) Act, 2017 (Act XXVIII of 2017) on the  1st December 2017, publication of administrative penalties imposed by the Financial Intelligence Analysis Unit (“FIAU”) for one or more contraventions of the Prevention of Money Laundering Act (“PMLA”) and/or of the Prevention of Money Laundering and Funding of Terrorism Regulations no longer falls under Article 13A of the PMLA but by the new Article 13C.

Article 13C now provides for the publication of administrative penalties where these exceed €10,000 and have become final and due.  Publication is to take place in accordance with policies and procedures set by the FIAU’s Board of Governors.

The then-existing Policies and Procedures were revised on the 22nd  December 2017, to take into account the changes brought about by the new Act as well as the requirements of Directive (EU) 2015/849 relative to the publication of administrative sanctions.

The revised version of the said policies and procedures is available on the FIAU’s website and can be accessed through the following link – http://www.fiumalta.org/penalties .

The FIAU advises subject persons to become familiar with these policies and procedures.

Queries on the matter are to be sent to legal@fiumalta.org.

Anti-Money Laundering – New Rules in Force

The Fourth Anti-Money Laundering Directive (AMLD 4) aims to strengthen the integrity of the EU’s financial system by combating money laundering and the financing of terrorism.  AMLD 4 relies on the principle that illicit financial flows can damage not just the Member State concerned, but the stability and reputation of the entire EU financial sector.

The evolution of financial crime

Financial crime has become more sophisticated over time, often involving international networks. This has made tighter controls and increased coordination across jurisdictions more important than ever. The EU’s approach aligns closely with international standards, including those set by the Financial Action Task Force (FATF).  

Key Objectives of AMLD 4

One of the core goals of AMLD 4 is to improve transparency by ensuring that the beneficial ownership of companies is identified and recorded. This means tracing the ownership structure to the individual who ultimately owns or controls the entity. The Directive mandates that this information must be accurate, up-to-date, and easily accessible to competent authorities  

Key Aims of Anti-Money Laundering Legislation

Identifying the beneficial owner is key to avoiding would-be criminals from hiding behind a corporate structure.  This is the raison-d’etre behind the due diligence and other obligations underlying the Directive.

The aim is to look for the individual (natural) person at the very end of the line. Information needs not only be adequate and accurate, but also up-to-date, which is why certain checks need to be repeated regularly.

Main changes in AMLD 4

  • Less Reliance on Simplified Due Diligence: Simplified Customer Due Diligence (CDD) is now only allowed in limited cases. Entities must demonstrate low risk before applying reduced checks—and must continue to monitor the relationship.

  • Enhanced Due Diligence (EDD): Required for high-risk clients, such as asset-holding vehicles, cash-intensive businesses, and transactions involving high-risk jurisdictions.

  • Wider Scope of Politically Exposed Persons (PEPs): The definition now includes individuals in domestic public positions, not just foreign ones. All PEPs are automatically subject to EDD.

  • Central Beneficial Ownership Registers: Companies must maintain beneficial ownership information in a register accessible to national authorities like the MFSA and FIAU in Malta.

  • Lower Transaction Thresholds: The threshold for triggering CDD for cash transactions has been reduced from €15,000 to €10,000. For high-risk gambling operations, the threshold is as low as €2,000.

  • Gambling Sector Inclusion: The entire gambling sector now falls under AMLD 4, not just specific areas, and subject persons must apply CDD when applicable.

  • Tax Crimes as Predicate Offences: Tax offences are now clearly predicate offences across all EU jurisdictions.  This harmonises definitions and enables Member States to better enforce the AMLD 4 rules.

  • Increased National Oversight: Member States must perform their own national risk assessments.  This could may lead to Member States introducing stricter national requirements.

Malta’s Implementation

On 20 December 2017, Malta adopted the Prevention of Money Laundering and Funding of Terrorism Regulations, 2017, in line with AMLD 4. These regulations repealed the 2008 rules and introduced risk-based CDD as the standard approach.

Although the FIAU is revising the Implementing Procedures (Part I), entities are advised that in case of conflict between this document and the regulations, the 2017 regulations will take precedence.

Final Thoughts

AMLD 4 marks a significant shift in the EU’s AML framework. By focusing on transparency, harmonisation, and a risk-based approach, AMLD 4 aims to make financial systems more resilient to abuse. Malta’s regulatory framework continues to evolve to meet these standards, reinforcing its commitment to compliance and integrity in financial services.

Ballast Water Management Convention brought into Force

Transport Malta, the competent authority in Malta to regulate shipping and ports, has issued a Merchant Shipping Notice concerning the implementation of the Ballast Water Management Convention.  Known as the Ballast Convention, the treaty was transposed through regulations issued in 2017.

The Merchant Shipping notice addresses owners, operators, masters, of ships, owners’ representatives and recognised organisations. It brings to attention the coming into force of the Convention.

The Convention came into force on the 8th September 2017.  The implementing regulations in Malta came into force on the same date.

Ballast water is carried in ballast tanks and is used to stablise or lower the ship on unloaded voyages.  The rules have been changed to make sure that ballast water is carried in these special, segregated tanks only. Further, water taken in for ballast has to be changed several times during a voyage. This will make sure marine organisms are not carried too far from their natural habitat.

As from this date, all Maltese ships engaged under international voyages to which the Convention applies, must be compliant.   The convention and regulations set standards standards for the management of ballast water and sediments. The requirements include drawing up and maintenance of a Ballast Water Management Plan (BWM Plan).

The convention grants a transition period of up to three months from the date of entry into force.  This time will allow owners to make the necessary arrangements for compliance.  Ships must also maintain Ballast Water Record Book is also to be maintained.

The Regulations may be downloaded from here.

Marine Insight’s Online Resources for Maritime Piracy

Information is available to help to keep informed on piracy on the high seas, as well as how best to deal with this problem

Marine Insight has published links to 28 sources of information, useful to professionals in different aspects of the shipping industry.

 

“With the increase in piracy at the sea, several maritime organisations and defence agencies have started providing online updates on events related to maritime piracy which is taking place around the world,” reads the introduction.  This excellent initiative is worth exploring.