Maritime
Recent legal updates have been introduced to both the Maritime Shipping Act and the Maritime Labour Convention, aimed at modernizing regulations, enhancing administrative efficiency, and strengthening seafarer protections within Malta's maritime sector.
The amendments to the Merchant Shipping Act focus on modernizing ship registration, financial transactions, legal procedures, and crew welfare.
A major amendment changes the definition of a bareboat charterer, now explicitly recognized as a lessee who assumes full control of a vessel, including appointing the crew. However, the charterer is prohibited from selling or mortgaging the ship.
Another significant change relates to communication with shipowners. Notices can now be sent via email rather than registered mail, a modernization that streamlines communication and enhances administrative efficiency.
New compliance requirements mandate that a ship's IMO number must be displayed in accordance with international conventions. Additionally, ships under construction must now have a keel identification number.
The age limit for ship registration has been reduced from 25 years to 20 years, meaning vessels older than 20 years cannot be registered in Malta for the first time. However, this restriction does not apply to ships that were already under the Maltese flag before reaching the age limit.
Regarding fees, both the initial registration fee and the annual fee must now be paid upfront before a certificate of registry is issued, ensuring compliance before a ship can be officially recognized.
The amendments introduce greater legal clarity and efficiency in recognizing ship mortgages and finance charters. Finance charter instruments are now officially acknowledged as valid and enforceable security interests.
Notably, foreign-registered ship mortgages can now be recognized and registered in Malta without the need to remove them from their original registry. Additionally, mortgages can now be registered on ships still under construction, providing greater security for financial institutions and investors.
A crucial change also ensures that when a ship is sold by court order, all previous mortgages or finance instruments are automatically discharged, simplifying the transaction process for buyers.
Mortgage rights have been strengthened, allowing a mortgage to secure multiple obligations, including future debts, as long as a maximum amount is specified in the agreement. Moreover, courts now have greater power to intervene in mortgage disputes at the request of a mortgagee.
To enhance administrative efficiency, several functions have been transferred from the Minister to the Registrar-General, expediting ship registration, mortgage-related matters, and legal compliance processes.
The amendments also focus on labour rights and seafarer welfare. In the event where a ship undergoes a judicial sale, crew wages will continue to accrue until the sale is finalized or the crew voluntarily terminates their employment contracts. Additionally, responsibilities for crew accommodation, repatriation of deceased seafarers, and burial expenses have been extended to include the bareboat charterer, holding them accountable alongside the shipowner.
Alongside the changes to the Maritime Shipping Act, a Legal Notice has been issued amending the Maritime Labour Convention rules under Maltese law. This update strengthens protections for seafarers by improving welfare, health, and safety standards while aligning Maltese law with new international requirements.
A major change ensures that seafarers' wages are now guaranteed, regardless of whether the ship earns freight revenue. This prevents shipowners from withholding salaries due to financial losses.
Additionally, a mandatory protection system has been introduced. Shipowners and recruitment agencies must have insurance or an equivalent financial security mechanism to compensate seafarers if the shipowner fails to meet contractual obligations. Seafarers must also be informed in advance of their rights under this system.
The amendments also emphasize the importance of living conditions and social connectivity for seafarers. The new legal notice introduces regulations on catering, food hygiene, onboard recreation, and communication access:
- Ships must have a well-equipped catering department that provides nutritious meals under hygienic conditions.
- The Fourth Schedule of the Maritime Labour Convention now requires recreational facilities tailored to seafarers' needs, particularly for those on long voyages.
- Ships must provide ship-to-shore telephone access at reasonable rates and, where feasible, internet access at similarly reasonable rates.
The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.
