Aviation

Malta has proven to be a valuable place for the aviation industry, providing beneficial incentives for those looking to register their aircraft on the island.

Malta also provides many initiatives which contribute to the growth of the aviation industry; the island has a business-friendly regulatory framework addressing the challenges the aviation industry poses. The Aircraft Registration Act, along with other legislative packages, ensures that Malta continues to develop as a leading jurisdiction for aircraft registrations.

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Aviation Services in Malta

In 2010, the Aircraft Registration Malta Act came into force; the main aim of this act is to regulate the registration of an aircraft in accordance with Maltese law. The Act also takes into consideration the registration and enforcement of aircraft mortgages and the implementation of the Cape Town Convention.

Malta is a highly competitive jurisdiction with high economic development in several areas of the aviation industry and a well-established legal infrastructure. Not to mention the freedom of movement within European Union Member States on international and internal flights has made Malta an ideal jurisdiction for private aircraft registration.

The Maltese Regulator and the Legislation

Maltese registered aircrafts are documented in a register by the Director-General whose authority falls under the Civil Aviation Directorate; this is the central authority responsible for aircraft registration.

Malta has successfully positioned itself as one of the primary aviation hubs in the EU by strengthening its aviation registry. Malta‚Äôs aviation legislation provides the aviation industry with a solid foundation along with competitive aviation registration costs, the authority’s expertise of the aviation sector, and favourable corporate structures. Malta‚Äôs aviation industry offers a variety of added benefits to those seeking to register an aircraft on the island.

The main advantages of registering aircraft in the Maltese jurisdiction are:

  • An attractive corporate tax system;
  • Robust legislative framework and an extensive network of double taxation treaties;
  • Robust legislative framework and an extensive network of double taxation treaties;
  • High standards of safety and security.
  • No withholding tax on lease payments where the lessor is not a tax resident of Malta;
  • Transparency of rights and interests in aircraft;
  • Competitive minimum depreciation periods for aircraft;
  • An extensive network of double taxation treaties; and
  • No taxable fringe benefits arising from the private use of the aircraft by non-resident individuals who are shareholders, employees or officers of companies involved in the international transport of goods or passengers.

There are a number of advantages to having a Malta-registered aircraft. Since the inception of the Malta Aircraft Registration Act in 2010, Malta has become one of the most reputable aircraft registers which have boosted the country’s aviation sector. Due to this and the strategic location of Malta, the country is becoming a top jurisdiction for aircraft leasing and registration.

The Ease of Aircraft Registration in Malta

It is standard for countries to require that aircraft are registered and for countries to keep a register to ensure airplanes and helicopters are adequately monitored and regulated. In fact, the Aircraft Registration Act requires the registration of aircraft in Malta to be recorded in the National Aircraft Register, which is to be kept by the Director General, to whom all powers relating to such registration are delegated.[1]

Flexibility during Registration

The Aircraft Registration Act provides wide flexibility to the conditions for registration. In fact, Article 3(3) allows for an aircraft to be registered before it has been constructed. It allows for an aircraft to be registered ‚Äúas soon as it is uniquely identifiable‚ÄĚ. It then holds that ‚Äúa description of an aircraft that contains its manufacturer serial number, the name of the manufacturer and its model designation shall be sufficient to render an aircraft uniquely identifiable‚ÄĚ.

Recognition of Fractional Ownership Interests of Aircraft

Article 3(4) also allows for the co-ownership of an aircraft, as it allows the interest in an aircraft to ‚Äúbe divided into shares or other interests‚ÄĚ.

Flexibility as to whom may Register an Aircraft

Article 4(3) also provides that the person registering the aircraft need not have the ownership or lessor rights in an aircraft or its engines. In fact, Article 6 then goes on to provide a list of persons granted the capacity to register an aircraft, being:

(a) the Government of Malta.

(b) a Maltese citizen, an EU citizen.

(c) A citizen of any state within the European Economic Area (EEA) or Switzerland, having a place of residence of business in Malta, the EU, the EEA, or Switzerland; including any person sharing in the ownership of such aircraft by virtue of the community of acquests with a citizen as described above.

(d) an undertaking formed and existing in accordance with the laws of Malta, an EU Member State, an EEA State or Switzerland, having its registered office, central administration and principal place of business within Malta, the EU, the EEA or Switzerland; and if conducting air services, not less than 50% must be owned, directly or indirectly, by any of the persons referred to in (a), (b) and (c) above or by any Member State of the European Union.

(e) a natural person or undertaking established in an approved jurisdiction, other than those mentioned above, if such aircraft is not used to provide air services, if certain criteria set out in the provision are met.

Article 5 then holds that such capable persons may register the aircraft if they are (a) the owner of the aircraft; (b) the owner of an aircraft under construction or temporarily not being operated or managed; (c) the operator of an aircraft under a temporary title, such as a lease; (d) the buyer of an aircraft under a conditional sale or title reservation or similar agreement and who is authorised to operate the aircraft.

Ease of De-Registration

It is also as easy to de-register an aircraft. In fact, Article 13(1)(f) of the Aircraft Registration Act provides that an aircraft shall not continue to be registered in Malta if the registrant has made a written request to the Director General for cancellation or registration and closure of register.

Requirement of Resident Agent for International Registrants

The Aircraft Registration Act defines an ‚ÄėInternational Registrant‚Äô as a foreign national or undertaking, not being a person mentioned in Article 6(1)(b) or (c). Article 19 then goes on to provide that an international registrant shall be deemed to satisfy the qualifying requirements of Article 6(d) unless the Director General has made a declaration to the contrary.

Article 20 requires an international registrant to appoint a Resident Agent in writing prior to registration, a person that is habitually resident in Malta and that has satisfied the Director General that he is a person capable of carrying out the functions stated under this Act. Article 20(2) then provides a similar presumption to Article 6(d), holding that a resident agent shall be deemed to satisfy the Director General unless the Director General has made a declaration to the contrary.

Article 22 then provides the functions of the resident agent, which include acting as a channel of communication between the International Registrant and the Director General, signing and filing all declaration and forms required in terms of Maltese law and acting as a judicial representative of the International Registrant.

Cheap Registration Fees

The Fifth Schedule to the Aircraft Registration Act provides the fees charged for the issuance of a Certificate of Registration in respect of an aircraft, which vary between a minimum of ‚ā¨60 and a maximum of ‚ā¨750, depending on the weight of the aircraft.

Ease of Licensing the Aircraft for Commercial Purposes

Article 2 of the Civil Aviation (Air Operators‚Äô Certificates) Act defines an ‚Äėair transport undertaking‚Äô as an undertaking whose business includes the carriage by air of passengers or cargo for hire or reward.

[1] Aircraft Registration Act, Article 3 and Article 5

AOC Services in Malta

Requirement of Air Operator’s Certificate for Public Transport Flights.

Article 3 of the Civil Aviation (Air Operators’ Certificates) Act holds that an aircraft registered in Malta shall not fly on any flight for the purpose of public transport, otherwise than under and in accordance with the terms of a certificate granted to the operator of the aircraft, certifying that the holder of the certificate is competent to secure that aircraft operated by him on such flights as that in question are operated safely.

Definition of Public Transport Flights

Article 3(2) then holds that an aircraft shall be deemed to fly for the purpose of public transport (i) if hire or reward is given or promised for the carriage of passengers or cargo in the aircraft on that flight, or (ii) which provides a more complex and less applicable situation.

Granting of Air Operator’s Certificate

Article 4 provides that the Director shall grant an air operator’s certificate to any person applying if he is satisfied that the person is competent, having regard in particular to his previous conduct and experience, his equipment, organization, staffing, maintenance, and other arrangements, to secure the safe operation of aircraft of the types specified in the certificate on flights of the description and for the purpose so satisfied.

The Air Operator’s Certificate will then remain in force for a period of one year.

Exception to Requirement for Air Operator’s Certificate

Article 11A exempts foreign air transport undertakings which operate a Maltese-registered aircraft through a dry lease agreement from the requirement of obtaining an Air Operator’s Certificate, provided the Director is satisfied that the foreign air transport undertaking is competent to ensure the safe operation of the aircraft.

Air Operator’s License

Requirement of Air Operator’s Licence

Article 6 of the Civil Aviation Act (CAA)[1] holds that ‚Äúno aircraft shall be used on any flight for reward or in connection with any trade or business except under and in accordance with the terms of a licence granted to the operator of the aircraft under article 7, being a licence currently in force and authorizing the operator to operate aircraft on such flights as that in question.‚ÄĚ This applies to any flight in any part of the world by an aircraft registered in Malta and any flight beginning or ending in Malta, by an aircraft registered in such other country or territory if any, as may be prescribed.

[1] Chapter 232 of the Laws of Malta

Authority to Grant Air Operators Licence

Article 7 of the CAA holds provides that the Authority shall grant an operator licence upon being satisfied that the air transport undertaking meets the requirements of the Civil Aviation Act. Article 7(3) then provides that the application to the Authority for the grant of an operator licence shall contain all particulars required and must be accompanied by such fees as prescribed.

Requirements Prior to Receiving Air Operators Licence

Article 7(4) provides that an operator licence shall not be granted until it has been shown to the satisfaction of the Authority that, (a) the principal place of business and registered offices of the air transport undertaking are in Malta, (b) its main occupation is air transport in isolation or combined with any other commercial operation of aircraft or repair and maintenance of aircraft, and (c) it is owned and continues to be owned directly or through majority ownership by Member States of nationals of Member States, who shall at all times have effective control of the air transport undertaking.

Requirement of Air Operator’s Certificate

Article 7(5) then provides that the Authority shall only grant an operator licence to an applicant if such applicant is in possession of a valid Air Operator’s Certificate specifying the activities to be covered in the operator licence.

No Need for Renewal of Air Operator’s Licence

Article 7(6) holds that the Air Operator’s licence shall remain valid for as long as the air transport undertaking continues to meet the requirements for the issue thereof.