Welcome to our information site about aircraft registration in Malta. The aim of this site is to help you decide whether or not Malta might be the right jurisdiction for your needs.
Obviously, we hope to show you that Malta is an excellent jurisdiction in which to register one or more aircraft. However, we realise that it may not be exactly right for you. If that is the case, we understand and hope that the information below is helpful to your decision making process.
However, if after reading this page you believe that Malta might be the location for you, please use the form on this page to contact us and we will investigate your needs fully to ensure that you make the best choice possible.
As you will see from the layout of this site, we have multiple languages available to us. This means that should you wish to proceed with aircraft registration, we can arrange for translators and interpreters to assist during the process.
As you may know, Malta is an EU member state, a chain of three inhabited islands (Malta, Gozo and Comino) in the central Mediterranean Sea, to the south of Sicily. Malta1 is a densely populated nation with few natural resources. Over the centuries, this has forced the Maltese to be a trading nation – the strategic location of the islands has made the country a key site for a number of other countries.
Being a member of the European Union2 provides a number of key factors that many other competing jurisdictions may lack. For example, the legal system in Malta is based mainly around the UK system, with some small Italian influences. However, ultimately the system is that of a European member state and is conducted in English.
The Maltese population is largely tri-lingual. Virtually every child is taught Maltese and English to a very good standard, but Italian is also taught, meaning that a majority of working adults – and certainly almost everyone in the business and legal worlds – speaks a minimum of three languages.
The capital city is Valletta – an historic city of incredible beauty. Valletta has a very small population when compared to other capital cities, in part because it is a UNESCO World Heritage Site3 which limits building and (re)development.
Tourism plays a vital part in the local economy. When it comes to natural resources, the country really does have sunshine in abundance! There are a number of areas in which tourism is more concentrated, such as St Julians, Sliema, Qawra and Bugibba in the north and Marsalforn in Gozo.
Much of the local economy happens more inland in towns such as Naxxar, Mosta and Birkirkara.
Business And Finance
Fiscally Malta is an onshore jurisdiction, as all EU member states are. However, there are a range of rules in place that make the country attractive to certain types of businesses and individuals.
A great example of this is the nation’s shipping registry. It is the largest shipping registry in Europe and is believed to be the eighth largest in the world. It is this success that the aircraft registry was initially launched to emulate. While aircraft registration Malta is nowhere near as important to the economy at this point as the shipping registry is, it has grown strongly since it’s launch.
Malta is a politically stable, highly-regulated EU jurisdiction, in a convenient location in Europe, close to Africa and the Middle East. Operational costs are generally between half and two-thirds of those elsewhere in Europe and the industrial relations record is strong. All legislation is written in both English and Maltese.
Malta’s National Aircraft Register4 is all-inclusive in that it integrates the aircraft and mortgage registers. Therefore details as to ownership, technical information and third party rights over the aircraft and its engines are available in the same place, which enhances the visibility of rights.
Safety and security standards are of the highest level: Malta is an EASA certified state5 and has an FAA Category 1 rating.
We are proud to provide a wide range of services that can either assist or completely take care of your aviation registration needs. We have wide ranging experience in both the local and international markets, having worked with small and large companies, wealthy individuals, manufacturers and airlines. Our services can be used to register business jets, commercial aircraft, helicopters and even airlines.
Malta Aircraft Registration Eligibility Rules
An aircraft may be registered in Malta6 by any of the following persons:
– An owner who also operates the said aircraft;
– An owner of an aircraft under construction or temporarily not being operated or managed;
– An operator of an aircraft under a temporary title; or
– A buyer of an aircraft under a conditional sale or title reservation agreement or similar agreement, and who is thereby authorised to operate the vessel.
For Private Aircraft the following are able to register an aircraft:
The following countries fall within the definition of “approved jurisdictions” as prescribed by the Aircraft Registration Act -;Albania, Algeria, Aruba, Bahamas, Bahrain, Barbados, Bosnia and Herzegovina, Brazil, Bermuda, British Virgin Islands, Cayman Islands, China, Croatia, Egypt, Georgia, Gibraltar, Guernsey, Honduras, India, Indonesia, Iraq, Isle of Man, Kosovo, Jersey, Jordan, Kazakhstan, Kuwait, Lebanon, The Former Yugoslav Republic of Macedonia, Malaysia, Marshall Islands, Monaco, Montenegro, Morocco, Oman, Panama, Philippines, Qatar, Russia, Saint Lucia, San Marino, St. Kitts and Nevis, St Vincent and the Grenadines, Saudi Arabia, Serbia, Singapore, South Africa, Syria, Tunisia, Ukraine and the United Arab Emirates.
A natural person who is a citizen of, or an undertaking established in, a member country of the Organisation for Economic Co-operation and Development and any other country approved by the Minister by notice for the purposes of the Act (termed “International Registrant” in the Act), provided it:
– has legal capacity to own/operate an aircraft in terms of law;
– appoints a local resident agent to represent the owner in Malta for matters concerning the registration of the aircraft;
– complies with applicable regulations/guidelines.
For Any Aircraft (either private or commercial use) the following are qualified to register an aircraft:
– The Government of Malta
– A Maltese citizen or a citizen of a Member State of the E.U. or of an EEA State7, or Switzerland, having a Maltese place of residence or business, the E.U., the EEA, or Switzerland, including a person sharing in the ownership of such aircraft by virtue of the community of acquests subsisting between such person and a citizen as described above in whose name the aircraft is registered;
– An undertaking formed and existing in accordance with the laws of Malta, of a Member State of the E.U., of an EEA State, or of Switzerland and having its registered office, central administration and principal place of business within Malta, or the E.U., or the EEA, or Switzerland, whereof not less than 50% of the undertaking is owned and effectively controlled by the Government of Malta, or by any Member State of the E.U. or by persons referred to above, whether directly or indirectly through one or more intermediate undertakings.
Malta is obviously reliant on the importation of goods from the EU and beyond. This places a special emphasis on the importance of the Malta International Airport8 in Luqa.
MIA has a number of important businesses that operate permanently. Perhaps the most important in Lufthansa Technik9 which is the European base for repairs and maintenance for their fleet. It is an important employer for the economy with over 800 members of staff.
The Cape Town Treaty10, otherwise known as the Cape Town Convention on International Interests in Mobile Equipment, is an international treaty with the aim of standardising rules governing movable property and assets. It has created standards for security interests, leases and the registration of contracts of sale, amongst other things. It also has legal guidelines for default in financing terms and bankruptcies.
The elements of the treaty that apply to us, aircraft and their engines, was signed in 2001.
The EU joined the treaty in April 2009 and Malta was one of the first countries to ratify the rules11 on 1st October 2010. As a member, the treaty enables debtors registering their aircraft in Malta to be entitled to a reduction on their borrowing costs, which is known as the “Cape Town discount”.
Fiscal Benefits Of Maltese Aircraft Registration
– There is no import duty on the importation of civil aircraft into Malta.
– Aircraft do not attract any stamp duty.
– Income derived from the ownership, lease or operation of an aircraft or aircraft engine engaged in the international transport of passengers or goods is deemed to arise outside Malta, so is exempt from Maltese tax.
– This foreign source rule applies regardless of the country of registration of the aircraft, or whether the aircraft has called at, or is operated from a Maltese airport.
– VAT – The VAT implications vary according to the manner in which the aircraft is used, that is, whether the aircraft is employed by an airline operator for reward chiefly for international transport of goods or passengers, or whether it is purely for private use. VAT implications similar to those applicable in other EU Member States would be applicable in respect of importations, intra-community acquisitions, or supply of aircraft.
– The private use of an aircraft by a non-resident individual who is an employee or officer of a company whose business includes the ownership, leasing or operation of aircraft engaged in the international transport of goods or passengers is deemed NOT to constitute a taxable fringe benefit.
– Any person that carries on a trade or business consisting of the repair, overhaul or maintenance of aircraft, engines or equipment incorporated or used in such aircraft, may benefit from investment tax credits against the tax due on its chargeable income in Malta.
– Malta has over 60 Double Taxation Treaties in force. In addition, there are a number of other agreements that have been negotiated and are in the process of coming into force and yet more that are in the process of being negotiated.
– Where there is no double tax treaty in place, Maltese legislation has rules in place to allow unilateral relief on income arising outside Malta.
– Low minimum capital requirements.
– Companies can pay tax in any currency and receive tax rebates in any currency, thereby eliminating exchange risk.
– Competitive accelerated depreciation periods – As from the year of assessment 2010, the minimum period to claim wear and tear deductions for depreciation of aircrafts, engines and interiors has been shortened as indicated below:
Aircraft airframe, engine and overhaul: 6 years
Aircraft interiors and other parts: 4 years
However, the fiscal benefits of aircraft registration Malta do not only relate to companies and aircraft. There are rules in place that benefits highly skilled employees that are based in Malta. These are known as the Highly Qualified Persons Rules.
Enacted by virtue of Legal Notice 106 of 201112 provide for the application of a beneficial flat 15% tax rate to the remuneration paid to employees in respect of certain qualifying postions. Legal Notice 306 of 201213 has expanded the rules to apply to the income from specified employments with companies holding an Air Operators’ Certificate issued under the terms of Article 4 of the Civil Aviation (Air Operators’ Certificates) Act. These rules only apply to individuals that are resident but not domiciled in Malta.
The flat rate of 15% tax applies provided that the income amounts to at least €75,000 adjusted annually in line with the RPI. The 15% flat rate is imposed up to a maximum income of €5,000,000 – the excess is exempt from tax.
Employed positions that were included in the 2011 rules were:
Chief Executive Officer
Chief Financial Officer
Chief Operations Officer
Chief Commercial Officer
The amendments of 2012 expanded the list to also include the following roles:
Aviation Accountable Manager
Aviation Continuing Airworthiness Inspector
Aviation Flight Operations Inspector
Aviation Ground Operations Manager
Aviation Training Manager
The individual income derived from employment in an “eligible office” will not qualify for the 15% reduced rate if:
– it is paid by an employer who receives any benefits under business incentive laws or,
– is paid by a person who is related to the employer who received any benefits under any business incentive laws or,
– if the individual holds more than 25% (directly or indirectly) of the company licensed and/or recognised by a company holding an Air Operators’ Certificate or,
– if the individual is already in employment in Malta before the coming into force of the scheme with a company not holding an Air Operators’ Certificate or,
– not holding “eligible office” with a company not holding an Air Operators’ Certificate
Air Operator’s Certificate (AOC)
Maltese AOC’s are issued on the basis of Annex III to the Regulation (EC) 3922/1991, as amended: EU-OPS for aeroplanes and JAR-OPS 3 for helicopters. If all the supporting documents are in order the certificate should be issued within three months of making an application.
AOC14 applicants must adhere to the CAD rules, as set out in the Operations Advisory Notice No. 02/10 “Guidance To Operators Planning To Commence An Air Service”. Under these rules, an applicant:
– may not hold an AOC issued by another Authority unless specifically approved by the Authorities concerned;
– must have his principal place of business and, if any, his registered office located in the State responsible for issuing the AOC;
– must satisfy the Authority that he is able to conduct safe operations.
The operator must satisfy the CAD that its organisation and management are suitable and properly matched to the scale and scope of the operations and that procedures for the supervision of the operations have been defined.
AOC holders must also have an Air Operating License (AOL).
Fees are payable for both AOCs and AOLs. There are separate fee scales relating to initial application and then annual renewal fees. The fees are related to the size of the aircraft in question and it’s maximum capacity. For more details about the fees and the application process, please contact me.
Hopefully, the information presented above makes it clear that in a wide range of circumstances – both private and corporate – that Malta is an excellent jurisdiction for aircraft registration. If you agree, please get in touch and we can discuss your specific situation.
About The Author
Mark Bencini is an experienced lawyer with many years helping a wide range of corporate clients with their aviation needs at Valletta Legal in Malta’s capital city, Valletta.
How To Get In Touch
If you would like to discuss your specific situation and whether your aircraft and situation might be suitable for Malta, please complete the form below and I shall reply to you within one working day to arrange a time to discuss your needs. My preference is to have a short discussion by telephone or skype to understand your circumstances better at the outset and get a better understanding of whether I and Malta are a good fit for your needs.