Maltese aviation: Aiming high

Draft legislation entitled the Aircraft Registration Act 2009 is expected to be tab-led in Parliament shortly by the Minister for Infrastructure, Transport and Communications Austin Gatt. The draft has been posted on the ministry's website as a second round of stakeholders' consultation commences.

The new legislation is drafted with a view to establish an appropriate legal framework that would help create and effectively support a successful aviation register in Malta and follows an exhaustive review of existing laws applicable to Malta affecting aviation, extensive research on various jurisdictions renowned for aviation services and also public consultations with various stakeholders in the aviation industry.

While generally consolidating the laws on registration of aircraft into a single Act, the new draft law has been written with the aim of attracting more aviation-cluster business to Malta and not limitedly to creating aircraft registration incentives. The relevant regulatory body for this sector will be the newly-created Authority for Transport in Malta. This was established in terms of the recently-enacted Authority for Transport in Malta Act 2009, which provides for the establishment of a single transportation authority that will assume the functions previously exercised by various separate transport regulators.

A major feature of the proposed Act is that, while extending the scope of granting security over aircraft, it would also transpose the provisions of the Cape Town Convention on International Interests in Mobile Equipment and the Aircraft Protocol thereto by adopting the National Implementing Legislation prepared by the Aviation Working Group for acceding states. Malta, in fact, is expected to accede to the said Convention shortly.

Registration of security interests in the International Register set up pursuant to the Cape Town Convention is fast becoming a market standard in aircraft finance transactions and Malta will be well-positioned to meet market requirements in this sphere and could pride itself in taking a lead role within the European Union by adopting the Model National Implementing Legislation into its domestic laws.

The new Act introduces a number of innovative concepts in order to make the Maltese Aviation Register competitive with the world's leading aviation registers and has limited nationality and form requirements as much as possible in order to make the register accessible to as many owners and operators as possible provided they comply with the standards imposed by the law.

The new law also caters for market realities such as fractional ownership and the ownership of aircraft by trustees or the possibility to register an aircraft while still under construction when it is uniquely identifiable.

The articles dealing with security interests over aircraft brought about the need to regulate the interplay between the National Aircraft Register and the International Registry set up under the Cape Town Convention.

The new law should attract considerable attention from owners, operators and financiers.

The Department of Civil Aviation, in tandem with the legislative changes, is also embarking on a capacity building exercise in order to ensure that the industry's demands are met with efficiency and the highest standards of competence and professionalism. Malta has a tremendous opportunity with the new legislation in place to continue to shape the future of aviation services in Malta and further strive for excellence and competitiveness.

All those interested in this area of commercial activity are invited to review the draft legislation and make comments for its improvement so that, by the time the draft is tabled in Parliament, Malta shall have the best possible product to support this industry.

Dr Aquilina heads the aviation practice at Ganado & Associates and was a member of the team at Ganado & Associates involved in advising the Ministry of Infrastructure, Transport and Communications and drafting the new legislation.