Malta thrust to consolidate aircraft registration

Buoyed by its worldwide success in the maritime sector, Malta is now embarking on a parallel bid in the registration of aircraft. There are already a number of very interested aircraft owners, including one airline that by the end of the year will have 12 large aircraft on the Maltese register, and another that wants to register its helicopters.

Introducing the second reading of the Aircraft Registration Bill, Transport Minister Austin Gatt said it would modernise the situation in Malta regarding title to aircraft, as well as create the possibility of another outlet akin to the very successful registration of ships.

Not only had Malta achieved success in the latter sector since 1988-89, but from 27 ships the country now had more than 5,200 vessels registered with a tonnage of over 36 million. Malta's register was now one of the biggest in the world and the second biggest in the EU, but most importantly enjoying a very good reputation in the maritime sector.

Every party in government over the years had gone by a policy of agreement on strengthening the register. The service offered had always been recognised as one of the best, despite offering no tax advantage. The greatest reasons for this popularity were the very efficient service, open 24/7, unlike other registers, respecting both local and foreign legislation especially International Maritime Organisation (IMO) conventions.

Malta's very successful and professional maritime register had started from very humble beginnings, creating employment for several specialised sectors and at great financial benefit to the country.

Minister Gatt said the economic sectors Malta needed today were not those of the past. Great changes needed to be introduced at an increasing rate.

Manufacturing, even though advanced, would gradually shrink, and there was more competition in tourism. It was known that the present services sector would go to other countries that could offer greater incentives.

If Malta started creating particular new niches it could compete with more aggression, as shown in online gaming, but there was no guarantee this sector would be there forever, either. In the face of accelerating world competition and economic change in several countries, Malta must also be capable of ensuring that new niches would leave more added value. IT and financial services now attracted higher services such as aviation maintenance and pharmaceutics. These were not traditional services, but of high added value.

Minister Gatt said Malta could take comfort in the great success it had achieved in various sectors, extensively helped by the adaptability of Maltese workers who were as capable as any other foreign worker. From scratch Malta now had 3,600 employed in online gaming, and hundreds of aviation technicians who were qualified to work anywhere.

Now Malta was starting on the long track to become for aviation what it had become for the maritime sector in 30 years. But the country could not expect to become the centre of aviation overnight. It would certainly be giving an efficient service and that something that others could not give.

The Bill was a very studied piece of legislation that had been more than a year in the making. The draft was being presented after extensive comparative analysis of competing fiscal regimes. It would be targeting aviation across the board, but particularly private aviation.

Dr Gatt said this did not mean that other countries' national airlines would not be welcome to register their aircraft, but there would be understandable political reasons to prevent this. Malta's aviation register was not being expanded at the best of times for private aviation, but it was the best of times when owners were looking for high standards, going for reputation instead of being happy with anything. Malta's Department of Civil Aviation (DCA) was second to none in safety and standards, but it had a duty to start now to prepare for the expected influx of new registrations.

There would be no compromise on making Malta's aircraft register one of high standards. The register was not being started from scratch because it already featured 83 aircraft including the Air Malta and AFM fleets but also microlight and private aircraft. There were already a number of very interested aircraft owners, including one airline that by the end of the year would have 12 large aircraft on the Maltese register and another that wanted to register its helicopters.

The basis of success would include ensuring high technical standards to convince the EU of the seriousness of Malta's aviation register. Admittedly the country did not yet have enough people to handle the expected influx, and foreign experts would have to be imported in the initial stages.

The pillars of the aviation register would be technical excellence and excellence of service around the clock.

Dr Gatt said another important pillar would be political consensus, and the opposition's already-promised support was highly appreciated.

The register would be open to a very wide range of aircraft registration, including mortgaging and fractional ownership. Malta would be subscribing to the Cape Town Convention on International Interests in Mobile Equipment and its Aircraft Protocol (CPTC), which regulated all transactions concerning financing, transfer and ownership of aircraft.

The EU itself was already party to the convention, and there would be wide consultation with the governing body of the CPTC without which the project could not advance.

The Malta register would be offering a number of fiscal incentives, such as accelerated depreciation, but there was a limit to such incentives because the competition would soon be on Malta's back. It would be service and efficiency that would make the final difference.

Round-the-clock operation, for instance, would make a big difference to aircraft owners.

Concluding, Dr Gatt said Malta was making an important first step, to be followed by others. The government had started to activate a marketing plan in fairs and through one-to-one meetings in order to make Malta's presence felt in the sector. The first few contacts were already bearing fruit in France, the United Kingdom and Italy.

Four government back-benchers - Ċensu Galea, Francis Zammit Dimech, Michael Frendo and Chiarló Bonnici - also took part in the debate. Their contribution would be reported tomorrow.

Winding up the debate, Minister Gatt said his major fear was the possible internal inability to change cultures to attain the necessary changes.