Defined in the United Nations Convention on the Law of the Sea, the flag state is the state exercising jurisdiction and control in administrative, social, and technical matters over ships flying its flag. Therefore, each State which is party to the Convention must keep a register of ships with the names and details of ships flying its flag, and under its domestic law, assume jurisdiction over each ship flying its flag and its master, officers and crew in respect of administrative, technical and social matters concerning the ship. One question remains: what determines the choice of your flag?
Manning
Maltese ships are subject to the provisions of the Merchant Shipping Act (1973) and ancillary regulations concerning the competency of officers and seamen. There are no restrictions on the nationality of the master, officers and crew engaged on Maltese yachts and superyachts.
International Conventions
Malta prides itself in having adopted all the major international maritime conventions including both those targeted towards ensuring safety at sea and others targeted towards environmental conservation.
Notable conventions include the International Convention for the Safety of Life at Sea (STCW, 1978), the International Convention for the Safety of Life at Sea (SOLAS, 1974), Tonnage 69, Load Lines 66, the Convention of the International Regulations for Preventing Collisions at Sea (COLREGs, 1972) and the Convention on the International Maritime Satellite Organisation (INMARSAT), all of which promote safety of life and property at sea.
Other maritime conventions to which Malta is party which are more oriented towards the conservation and protection of marine environment comprise the following: the International Convention for the Prevention of Pollution from Ships (MARPOL, 1973), the International Convention on the Establishment of an International Fund for Compensation for Oil Pollution Damage (FUND 71), and London Dumping 72.
Malta is also party to conventions geared towards combatting climate change. It has ratified the United Nations Framework Convention on Climate Change (UNFCCC), and the Paris Agreement, which builds upon the Convention and brings nations together to effectively combat climate change and its effects.
Why is this important?
Further to being party to the Paris Agreement, Malta is also on the whitelist of the Paris Agreement Memorandum of Understanding on Port State Control (Paris MoU). What is a whitelist? This list is a low risk ship list, making a Malta registered vessel less likely to be detained at ports. This highlights the reputability of the Maltese flag.
Building upon this reputability is the fact that Malta has been a pioneer in the development of international maritime law. On 17th August 1967, Maltas first Permanent Representative at the United Nations, the late Maltese diplomat Dr Arvid Pardo, tabled a UN proposal which resulted in what we now know as the United Nations Convention on the Law of the Sea (UNCLOS). This is what earned Dr Pardo the title Father of the Law of the Sea. Evidently, Maltas efforts towards establishing a comprehensive set of rules governing the oceans were integral towards achieving the sound international maritime legal framework that is UNCLOS.
Authorised Classification Societies
Survey, tonnage and convention certificates may be issued on behalf of the Maltese Government by the following classifications societies: American Bureau of Shipping (ABS), Bureau Veritas (BV), China Classification Society (CCS), Croatian Register of Shipping (CRS), Class NK (NK), DNV-GL, Korean Register of Shipping (KR), Lloyd’s Register (LR), Polish Register of Shipping (PRS), Registro Italiano Navale (RINA), and Russian Maritime Register of Shipping (RS).
Mortgages
Registration, transfer and discharge of Mortgages may be effected immediately on presentation of the relative documents to the Registrar. The 1986, 1988, 1990 and 2000 amendments introduced important safeguards to the mortgagees of Maltese ships, making financing more attractive. A ship registered in Malta together with its equipment, machinery and other accessories, or any share therein, may be made a security by way of mortgage. A mortgage is indivisible notwithstanding the divisibility of the underlying debt which it may secure. A mortgage over a Maltese ship shall have effect vis–vis third parties once it is duly recorded in the register. The priority of mortgages over the said ship is determined by the date and time of their record in the register.
Maltese mortgages offer adequate protection to ship financiers for the following reasons, among others:
- They enjoy a high priority in an eventual ranking of claims against a Maltese ship
- Mortgages constitute executive titles and may be enforced immediately without the need to institute lengthy court proceedings
- They attach to any proceeds from any indemnity as well as any insurance proceeds
- A mortgagee may prohibit the registration, without his prior written consent, of subsequent mortgages in favour of other creditors, unless such further mortgage is executed in favour of an existing mortgagee
- The Registrar of Ships is bound to notify the mortgagee upon the transfer of a registered ship to a new Maltese owner
- The sale of a Maltese ship to a foreign owner requires the prior written consent of all registered mortgagees;
- A mortgagee may apply for any extensions, pay fees and do all such things in the owners name in order to maintain the status and validity of the ships registration.
Closure of Registry
The registry of a Maltese ship may be closed at the request of the owners provided all liabilities and obligations in respect of the ship towards the State of Malta have been paid and the consent of all registered mortgagees is produced.
