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A Decade of Maltese Aviation Jurisdiction

27 OCTOBER 2021:

A Decade of Maltese Aviation Jurisdiction

Mr Joseph Bugeja, Chairman & CEO of Transport Malta

Good morning ladies and gentlemen.

It is my pleasure to finally be here today to meet and share our thoughts, experiences, and opinions on how to build upon our decade of success of our vibrant aviation industry. I am sure you will all agree that nothing beats the thrill of meeting friends and colleagues here in a real physical conference.

As the main partner of this event, I feel proud that, notwithstanding all the challenges brought about by the pandemic, we managed to move forward, now with greater impetus, to ensure that MACE remains a calendar event for the Malta Aviation sector for many years to come.

Malta’s success as an Island nation always depended on exploiting its coveted geographic location. Being located in the centre of the Mediterranean does make Malta an ideal base for shipping, maritime activities, civil aviation, and the associated ancillary services. Nevertheless, I honestly think that the foundation of everything we have achieved today as a nation is due to our natural ability to adapt to the prevailing circumstances and acting swiftly but smartly to seize opportunities in the markets. Our thriving Maltese aviation sector and the creation of an aviation framework, aimed at enhancing aircraft registration and aircraft operator licensing, is a prime example of this.

Although Malta has a long-standing aviation infrastructure, the major breakthrough was achieved in 2010 with the enactment of the Aircraft Registration Act. Such legislation aimed to replicate the success achieved in ship registration in the already thriving aviation sector and helped to enhance the aviation framework on the islands.

The introduction and updating of legislation provided the necessary impetus that enabled the onset of the Aviation Malta cluster, which I consider as one of the major contributors to Malta’s status as a successful aviation centre, particularly in aircraft registration sector. As at the end of 2010, the Malta national aircraft register had 92 aircraft registered, 17 of which were newly registered craft.

During the past decade, the Civil Aviation Directorate within Transport Malta has intensified its efforts to update the legislative framework related to Aircraft registration in Malta. Such changes resulted in a win-win scenario for all parties involved as they incorporated a more flexible regime that enables the investor and airline to better market their offering. Οn the other hand, such changes consolidated the oversight and the overall regulation by the Directorate. As the Chairman and CEO of the Authority responsible for Transport in Malta, I am well versed with the notion that our key function is regulation. However, the term regulator can sometimes be a misnomer indeed. Although the essence of a regulator in any industry is to create, implement, and ensure the proper regulation of the sector, I think the Authority’s role within the Maltese aviation industry goes a bit beyond that. Whilst ensuring a level playing field and enforcing the relevant regulations that the Government and the Authority has enacted over the years, I strongly believe that another primary role of Transport Malta is to be a real instigator of innovation, spurring innovative thinking and be a growth enabler for all stakeholders of the Malta aviation sector.

Implementing innovative ideas necessitates substantial investment both in soft and hard infrastructure. We invest a lot on promotion but still believe that our most important asset is our human resources, not just our own competent personnel at the Aviation Directorate but as a cluster of knowledgeable persons with diverse backgrounds and specialisation, all aligned towards servicing our clients with diligence.

Today, our aviation register has grown almost five-fold since its inception in 2010, with over 600 craft bearing the 9Η registration mark. More airlines, particularly larger airlines, are nowadays choosing the Maltese jurisdiction. This is testament to the excellent reputation the Maltese jurisdiction has managed to build within the aviation sector.

The past decade has been a journey. At the beginning, we started focusing on small companies and being extremely attentive to their needs, something which bigger jurisdictions might have overlooked due to their size. We knew we were on a learning curve but once the pace started to gather, we learnt to be resilient, tenacious and gained experience.

The aviation world is huge, but it is also a very tightly knit network that value recommendations from trusted partners in the industry. Malta’s jurisdiction was being noticed and without sounding too pretentious, also recommended.

With further investments in promotion, Malta slowly started to shed off the notion of the new kids on the block. At the same time, we stepped up our investment in our human resources and the Aviation Directorate started to grow to keep up with the regulatory function of the register. We knew that investment in new personnel and training of existing staff is very challenging but we also believed that it’s a prerequisite to success. I must admit that the Authority’s experience gained from managing the largest European shipping register was extremely valuable as both industries do have similar characteristics in management and regulatory terms.

The aviation industry is one of the sectors hit hardest by the ongoing consequences of the COVID-19 pandemic, threatening to reverse some of the progress that has been achieved throughout the past few years. Although the industry has suffered in terms of commercial travel, we have seen an increase in companies choosing to apply for an AOC under Malta's jurisdiction. Firmly supported by the Government, we also managed to stay strong and in fact managed to register 180 new aircraft in the past year.

In addition to the increase in AOCs that Malta has issued, the business jet sector has also seen a steady increase over the past seven years. There has also been an increase in business jets being converted to accommodate larger groups as well as a notable increase in cargo jets as cargo transportation shifted from commercial flights to cargo flights due to COVID-19 pandemic.

Nevertheless, one determining factor that enabled us to grow significantly over the past decade was our ability to update our legislation. In the beginning, our adherence with the Cape Town Treaty, gave our aircraft register a distinct advantage that many operators valued and embraced as it guarantees and protects the rights of aircraft owners and permitted further creditor trust in the jurisdiction for aviation purposes.

The treaty and its aircraft protocol lay down rules, enforcement and priority status of interest in mobile equipment. It also protects the right of owners to grant irrevocable de-registrations and export request authorisation to a secured party. Moreover, the treaty establishes the Civil Aviation Registry as the Authorising Entry Point.

But in order to stay at the forefront of the industry we had to move quickly to take advantage of our nation’s ability to adapt and quickly implement cutting edge legislation that takes account of the needs of clients for the near future. We also wanted to ensure that the regulatory framework for companies registered in Malta remains competitive as it grants access to the EUs Internal Market for Aviation.

We want to innovate and be pragmatic. We work consistently to improve our systems and our efficiency. Customers appreciate we understand the business aspect of aviation. We work to ensure that businesses safely achieve success by paying individual attention to every operator. This also means that we are open to new business models and actions that further enhance connectivity. Within this context, the role of regulation assumes a different dimension as regulation provides an essential framework for the successful interaction between all stakeholders. Implementing regulations sometimes needs bold decisions, political courage and thinking out of the box. Regulation must also focus on the future by creating new opportunities for our people, businesses, and aviation community.

Today, the brand Aviation Malta has become the hallmark of service excellence, reliability, and most importantly, represents confidence in the jurisdiction that is much cherished by both the owners and the industry at large.

I thank the organizers for the kind invitation and thank you all for listening to me.


Chairman - MACE

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