Malta has cemented its place among the Mediterranean’s yachting hotspots. A record- number of yachts and superyachts have been registered in Malta, with some 10% of the world’s superyacht fleet now flying the Maltese flag. Capitalising on the island’s natural and infrastructural assets that have long made it a sheltered and secure base for vessels, Malta’s marinas compete today with the established hubs in Spain, Italy and France. Yacht owners are attracted by the excellent reputation of Malta’s ship registry, the high level of personal service and the variety of maritime facilities. From its position close to the major arteries of shipping, Malta offers deep natural harbours and well-equipped marinas, as well as ship-repair yards which can take the largest ships afloat. A new €7.5 million marina has just been constructed, inviting the world’s most luxurious superyachts and yacht owners to rendezvous in Malta. However, industry professionals warn, Malta needs to keep its rising costs in check if it wants to be in a prominent position on the internationals yachting map.
Magnet for the Yachting Fraternity
Above all it is the island’s shipping register that has raised Malta’s yachting profile. Being one of only two open registers in the European Union, Malta allows any kind of vessel to register under the Maltese flag. World-famous pleasure boats such as the luxury clipper the Maltese Falcon and the mega-yacht the World is not Enough sail under it. More than 680 superyachts are currently registered in Malta. Superyachts, of which there are some 5,000 globally, are officially defined as boats whose hulls at the water line measure longer than 24 meters. A superyacht requires a professional crew to operate it and costs at least US$6 million. The most appealing aspect of the register is the lack of bureaucracy that surrounds it. Transport Malta, the regulator overseeing the industry, offers yacht owners the opportunity to speak directly with the decision-makers and is on call 24-hours a day to deal with problems from managers or the ships’ staff.
"Malta has the potential to become a leading yachting events destination. There is considerable interest in Malta - ranging from sailing regattas, to power racing and boat shows, as well as yachting awards and conferences."
Wilfried Buttigieg, CEO of Yachting Malta
Regulating for the Industry
The island’s regulations are a big part of Malta’s attraction to yacht owners. They can have their yachts registered as commercial vessels, meaning they pay an annual tax on the tonnage, rather than income tax on earnings. For yachts which are not commercially registered, Malta operates an attractive system for purchasing and leasing. This enables yacht owners to pay VAT on their yachts calculated on the percentage of time that vessels are deemed to have sailed in EU waters – based on the assumption that the larger the yacht, the less time it stays in those waters and vice-versa. Malta also protects superyacht financiers from defaulters. The regulations enable any person with an executive title to obtain a court-approved sale. The Merchant Shipping Act also entitles the mortgagee to take possession of the yacht and to sell it privately to a third party – usually for much more than he/she would get from a judicial sale.
The island has also adopted a reduced VAT rate on short-term yacht charters commencing in Malta. While such charters will continue to be subject to a rate of 18% on the cost of the charter, this will only be applied proportionally, based on the amount of time the charter is in EU waters. Malta’s proximity to North African and Eastern Mediterranean destinations means that a superyacht charter can be undertaken where a significant portion of the time is spent beyond the realms of the EU and its tax rules. At the end of December 2016, Transport Malta also introduced guidelines allowing pleasure yachts to carry more than 12 persons.
Expanding Marine Infrastructure
Already regarded as an ideal location for the winter months, Malta is experiencing growing numbers of yacht owners choosing the island as a home port, with five marinas catering for luxury private and charter vessels. Malta enjoys a mild climate all year round and a competitive cost structure, which help the island compete with other perhaps more fashionable, but often crowded and high-priced Mediterranean home ports. A sixth marina has just been completed. The Marina di Valletta, developed and operated by Italian company Azimut Benetti, provides an additional 274 berths and caters to yachts up to 28 metres. With the new investment, Malta can provide berthing for up to 2,200 yachts. Cafes, restaurants, shops, clubs, cinemas, theatres, sports clubs and gyms are almost always within walking distance of yacht marinas, offering a wide range of entertainment facilities for yacht owners, guests and crew.
Repair and Refit Centre
With a maritime history that dates back thousands of years to the Phoenicians, it is hardly surprising that Malta has built up an industry dedicated to the refitting and maintenance of yachts and boats. The island boasts skilled boat builders, as well as shipyards, slipways and floating docks, catering for any vessel from a modest boat to the most luxurious superyacht. The Grand Harbour, at the centre of the island’s maritime activities, is also home to the main ship and yacht-repair facilities and includes Italian shipyard group Palumbo, Bezzina Ship Repair Yard and Cassar Ship Repair Yard. Manoel Island Yacht Yard specialises in the refitting and repairing of vessels up to 40 metres, while Palumbo’s superyacht facility is regarded as one of the leading repair, maintenance and refit centres in the Mediterranean, capable of handling vessels up to 360 metres. It offers a fully comprehensive service to ship owners whose vessels are in need of repair and/or dry-docking. Some of the world’s best-known vessels regularly use the facilities for both scheduled maintenance and full refits. This segment is also poised for growth as construction of an entire maritime services park, spanning some 175,000 square metres, is currently underway.
Part of Malta’s attraction also lies in the fact that the island is steadily building a wider maritime cluster, including IT companies specialising in marine software engineering and electrical engineering companies developing and installing vessel-management systems. On hand, too, is a wide network of maritime lawyers, insurers and ship-finance banks. Yachting Malta, a joint venture between the Government of Malta and the Royal Malta Yacht Club, is the voice of the industry and its aim is to make Malta a better yachting base. Its primary role is to identify and attract high profile yachting events to the island. A maritime services park is also currently being built, and it is expected to consolidate an already vibrant sector and attract local and international companies.
Offering a favourable framework for yacht registration and lease, Malta is becoming increasingly appealing to yacht owners looking for an unpretentious, beautiful and practical destination. The island intends to maintain and expand its footprint within this industry, and initiatives such as the development of the maritime park promise future growth. Providing modern ship and yacht-repair facilities in combination with specialist facilities, Malta has created a dynamic international maritime service centre for the 21st century. However, although yachting is a lucrative sector, it is a sophisticated industry in which fair pricing, attention to detail and value for money are as important as in other sectors of the economy. If Malta wants to be a competitive contender, pricing for marinas and yacht services, as well as charges for water and electricity, need to be in line with comparable Mediterranean destinations.