Aircraft Registration in Malta
The Malta Aircraft Registration Act 2010
The Malta Air Operators Certificate (Malta AOC) and Aircraft Registration Malta Act 2010 consolidates the previously existing laws on aircraft registration. Through the establishment of an ambitious aircraft register and the setting up of the Malta Transportation (Regulatory) Authority, Malta is now also well positioned into one of the EU’s most topical business opportunities.
The Malta Aircraft Registration Act provides for the innovative concept of the registration of aircraft under construction. Such can be registered so long as such aircraft is uniquely identifiable. The Malta Aircraft Registration Act endeavors to limit nationality and form requirements in order to make the register accessible to as many owners and operators as possible, while ensuring that the register is not open to anyone and everyone.
To this effect the Malta Aircraft Registration Act prescribes those persons who are qualified to register an Aircraft whether used for the provision of air services or otherwise. These include:
- Citizens of Malta who have approved residence in Malta and citizens of Member States of the European Union, EEA State or Switzerland. Such individuals must have a place of residence or business in Malta, the European Union (EU), the European Economic Area (EEA) or Switzerland;
- An undertaking formed and existing in accordance with the laws in Malta, a Member State of the European Union, the EEA or Switzerland. In terms of the Malta Aircraft Registration Act, the undertaking must have its registered office, central administration and principal place of business within Malta, the EU, the EEA or Switzerland, whereof not less than 50% of the undertaking is owned and effectively controlled by the Government of Malta or by the Government of any other State of the EU, or by the persons abovementioned in paragraph (a), this requirement ought to be present indirectly or directly through one or more intermediate undertakings.
In accordance with the Malta Aircraft Registration Act, a natural person who does not qualify under paragraphs (a) and (b) above, but is a citizen of or an undertaking established in an approved jurisdiction shall be qualified to register aircraft in construction or one which is not used to provide an air service. This delineates the legislator’s intent to widen the scope of the Malta Aircraft Registration Act and consequently expand the range of those who could register under this law. This extends the possibilities for those owners of aircraft who will be using their aircraft for private use and not for hire or reward as prescribed by the pertinent legislation.
Malta VAT Treatment on Aircraft Leasing
The Maltese VAT Department has also recently launched a new aircraft leasing procedure, making Malta an attractive jurisdiction for aircraft registration for both private and commercial aircraft while ensuring full adherence to EU laws and regulations. The net result from this VAT simplification procedure is that the Malta VAT rate of 18% is only payable on that portion of the lease payment which is deemed to be for the use of the aircraft within EU airspace. The minimum percentage of time that an aircraft could be deemed to be in EU airspace, depending on maximum take off mass, maximum fuel capacity, fuel burn, optimum altitude and cruising speed) is of 30%, thereby resulting in a minimum effective VAT rate of 5.4%.
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