Aviation Law

Aviation law governs every aspect of air travel. It applies to parties that provide services, such as airlines, pilots, maintenance crews, security personnel and air traffic controllers. However, it equally affects those that purchase air travel services, such as passengers and couriers. Lexvirtualis™ offers assistance in relation to all aspects of aviation law, ranging from aircraft registration to carriage of goods and passengers by air as well as aircraft finance, sales and purchases, and leasing.

Malta is a party to a substantial number of international aviation conventions, such as the Chicago Convention in International Civil Aviation and the Convention for the Suppression of Unlawful Acts against the Safety of Civil Aviation and its Protocol. Moreover, the fact that Malta is a European Union member State adds value to its aircraft registry, such as allowing free operation within the EU. Malta’s most notable domestic laws dealing with aviation are the: Aircraft Registration Act, Civil Aviation Act, Civil Aviation (Security) Act) the Airports and Civil Aviation (Security) Act, the EUROCONRTROL Act, the Civil Aviation (Air Operators’ Certificates) Act as well as the Authority for Transport in Malta Act and all regulations made thereunder.

Since relatively recently, Malta is establishing a prominent reputation for itself as a centre of excellence in the aviation industry and thus attracting ever-increasing investment, especially upon enacting its Aircraft Registration Act in 2010, and promulgating the relevant regulations thereunder. Contemporaneously, Malta acceded to the Cape Town Convention on International Interests in Mobile Equipment and its Aircraft Protocol in 2010. Moreover, Malta has introduced tax incentives which are attractive to the aviation industry, thus rendering itself a suitable jurisdiction for aviation operations. Aviation and aircraft operations are handled by Transport Malta (Aviation) and its Civil Aviation Directorate.

Why is Malta an attractive jurisdiction for the aviation industry?

• It maintains a reputable and ever-expanding aircraft registry

• It adheres to a vast number of international aviation conventions

• It is a member of the European Union Aviation Safety Agency (EASA)

• Its corporate tax rate (35%) entitles shareholders to a 6/7ths refund resulting in an effective tax rate of 5%.

• Exemptions from taxation of certain fringe benefits

• Waiver of withholding tax on lease payments (providing lessor is not considered a tax resident in Malta)

• Mutual recognition of Air Operator’s Certificates (AOCs) as well as licenses in relation to crew, pilots, engineers, etc.

• Income derived from aircraft operations vis-à-vis international transport is deemed to have arisen outside Malta (remittance basis), as well as other exemptions

• Favourable minimum depreciation periods in relation to aircraft and their engines ranges (over 6 years) whilst said period for the interior of the aircraft and other parts ranges over 4 years.

• Recognition of fractional ownership of aircraft

• Domestic laws provide clear and effective remedies to creditors

• Recognition and enforceability of foreign judgments against debtors

Our services include:

• Aircraft registration (including de-registration) and certification

• Aircraft sale and purchase

• Aircraft leasing (and related agreements as well as VAT schemes)

• Aircraft chartering and private charter structures

• Aircraft financing (eg. loans, mortgages, special privileges)

• Formation and incorporation of aircraft ownership and management companies.

• Drafting of aviation related agreements (eg. servicing maintenance and repair agreements, MRO agreements, etc)

• Insurance

• Carriage of goods and passengers and code sharing.

• Regulation and compliance

• Registration and enforcement of mortgages and other interests.

• Air Operator Certificates and Air Services Licences

• Registration of security interests

• Taxation on aircraft operation, tax planning and tax deductions

• Arrest, seizure and repossession of aircraft

• Ranking of secured creditors

• Claims against carriers and litigation

• Legal support and advice relating to the above