Dr. Kelly MamoWhile the process for flagging a commercial vessel in Malta mirrors that of private pleasure yachts, the Merchant Shipping Directorate (MSD) has specific requirements you must meet before they grant approval for commercial registration.
Maltese law is clear on this: a Maltese vessel can operate as a commercial yacht for carrying passengers provided it is properly certified and complies with all safety and freeboard conventions, as well as other applicable laws and regulations.
Registration Requirements
Vessel Size
When it comes to registering vessels as commercial yachts, the Merchant Shipping Directorate prohibits the registration of vessels under 15 metres in length. For eligible vessels, it distinguishes between three specific classes:
- Yachts between 15 metres and 24 metres in length;
- Superyachts over 24 metres in length but under 500 gross tonnes (GT);
- Commercial superyachts over 24 metres in length and 500 GT or more, but under 3,000 GT.
Who Can Register?
Just like with private pleasure yachts, any Maltese or EU citizen, as well as any corporate entity established in Malta, can register a vessel under the Malta flag as a commercial yacht.
However, it is important to note that non-resident owners—such as EU/EEA/Swiss citizens not residing in Malta, or foreign corporate entities—must appoint a resident agent in Malta before they can proceed with commercial registration.
Required Documentation
To flag a commercial vessel, you will need to submit several documents to the Merchant Shipping Directorate, including:
- The owner’s application for registration;
- A copy of the yacht’s International Tonnage Certificate (if applicable);
- Application for a radio station licence;
- Builder’s certificate;
- Survey certificate;
- Bill of Sale or other proof of ownership transfer;
- Proof that the yacht was built in compliance with the law.
The Directorate reserves the right to request additional documents and information on a case-by-case basis if they deem it necessary.
The Registration Process
The registration process for commercial vessels is quite similar to the private process, with a few key exceptions.
Commercial vessels are initially provisionally registered for a period of six months. Once this period concludes and the owner has submitted all final documentation to the Directorate, the vessel receives permanent registration as a commercial yacht under the Malta flag.
Crucially, unlike private vessels, commercial yachts must undergo a survey prior to registration to obtain a Certificate of Compliance to Trade as a Commercial Yacht.
A surveyor, or a classification society recognised by Transport Malta, must be appointed to inspect the vessel. During this inspection, the surveyor will check the radio installation and Global Maritime Distress and Safety System (GMDSS) equipment.
The vessel’s Emergency Position Indicating Radio Beacon (EPIRB) and Automatic Identification System (AIS) (where applicable) will also be tested. The surveyor must also confirm the vessel complies with the Maritime Labour Convention (MLC) and other relevant regulations.
The yacht owner is required to provide the surveyor with all requested documentation to prove the vessel meets all applicable standards.
Once the inspection is complete, the appointed surveyor draws up a survey report. This is submitted to Transport Malta for review. If the Merchant Shipping Directorate is satisfied that everything is in order, they will issue the Certificate of Compliance to Trade as a Commercial Yacht.
This certificate confirms that the vessel meets technical, safety, pollution prevention, and crewing standards.
The certificate is renewable every five years, subject to intermediate surveys carried out by an appointed ship surveyor or recognised organisation.
The Malta Commercial Yacht Code (CYC)
The Commercial Yacht Code (CYC) regulates the industry by setting the standards that all commercial yacht owners must adhere to.
Drafted by the Merchant Shipping Directorate in line with international laws and norms, it covers requirements regarding crew welfare, minimum safety standards, personnel protection, navigation, communication, and pollution prevention.
Given the significant growth in commercial yacht registration in Malta over the last decade, the third edition of the Code (published in 2015) eventually required updating.
Following consultation with various stakeholders—including surveyors, manufacturers, yacht management companies, and builders—the fourth edition of the Commercial Yacht Code was released.
This came into force on 1 January 2021 and applies to all commercial vessels. Existing vessels already certified under the previous edition were given until 1 June 2021 to ensure compliance with the new amendments.
Restrictions and Benefits
Operators should be aware of specific restrictions. Commercial yachts are not permitted to:
- Carry cargo;
- Carry more than 12 passengers.
- Additionally, yachts under 24 metres must undergo an immediate survey, while vessels of 24 metres or more require annual surveys.
However, the Malta flag offers numerous advantages for owners intending to operate commercially, including:
- Access to the Tonnage Tax System, which can significantly reduce the vessel's operating tax burden compared to standard income tax;
- Various VAT and tax incentives;
- No restrictions on the nationality of the company directors or shareholders;
- No restrictions on the nationality of the crew working on board Malta-flagged yachts;
- And much more.
How We Can Help
At DW&P, we guide you through the entire lifecycle of the vessel:
- Resident Agent services;
- Commercial yacht registration;
- Vessel purchase and sale;
- Advisory on formalities and compliance requirements;
- Preparation of necessary forms and documents;
- Company formation (Malta Limited setup);
- Liaising with surveyors;
- Ensuring all deadlines are met;
- Radio licence applications;
- Drafting contracts regarding crew employment, chartering, and more.
For more information, please visit this page.
Disclaimer: The above article is based on independent research by Dr. Werner & Partners and does not constitute legal advice. If you would like to meet with one of our representatives for further information, please contact us to arrange an appointment.
