A mortgage over a yacht with a Maltese Flag may be registered in the Registry of Shipping at the Merchant Shipping Directorate by the filing of a mortgage deed. CSB Group assists its clients through the process for a smooth registration.
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Mortgages over Yachts with a Malta Flag
Mortgages are recorded in the order in time in which they are registered with the Registrar. Further mortgages or transfer of the vessel without the mortgagee’s prior written consent may be prohibited by a specific clause in the mortgage deed.
Some Protection afforded to the Mortgagee
A mortgaged vessel may not be deleted from the Maltese Register without the mortgagee’s prior written consent. In addition, a vessel may not be struck off the Register by the competent authorities without at least one month’s notice being given by the Registrar of Shipping to the mortgagee, and furthermore if the vessel is deleted in such circumstances, the Merchant Shipping Directorate will issue the deletion certificate save for any registered encumbrances and consequently the mortgage continues to attach to the vessel.
Permanent Registration under the Malta Flag
In order to obtain permanent registration certain documentation will be required and it is important to note that the MSD may impose additional specific requirements depending on the different types of vessels. The permanent Certificate of Malta Registry is renewable on an annual basis and an annual fee is due to MSD. Renewal is due annually from the date of initial registration.
Enforcement of Mortgages
In the event of default of any term or condition of a registered mortgage, the mortgagee may upon giving notice to the mortgagor take possession of the ship and have the power absolutely to sell the ship or share therein, in respect of which he is registered. All mortgages, whether principal and interest or account current, are executive titles and enforceable upon default of the debtor without the need of a prior court judgment to enforce such mortgage. The Merchant Shipping Act also provides that foreign mortgages will be recognised as a mortgage and thereby benefit from mortgage status under the Merchant Shipping Act if all the requirements contained therein are met.
Apart from the mortgagee’s rights to take possession and sell the vessel secured by mortgage, upon default, the mortgagee is also empowered to take over and complete vessel registration formalities. Claims secured by a mortgage enjoy high ranking.
We have used CSB Group's Yachting Services in Malta and we would like to highlight the team's professionalism and reliability throughout the registration process of our vessel. We were very pleased and very appreciative of the great availability of the staff to help us and answer our questions.
Tikiaora Inc Limited of Tikiaora | Stephanie Butikofer