Showing posts from September, 2009

Santa Marija Estate (Mellieha) clause unenforceable

The Civil Court has determined that a clause in the contracts for plots at Sta Marija Estate Mellieha, could not be enforced to reclaim the property as it did not preclude the property from being used by people other than the owners.
“This Court disagrees with the meaning of the clause as it was written. The house was being used for “private residential purposes” even if the person living there is not the owner. And there is no link between the house being used as an ordinary residence and as a private residence,” the Court, presided over by Mr Justice Joseph Zammit McKeon, said.

Silvio and Maria Isabella Borg were being sued by Albert Mizzi in the name of Central Mediterranean Development Corporation (CMDC) because the contract for their property in Sta Marija had a clause which said that it was for “private residential purposes only” but the Court said that this should not be interpreted to mean that it could only be used by the owner as a residence. It noted that the Borgs still use…

Maltese property owner wins landmark European Court case over imposed lease

The European Court of Human Rights has ordered the Maltese government to pay compensation to a Maltese landlord who filed a complaint after Maltese law was changed, thus allowing his tenant to continue to live in his property even after a temporary emphyteusis expired.

Mr Philip Amato Gauci said his property rights were infringed as a result of the new law, which imposed on him a unilateral lease relationship for an indeterminate time without providing him with a fair and adequate rent.

He explained to the court that he owned a maisonette in Sliema which in 1975 was granted on temporary emphyteusis for 25 years for a ground rent of €210 per year.
But as a result to a change in the law in 1979, once the term of the emphyteusis expired, tenants were granted the right to retain possession of the premises under a lease, without the consent of the owner. The law did not apply for post 1995 emphyteusis.

Mr Amato-Gauci said he had been unilaterally deprived of his property without being able to …

Betting on the future of online gaming

Editorial Times of Malta September 16,2009(Note: The remote gaming industry is of particular significance to the maltese property letting sector.)
The future of the online remote gaming industry has been seriously threatened by a recent European Court of Justice ruling in favour of the Portuguese government's gaming monopoly and against Bwin, a major online Austrian gaming group that has a subsidiary in Malta.

The case was based on the contention on whether state gaming monopolies, in their pursuit to prevent crime, breach the EU's provisions on free trade in goods and services.

The judgement against Bwin confirms a previous sentence given by the ECJ in 2003 in the Gambelli case confirming that gaming state monopolies "can be justified only for reasons of public health or the prevention of crimes, like money laundering, fraud and game fixing". There are six other similar pending cases in EU courts. The outcomes of these cases are awaited with some trepidation by the onl…

Investing in a low-interest environment

Letter - Times of Malta - Monday, 14th September 2009
Investing in a low-interest environment
Norman Mifsud, Madliena

In his letter Bonds Prospectuses, September 9, (click here to read) economist Karm Farrugia quite rightly tried to explain the terms used by issuers of prospectuses such as "unsecured" and "subordinated" bonds.

Few people except persons in the financial sector really understand the nuances and ranking of these bonds being issued. Investors are in most instances attracted by relatively high interest rates being offered without bothering to study the prospectus and the relevant risks involved.

Relatively high rates may appear quite attractive to investors in an attempt to maintain their level of income in a low interest rate environment.

Moreover, none of these issues or issuers is rated by a recognised rating agency. With the increasing number of companies taking advantage of the prevailing low interest rates offered by the banking sector it may be time fo…

Judgment 'not so bad' for Malta - i-gaming

Note: Also refer to the Times of Malta news report dated September 09, 2009 (Ivan Camilleri - Brussels), available here. Both articles are included on this blog given the impact of the i-gaming industry on the property letting market here in Malta.
The judgment by Europe's top court last Tuesday giving member states the right to ban online gaming websites does not impact Malta's lucrative industry as much as it seems at first glance, the former CEO of the Lotteries and Gaming Authority believes.
Over the past few years, Malta has seen a surge in the number of online gaming companies setting up base here because of favourable legislation and operational conditions, including taxation. In fact, it is estimated that about 10 per cent of the world's remote gaming companies operate from Malta, with the industry directly employing about 2,100 workers.

The former CEO, Mario Galea, who is now an industry consultant, said that although the judgment needed to be studied properly, the …

Property prices drop but sales remain strong

Property prices continued to drop in the first three months of this year but were up by nearly 14 per cent when compared to the same period in 2007, which was considered by the industry as a good year.

The National Statistics Office said the prices of all properties registered a decline of 2.83 per cent when compared to the corresponding period last year.
The price of apartments dropped by 5.26 per cent while that of maisonettes dropped by 2.19 per cent.

Although the NSO figures showed that sales were down by over 15 per cent, industry sources said the decrease was more gradual than that.
Estate agents said there was a decline in sales to British customers, mainly because of the unfavourable sterling to euro exchange rate.

The estate agents said that they had seen a change in mentality by the sellers, who are now pricing their properties closer to the market value. Before, they would inflate the price, hoping to get more than what the property was worth on the market.
Moreover, they said th…

Sliema council objects to proposed changes at Tigne project

The Sliema council is objecting to the change of use of a tower proposed as a hotel in the Tigne Project to residential apartments.

In a statement it said it was objecting to this change of use since itwould result in overdevelopment in an already overpopulated area.

"This tower should remain a hotel as was approved in the Development Brief.
"The council is also conscious that such a height was permitted in the development brief due to the fact that such a hotel would generate more jobs and hence contribute to the island’s economy.

"The proposed change of use would also create a serious impact on the amount of traffic influx of vehicles coming in and out of this area.
"It is evident that there will be already a massive increase in traffic coming from existing residents, new residents, delivery trucks that will supply all the commercial and catering establishments (once in operation) along with the people who will come to shop or work in new offices.

"The daily traff…

NSO data issued today. House prices, sales decline

House prices dropped by 2.83 percent in the first quarter of this year, according to NSO data issued today, September 10 2009. (Download NSO data in PDF format by clicking here.)
The NSO said that the All-Property Price Index stood at 156.99, a decline of 2.83 percent compared to the corresponding period last year.

"This primarily reflected a decrease of 5.26 percent in the apartments index, and of 2.19 percent in the maisonettes index, compared to the corresponding quarter last year.
"However, when compared to the corresponding period in 2007, prices were up by 13.42 percent," the NSO said.

The All-Transactions Volume Index showed that the number of transactions in the first quarter of 2009 declined by 15.11 percent when compared to the corresponding period in 2008. This year's volume indices were also the lowest in the six-year period under review.

Follow article link.

Bonds prospectuses - Letter (Times of Malta)

Times of Malta - Letter to the Editor
Wednesday, 9th September 2009

Bonds prospectuses

Karm Farrugia, Madliena
The two current corporate bond issues describe them as "unsecured and unsubordinated". Previous ones having been "subordinated", there was obviously no point to mention "security" or its absence.
Not so with "unsubordinated", since this might well induce the ordinary investor to infer some kind of security. It always baffles me why prospectuses meant for public consumption use phrases which are beyond the public's comprehension. Why not just circularise them among the professionals and merely advertise their highlights?


Sergio Galea Vincenti
I share - totally - Mr. Farrugia's concerns: In my opinion, prospective subscribers to bond issues should always ensure they read the small print published in any prospectus and always ensure they get the right clarifications and advice before committing themselves to any subscription.

My co…

Setback to Malta gaming industry

Note: The folowing news report appeared in the Times of Malta, September 09, 2009 and is mainly of interest, given the real estate context of this blog, to the property letting sector.
Also of particular interest, is a counter-news report, appearing in the Times of Malta September 12, 2009 and also available on this blog in its entirety here.

Malta's lucrative internet gaming industry suffered a major blow yesterday after Europe's top court ruled that EU member states could ban gambling websites.
The judgment was delivered in a case filed by Bwin, one of the largest internet gambling companies in Europe with subsidiaries in Malta, against the Portuguese state monopoly.

Online internet companies across the EU have been fighting member states such as France, The Netherlands and Germany that insist on protecting their state monopolies to eliminate rising competition from online betting companies registered in other EU member states.

Yesterday's judgment, which can be interpreted …