ATT Nru XV tal-2019 ACT No. XV of 2019 ATT maħruġ b’liġi mill-Parlament ta’ AN ACT enacted by the Parliament of Malta.

Suppliment tal-Gazzetta tal-Gvern ta’ Malta, Nru. 20,202, 31 ta’ Mejju, 2019

Taqsima A

MALTA

ATT Nru XV tal-2019

ACT No. XV of 2019

ATT maħruġ b’liġi mill-Parlament ta’

AN ACT enacted by the Parliament of

Malta.

Malta.

AN ACT to provide for the regulation

ATT biex jipprovdi għar-regolamentazzjoni

and administration of the affairs of

u l-amministrazzjoni tal-affarijiet li

Free Zones in Malta with a view to

jirrigwardaw Żoni Ħielsa f ’Malta

fostering economic development and

bil-għan li jinkoraġġixxi l-iżvilupp

the generation of employment in Malta

ekonomiku u jiġġenera impjiegi f’Malta

and the determination and regulation

u sabiex jiddetermina u jirregola

of undertakings authorised to carry on

l-impriżi li huma awtorizzati jwettqu

activities within any Free Zone, without

attivitajiet f’xi Żona Ħielsa mingħajr

prejudice to the applicable provisions of

preġudizzju għad-dispożizzjonijiet

the Import Duties Act and of the Union

applikabbli tal-Att dwar id-Dazji ta’

Customs Code.

Importazzjoni u l-Kodiċi Doganali tal-

Unjoni.

ATT TAL-2019 DWAR ŻONI ĦIELSA F’MALTA

The short title of this Act is the Malta Free Zones Act,

2019.

(1)

In this Act unless the contents otherwise requires

Interpretation.

"Commissioner" means the Commissioner for Revenue, and

includes any other person having an express or implied authority to

act for the said Commissioner in carrying out the provisions of this

Act;

"determined undertaking" means an undertaking determined as

authorised to operate within a Free Zone under article 9;

"Free Zone" means an area in Malta designated as a Free Zone

in accordance with the provisions of article 3 and referred to in any

Schedule to this Act;

"guidelines" means any set of rules issued by the Authority from

time to time for the further implementation of the provisions of this

Act and of any regulations issued hereunder;

"Minister" means the Minister responsible for Malta Enterprise;

"State Aid Monitoring Board" means the Board established

under article 57 of the Business Promotion Act;

"undertaking" means any individual or body of persons, whether

having a distinct legal personality or not, who or which carries on any

form of enterprise including the exercise of any trade or business,

profession or vocation and includes any association or other body of

persons which promotes or supports the goals and objectives of such

undertakings;

"Union Customs Code" means the Union Customs Code

adopted on 9th October 2013 as Regulation (EU) No. 952/2013 of the

European Parliament and of the Council as amended by Regulation

2016/2339 and as may be further amended from time to time, as well

as any other delegated legislation issued to supplement such

legislation.

(2) Any reference in this Act to any law or provision thereof,

shall be construed as a reference to that law or provision as from time

to time in force and shall include a reference to any enactment

replacing such law or provision (including the imposition of any taxes

whatsoever analogous to or in substitution to those contained in such

enactments or provisions) and to any subsidiary legislation made

thereunder.

(3) Words and expressions used in this Act with reference to

another law shall, so far as necessary to give effect to this Act, and

consistently with the provisions thereof, have the same meaning as

they have in the law with reference to which they are used in this Act.

(4) In this Act and in any regulations made thereunder, if there

is any conflict between the English and Maltese texts, the English text

shall prevail.

PART II

Free Zones

(1) The areas or parts of Malta designated by the

Minister responsible for Customs as Free Zones shall, for all intents

and purposes of this Act and of any other law, be designated for use as

Free Zones in terms of the applicable provisions of the Import Duties

Act and of the Union Customs Code or any substituting or

supplementing legislation as may be applicable from time to time

Provided that the provisions of this Act shall not apply to

any area of Malta designated by the Minister responsible for Customs

as a Free Zone and which is specifically governed by any other

enactment.

(2) The applicable provisions of the Import Duties Act and of

the Union Customs Code or any substituting or supplementing

legislation as may be applicable from time to time shall govern the

operation of any Free Zone and the activities that are carried out

therein.

Except as otherwise provided in this Act, the provisions of

the Government Lands Act shall not apply to any land as defined in

article 2 of the said Act when such land is situated within a Free

Zone.

PART III

Free Zones Authority

(1) Without prejudice to the authority vested in the

Commissioner in terms of sub-article (2), and in terms of the Import

Duties Act, any legal person from time to time designated to act as

such by the Minister shall constitute the Free Zones Authority,

hereinafter in this Act referred to as "the Authority", until such time

as such authorisation is revoked by the Minister.

(2) The Commissioner shall be vested with all powers

conferred thereon in terms of the Import Duties Act, including among

others

(a)

supervision of the perimeter of each Free Zone and

the entry and exit points thereof;

(b) control and supervision over persons, goods and

means of transport entering or leaving each Free Zone;

(c)

approval and supervision of the construction of any

building in any Free Zone;

(d) the right to be presented with goods brought into a

Free Zone and the authority to subject such goods to the

prescribed customs formalities, where so required in terms of

the Union Customs Code;

(e)

establishment of customs status as Union goods

when goods enter a Free Zone, when they have undergone

processing operations within a Free Zone or when they have

been released to free circulation in a Free Zone;

(f)

any other functions of control and supervision

vested in the customs authorities of member states of the

European Union in the context of Free Zones in terms of the

Customs legislation of the European Union.

(3) It shall be the duty and function of the Authority

(a)

to administer the affairs of each Free Zone with a

view to fostering economic development and the generation of

employment in Malta;

(b) to authorise and regulate undertakings authorised to

carry on activities within any Free Zone, and to determine the

activities which such undertakings shall be allowed to carry on

within any Free Zone;

(c)

to provide and manage land, sites, premises, services

and facilities for undertakings authorised to carry on activities

within any Free Zone;

(d) to liaise with all Ministries and departments of

Government and all bodies and other authorities established by

law in the carrying out of its functions and responsibilities in

terms of law;

(e)

to advise Government on all matters relating to Free

Zones;

(f)

to issue guidelines to supplement the provisions of

this Act and of any regulations made thereunder;

(g) to do all such other acts as may be necessary or

conducive to the attainment of any or all of the said objectives.

(4) Without prejudice to the generality of the provisions of

sub-article (3), the Minister may vest the Authority with such other

supervisory and executive powers, and may impose on the Authority

such conditions, obligations and restrictions as to him may seem

necessary for the proper and fruitful establishment, development,

maintenance, operation, management, control and conservation of

Free Zones.

Without prejudice to the generality of the powers conferred

upon the Authority by this Act, the Authority may

(a) do all such acts as may be necessary or conducive to

the attainment of the objectives, duties and obligations thereof;

(b) enter into discussions and agreements with

undertakings that seek to be authorised to operate within a Free

Zone, in accordance with the provisions of article 5;

(c)

acquire, sell or otherwise dispose of, or allocate by

title of lease, concession or other title valid at law, or otherwise

make available for use, areas, spaces, warehouses, factories,

wharves, and any other property, facility or structure which may

be available in the territory designated as a Free Zone, as well as

plant, machinery and equipment as the case may be, on such

terms and subject to such conditions as the Authority

determines appropriate, so however that, in all cases, such terms

and conditions shall be established in accordance with market

rates

Provided that the Authority may, with the approval

of the Minister, create servitudes and other similar rights over

areas comprised within a Free Zone in favour of any land

outside the Free Zone whenever such rights are required for the

proper use of such land;

(d) manage and develop land, carry out works thereon

and maintain works or assist in their maintenance;

(e)

authorise the carrying on of any activity within a

Free Zone;

(f)

impose restrictions or prohibitions on the activities

that may be carried out by authorised undertakings, having

regard among others to the nature of the particular goods or

services, the requirements of customs supervision or security

and safety considerations;

(g) exercise, perform, and discharge all such powers,

duties and functions as are by or under this Act vested in or

assigned or delegated to the Authority in respect of a Free Zone

and which are not reserved for the Commissioner in terms of the

Import Duties Act and the Union Customs Code;

(h) determine the rents, charges, dues and other levies to

be paid in or in connection with any aspect of any Free Zone or

the services and facilities made available thereunder, which

dues and levies shall be established in accordance with market

rates, including, among others, fees relative to the authorisation

of undertakings to operate within a Free Zone;

(i)

issue and publish guidelines from time to time to

make rules on any matter falling within its authority in terms of

this Act or any regulations issued thereunder, and not reserved

for the Commissioner in terms of the Import Duties Act and the Cap. 337.

Union Customs Code;

(j)

do all such other acts as are incidental to or

consequential upon the exercise, performance and discharge of

its powers, duties, and functions under this Act.

(1) The Authority shall, not later than six months after Accountability

the end of each calendar year, make and transmit to the Minister a of the Authority.

report dealing generally with the activities thereof during the previous

year and containing such information relating to the proceedings and

policy of the Authority as the Minister may, from time to time,

require. The Minister shall cause a copy of every such report to be

laid on the Table of the House of Representatives as soon as

practicable.

(2) The Authority shall afford to the Minister and to the

Minister responsible for finance, full facilities for obtaining

information with respect to its property and activities, and shall

furnish them with returns, accounts and other information with

respect thereto, and afford them facilities for the verification of the

information so furnished in such manner and at such times as the

Minister may request.

(3) The Authority shall furnish to the Commissioner such

information and documentation as may be reasonably requested by

the Commissioner in carrying out his functions, duties and

responsibilities in terms of the Import Duties Act and the Union Cap. 337.

Customs Code.

Where the Authority is satisfied that, in the case of an

undertaking determined as authorised to operate in a Free Zone, it

would be consistent with the aims and objectives of the policy under

which that Free Zone was constituted to do so, the Authority may

provide for the undertaking, industrial buildings, structures and land

owned directly or indirectly by the Government in a Free Zone,

including, on such terms as may be agreed, industrial buildings and

structures constructed or altered according to the requirements of the

relative undertaking and this for a term which shall not extend beyond

the term of the determination (original or extended) issued to the

undertaking authorising it to carry on activities within the particular

Free Zone. The provision of such buildings, structures and land shall

take place subject to such charges as the Authority may determine, so

however that in all cases such charges shall be established in

accordance with market rates.

PART IV

Authorised Undertakings and Permitted Activities

(1) Undertakings shall only carry out in a Free Zone a

trade or business being principally -

(a) the production or manufacturing of any goods,

materials, commodities, equipment, plant or machinery;

(b) the assembly, testing, repair and, or maintenance of

any goods, materials, commodities, equipment, plant or

machinery;

(c)

the labelling, packaging, sorting, dividing,

warehousing, storage, exhibition, assembly and related

activities of or relative to any goods, materials, commodities,

equipment, plant or machinery, including where such goods are

acquired in bulk and are to be processed within a Free Zone in

preparation for their eventual sale or distribution;

(d) any activity involving the provision of services

relative to or concerning logistics as may be approved by the

Authority;

(e)

the carrying out of any activities as may be approved

by the Authority during such time as goods are being held in a

Free Zone or in preparation for their eventual transhipment;

(f)

any activity concerned solely with the conduct of a

Free Zone including, but not limited to, stevedoring, wharfage,

operation of terminals and container handling;

(g) the rendering of services analogous or

complementary to the activities referred to in the above

paragraphs; and

(h) the carrying out of such industrial, commercial or

service activity as may be prescribed by the Authority through

guidelines issued thereby; and the status as an authorised

undertaking shall be evidenced by the issue of a document for

this purpose. The granting of the status of authorised

undertaking to any undertaking shall be notified by the

Authority to the Commissioner as soon as such status is

approved and in any case prior to commencement of operations

by the authorised undertaking.

(2) No undertaking shall be granted an authorisation

contemplated by this Act unless its activities are, in the opinion of the

Authority, wholly or mainly carried on or exercised within a Free

Zone.

(3) For the purpose of sub-article (2), the following activities

carried on or exercised outside a Free Zone by an authorised

undertaking shall not be deemed to infringe the rule therein set out

(a) the management and administration of an

undertaking, its trade, business or property and the holding

thereof;

(b) the execution of instruments, transactions,

negotiations or agreements relative to an undertaking’s trade or

business;

(c)

the transit of goods or their commodities to and from

a Free Zone.

(1) The Authority shall revoke the determination of any Undertaking

undertaking authorised to operate therein, which carries on any ceasing

authorised

activity, or has income accruing to it or derived by it, which consists undertaking

illegal activities.

of, or originates from any transaction, operation or other activity

which is a criminal offence under the laws of Malta, or would be such

an offence if carried out in Malta, or has received or has in its

possession or control money or other property the receipt, ownership,

possession or control of which is, or would be, such an offence as

aforesaid.

(2) Without prejudice to the application of any other law on

the subject, all income, money or other property as is referred to in

sub-article (1) shall be liable to seizure and shall be forfeited in

favour of the Government and become its property absolutely.

Subject to the provisions of the Union Customs Code, in

issuing determinations for operations in a Free Zone, the Authority

shall

(a) have power to impose such prohibitions or

restrictions on grounds of public interest, public morality, public

policy or public security, the protection of human, animal or

plant health and life, the protection of national treasures of

artistic, historic or archaeological value, or the protection of

industrial or commercial property;

(b) have power to require that goods which are

dangerous or likely to spoil other goods or which, for any other

reason whatsoever, require special facilities, be placed in

premises specially equipped to receive them.

(1) No determination shall be issued to any undertaking

if the applicant undertaking is, in the opinion of the Authority,

engaged in any operations connected with such commodities as the

Authority may from time to time determine through the issue of

guidelines.

(2) No determination shall be issued to any undertaking unless

the said undertaking is occupying, under any title valid at law, or is

being allowed by the Authority to make use of immovable property in

a Free Zone whether on its own or in conjunction with other

authorised undertakings.

(3) The Authority may, with the concurrence of the

Commissioner, permit any person whomsoever to have access to and

operate in a Free Zone, even if such person cannot, for any reason

whatsoever, be an authorised undertaking if, in the opinion of the

Authority it would be useful, necessary or conducive to the better

development or functioning of a Free Zone that such person be

granted such access and be allowed to operate in the Free Zone.

The Authority may from time to time release certificates as

it may deem appropriate attesting that an undertaking, or an

undertaking in the process of formation, is, or will be, a determined

undertaking within a Free Zone, and such certificate shall be

conclusive evidence for all purposes of this Act, and for all related,

corollary or ancillary matters, to the effect that the said undertaking

is, or will be, so authorised.

PART V

Power to make Regulations and to issue Guidelines

(1) Without prejudice to the applicable provisions of the Power to make

Import Duties Act and of the Union Customs Code and of any rights regulations.

of the Minister responsible for Customs and of the Commissioner

thereunder, in order to achieve the purposes of this Act, the Minister

may, in terms of this Act, make regulations to give effect to the

provisions hereof and, without prejudice to the generality of the

foregoing, such regulations may include provisions with respect to

(a) the establishment of policies for implementation by

the Authority as to the undertakings eligible to be authorised to

carry out activities within a Free Zone, to benefit from any

incentives and other arrangements, the types of incentives, the

range of support and other related matters;

(b)

the introduction of measures of a fiscal nature;

(c)

the introduction of such other support measures as

are considered appropriate and subject to such conditions as the

Minister may deem fit, which measures may include, but shall

not be limited to, the measures provided for in article 4(3);

(d) the making of such provisions relative to the

structure,

management,

functions,

powers,

duties,

accountability, operations or any other matter as he may deem

fit, relative to the Authority, to any person designated to act as

such as well as its personnel, assets, liabilities or otherwise;

(e)

the definition and interpretation of terms and

concepts to be used in regulations and guidelines;

(f)

the deletion or the transposition of any provisions in

the relevant legislation into regulations with such modifications

as the Minister may consider appropriate or necessary.

(2) Where the Minister proposes to make or modify

regulations in accordance with the provisions of this Act and those

regulations provide that an undertaking may benefit from any

measures of a fiscal nature as set out in sub-article (1), the power of

the Minister to make such regulations shall only be exercised with the

concurrence of the Minister responsible for finance.

(3) Where the Minister proposes to make or modify

regulations which provide for the granting of any assistance, a copy

of such proposed regulations shall be forwarded to the State Aid

Monitoring Board which shall communicate its opinions on the

proposed assistance in accordance with applicable law.

(1) For the better carrying out of the provisions of this

Act, the Authority may, in furtherance of any of its functions and

powers, from time to time

(a)

issue and publish guidelines to establish inter alia

(i) the terms and conditions of any arrangements,

incentives or schemes including the determination of rules

for the eligibility of undertakings to any benefits and

incentives under any such schemes and all matters related

and ancillary thereto;

(ii) the applicability of such schemes to particular

projects or undertakings; and

(iii) any additional requirements and conditions in

relation to activities of undertakings, the conduct of their

business, their responsibilities to the Authority, reporting

requirements to the Authority, financial resources and

related requirements, and any other matters as the

Authority may consider appropriate;

(b) pursuant to a delegation by the Minister by means of

a relevant regulation, transpose any provisions in the relevant

legislation into guidelines with such modifications as the

Minister or the Authority, as the case may be, may consider

appropriate or necessary.

(2) Guidelines shall be binding on all authorised undertakings

and on other persons as may be specified therein in accordance with

their terms.

(3) Where any guidelines deal with measures of a fiscal

nature, the concurrence of the Minister responsible for finance shall

also be required.

(4) Except for any new guidelines or amendments to the

guidelines which are purely administrative in nature, and are

expressly declared to be so by the Authority, which come into force

immediately upon the posting thereof on the official website of the

Authority, amendments to existing guidelines shall come into force

on the lapse of fifteen days after they are posted on the official

website of the Authority or on such later date as may be stated

therein

Provided that an amendment to any guidelines may not

reduce, withdraw or cancel any benefit previously granted except in

accordance with the terms of this Act or a regulation in terms of

which it is issued.

(5) Where the Authority proposes to issue or amend

guidelines, which provide for the granting of any new or increased

assistance, a copy of such proposed guidelines or amendments thereto

as the case may be, shall be forwarded to the State Aid Monitoring

Board, which shall communicate its opinions on the proposed

assistance in accordance with applicable law.

(1) Notwithstanding any provisions of the Income Tax Various

Act or of any other law, incentives, benefits and grants in terms of miscellaneous

provisions.

schemes that may be made applicable by the Authority to give effect Cap. 123.

to this Act, shall be exempt from tax in the hands of the relevant

beneficiary, provided that such aid does not take the form of income

substitution.

(2) The Minister may make regulations to lay down the

conditions relating to accounting, record keeping and reporting to the

Authority for the enjoyment of the incentives, benefits and grants laid

down in sub-article (1).

(3) Where any benefit provided by this Act or by regulations

made thereunder is due to a partnership or other undertaking and, in

accordance with the Income Tax Act or any other applicable law, the Cap. 123.

partners or members thereof and not the partnership or undertaking

itself are assessable to tax on any income of such partnership or

undertaking, any benefit provided in terms of this Act to a partnership

or undertaking shall be due to the partners or members of any such

partnership or undertaking.

PART VI

General Provisions

The provisions of this Act and of any regulations or Supremacy of

guidelines issued thereunder shall be interpreted in the light of European

legislation.

applicable European Union legislation regulating State Aid and

related matters and no person shall receive any benefit in terms of this

Act and of any regulations or guidelines issued thereunder which

exceeds those allowed in terms of such European Union legislation.

The provisions of articles 28 to 37, both inclusive, of the Applicability of

Malta Enterprise Act shall apply mutatis mutandis in the context of certain

provisions of

the provisions of this Act, so however that references in those articles the

Enterprise Act.

to "the Corporation" shall be interpreted in the context of this Act as Cap. 463.

being references to "the Authority".

Passed by the House of Representatives at Sitting No. 229 of the

29th May, 2019.

ANĠLU FARRUGIA

Speaker

RAYMOND SCICLUNA

Clerk of the House of Representatives

€1.44