This is the 14th update on COVID-19 related measures.
1. International News
1.1 Eurogroup’s Report on the comprehensive economic policy response to the COVID-19 pandemic
On 9th April 2020, the Eurogroup have issued a report outlining a comprehensive and coordinated economic response to the COVID-19 pandemic. The report addresses:
- the coordinated actions taken so far at the level of the Member States, the EU and the euro area; and
- additional crisis response instruments and measures to support the economic recovery.
Further information on this report may be accessed on the following link: https://www.consilium.europa.eu/en/press/press-releases/2020/04/09/report-on-the-comprehensive-economic-policy-response-to-the-covid-19-pandemic/
2. Legal Notices
2.1 Legal Notice 141 of 2020 (General Provisions applying to the Suspension of Legal and Judicial Times Regulations, 2020)
Through this Legal Notice, the Minister responsible for justice has suspended the running of any time period:
- under any substantive or procedural law, including any period of prescription and any peremptory period;
- decreed or otherwise ordered by any court, government department, government agency or public authority; and
- established in any agreement (whether a private writing or a public deed), including any time period for the performance of any obligation set out in such agreement, if any to the extent that the closure of the courts has a direct effect on the ability of any party to exercise its rights or to perform its obligations in terms of the same agreement.
Time periods suspended in accordance with (a) and (b) shall remain so suspended until 7 days, and those suspended in accordance with (c) shall remain suspended until the 20th day, following the lifting of the order of the closure of the courts by the Superintendent of Public Health and shall thereafter continue to run.
The Legal Notice clarifies that the suspension applies to each of the following:
- the running of all the legal periods imposed on a notary public by law to register any deed, will, act or private writing; or
- the running of any period within which a notary public, in terms of any applicable law, must pay taxes collected by him in the exercise of his profession; or
- the running of any time period related to fiscal benefits, incentives or exemptions;
- the running of any time period within which a notary public is to submit any information or documentation to any authority or regulator pursuant to relevant notarial activity; and
- the running of time with respect to the performance of any obligation contained in any deed or private writing, including a registered promise of sale agreement and the running of time with respect to the expiration of any registered promise of sale agreement.
2.2 Legal Notice 142 of 2020 (Moratorium on Credit Facilities in Exceptional Circumstances Regulations, 2020) and Directive No. 18 issued by the Central Bank of Malta
This Legal Notice regulates the provision by credit and financial institutions of a moratorium on credit facilities, to support economically vulnerable persons who have been materially affected by the COVID-19 outbreak.
It provides that credit institutions licensed by the MFSA under the Banking Act and financial institutions under the Financial Institutions Act shall grant a moratorium of 6 months on capital and interest unless the borrower decides to continue to pay the relevant interest. This requirement to grant a moratorium shall be applicable to all credit facilities satisfying the eligibility criteria established under a directive issued by the Central Bank, with the exception of credit facilities to other credit and financial institutions.
Administrative penalties may be imposed on credit or financial institutions which fail to comply with these regulations or directives issued thereunder.
Directive No. 18 (Regulation on Moratoria on Credit Facilities in Exceptional Circumstances), issued by the Central Bank of Malta on 13 April 2020, provides that all retail and non-retail clients including non-financial corporates, micro, small and medium sized enterprises, self-employed, persons in employment and households, with a credit facility who were not in arrears and were meeting fully their commitments prior to 1 March 2020 are eligible applicants. In order to be eligible for the moratorium:
- these persons must meet the following criteria:
- not be in a forbearance arrangement or, if it is the case, have met all terms and conditions agreed upon with their credit or financial institutions;
- not be in arrears with the repayment of their credit facility;
- there persons must be able to prove, based on sufficient evidence acceptable to their respective credit or financial institution, that their income has been or will be materially affected by the COVID-19 outbreak in such a way that adheres to the credit facility repayment commitment of both capital and/or interest in part or in full is temporarily materially impaired.
The Directive further clarified that:
- the application of the moratorium is on a voluntary basis and those persons who wish to benefit from the moratorium must submit their application to the respective credit or financial institutions, at any time until 30 June 2020 or any later date as determined by the Minister for Health in consultation with the Minister for Finance and Financial Services;
- credit and financial institutions shall take all necessary measures to inform applicants on the decision on the application for the moratorium within 10 working days; and
- the six-month moratoria will start with effect from the date of approval of the application by the relevant institution.
Further information on these regulations may be accessed on the following link: https://www.centralbankmalta.org/en/news/79/2020/8800
2.3 Legal Notice 143 of 2020 (Issue and Validity of Identity Cards (Amendment) Regulations, 2020)
This Legal Notice provides that identity cards issued after the 12th February 2014, whose identifying number contains any of the letters ‘B’, ‘G’, ‘H’, ‘L’, ‘M’, ‘P’ and ‘Z’, which expire before the 30th June 2020, shall remain valid until the 30th June 2020 or until such other date as the Prime Minister may by regulations establish.
3. Administrative Notices
3.1 Press Release: Department of Employment and Industrial Relations (DEIR) to provide services online or through telephone
As of 15th April 2020, the DEIR’s offices in Valletta will be closed to the public. The DEIR will continue to provide its services through telephone or online.
3.2 Press Release: Helpline launched for foreign nationals who wish to be repatriated
The Ministry for Foreign and European Affairs has launched a helpline and email address for all foreign nationals who require assistance in repatriation.
Assistance is available to all European Union citizens and third-country nationals who have been staying in Malta for different purposes such as employment, education and family reasons, among others. Foreign individuals who are not in possession of a residence document are also entitled to assistance.
3.3 Press Release: Payments for COVID-19 Wage Supplement, Quarantine Leave and Telework will start being issued this week
A press release issued by the Ministry for the Economy, Investment and Small Businesses provides that the Covid-19 Wage Supplement Payments covering the months of March and April, the Quarantine Leave Payment and the Telework Scheme Incentive are expected to start being disbursed as from this week.
3.4 Press Release from the Chamber of Advocates
On 9 April 2020, the Chamber of Advocates published a clarification note relating to Legal Notice 137 of 2020 - Code of Organization and Civil Procedure (Amendment of Schedule A) Regulations, 2020. The Chamber of Advocates explained that by virtue of L.N. 137 published on the 3 April 2020, the Minister responsible for Justice, has amended the Tariffs applicable for the opening of the registry of the courts in certain instances. The Chamber clarified that L.N. 137 simply revises the fees that are payable to the registry if one were to open the registry outside normal business hours, only in the case of the matters captured by paragraph 1 (a) and (c) of Tariff A, as repeated in each of Tariffs B and D. To avoid misunderstandings, the Chamber explained that the registry remains subject to an order of closure, as are the courts. L.N. 137 does not change that current state of affairs, accordingly the registry of the courts can only be opened if the matter is considered to satisfy the requirements of urgency or the public interest as required by Subsidiary legislation 465.17, with the difference that in the cases mentioned in the LN, the cost for opening of the registry is being reduced in view of the nature of most of those cases.
The Chamber went on to explain that this does not mean and indeed should not be construed as meaning that for all the cases mentioned in paragraph 1(a) and (c) of Tariff A, the registry is open, it is not. Indeed, there are some cases which are captured by the LN that can, of their nature, hardly be considered as urgent, whilst others, such as certain issues in child custody, for instance, are of their very nature urgent. It is the court that will in each case determine whether the matter is one of urgency or otherwise. The Chamber advised Advocates to exercise extreme care in applying the provisions of this latest legal notice and should apply it in the manner in which it is intended, namely that it still regulates a situation where the court registry is closed and can only be opened for urgent cases or where the public interest deserves it – in these cases only the registry fees for the matters captured by paragraph 1(a) to (c) will be the reduced fees.
3.5 Proposals made by the Malta Institute of Accountants
According to a notice sent by the Institute to its members, the Malta Institute of Accountants attended a virtual meeting with the Parliamentary Secretary for Financial Services and Digital Economy and the Commissioner for Revenue. A number of proposals were put forward during this meeting, as follows:
- that payment of entire provisional tax for basis year 2020 is deferred to 31 December 2020 and is based entirely on 2020 income;
- that payment of settlement tax, 15% tax on rental income and part-time work for basis year 2019 is deferred to 31 December 2020;
- that payment of FSS, SSC and MLF due from March 2020 onwards is deferred to 31 December 2020;
- that payment of SSC by self-employed persons is deferred to 31 December 2020;
- that carryback of tax losses anticipated in basis year 2020 against income tax due for basis year 2019 is made possible, giving rise to non-payment of such 2019 settlement tax;
- that unused capital allowances during basis years 2019 and 2020 may be claimed against any source of income and subjected to group relief;
- that entities which are deemed by Malta Enterprise to be within the critical list be entitled to transform losses incurred in basis years 2019 and 2020 into cash grants;
- that VAT payments due from March 2020 onwards are deferred to 31 December 2020;
- that all VAT refunds due are released irrespective of any credit controls or other ongoing investigations;
- that VAT is declared/claimed on a cash basis;
- that there is an immediate revision of the VAT bad debt guidelines and an alignment of the same to those under the Income Tax Act;
- that credits for input tax are carried backwards to previous tax periods, not only forward, thus effectively giving rise to refunds;
- that all tax return filing deadlines are postponed by a minimum of 2 months from the normal deadline;
- that the €800 wage supplement is declared as a post-tax adjustment such that it does not attract income tax or SSC;
- that the minimum SSC contributions for employers, employees and self-employed persons are reduced on a pro-rata basis in the case of people to whom the €800 wage supplement is granted i.e. minimum SSC is calculated on the basis of a basic gross salary of €400 per month;
- that in the case of employers who agree with unions and DIER that the additional €400 is not paid by the employer or for low-income earners who only earn €800 per month, SSC of employer and employee should be waived entirely, but still credited to the respective employee's fund; and
- that there is a total waiver of MLF contributions otherwise due for the months of March to June.