The Statute of the Malta Chamber of Commerce, Enterprise and Industry was approved in 2008, and last amended on 21st May 2009. It includes, among other matters, procedures regarding the establishment and functions of the organisation, membership, governance, elections, economic groups and business sections, disciplinary procedures and resolution of conflicts.
Voting Rights and Procedures
An Electoral Commission is in charge of the conduct of the elections of the Executive Boards of the Economic Groups and Council elections.
Elections are held every two (2) years on the day fixed for the Annual General Meeting and run for two (2) consecutive business days thereafter.
All Individual Members are eligible to vote at the elections of the Executive Boards of Economic Groups and Council elections provided that:
(i) such Individual Members are Members of the Malta Chamber as at 31 December of the year immediately preceding the year in which the elections of the Executive Boards of the Economic Groups and Council elections shall be held;
(ii) such Individual Members have paid the subscription due for the year immediately preceding the year in which the elections of the Executive Boards of the Economic Groups and Council elections shall be held;
(iii) such Individual Members shall be eligible to vote within the Economic Group to which such Individual Member belonged as at 31 December of the year immediately preceding the year in which the Economic Groups and Council elections are held.
Election to Council are held by secret ballot and voting by proxy is prohibited.
Declaration of Poll
The six Members from any Economic Group with the highest number of votes in that Economic Group are declared to have been elected to the Council and form the Executive Board of that Economic Group. In the event of a parity of votes the candidate to be elected are decided by the drawing of lots.
To download the Statute document, please click here.
The Malta Chamber followed closely a number of issues and in some cases also formulated position papers. The Malta Chamber has constantly been at the forefront of discussions when the national interest was brought to the fore.
Banking of Hours
After years of active representations on the issue, the Malta Chamber welcomed the publication of LN 46 providing for the introduction of Banking of Hours across the board. The Malta Chamber deemed this as a significant step in safeguarding Malta’s competitiveness, particularly through labour flexibility.
As the Malta Chamber often stated, flexibility must be Malta’s main driver for success in the current international climate. The concept was straightforward and allowed for extra hours worked during peak periods to compensate for times when workers were idle due to leaner demand. The LN set a calendar year as a reference period and gave the possibility of both parties agreeing to carry over balances from one year to the next. The Malta Chamber was also pleased to see that the necessary safeguards were put into place to ensure fairness and flexibility.
The Malta Chamber was confident that banking of hours would also serve the country well in a broader sense beyond competitiveness. It could also enable easier planning ahead for both the employer and the employee. In so doing, it could serve as a family-friendly measure because it contributes towards the improvement of the work-life balance of people who work in sectors that experience significant peak and off-peak differences in demand.
Within the current international climate, more flexible work practices are essential to ensure the further competitiveness and flexibility of businesses and the economy. The Malta Chamber firmly believed that this Legal Notice was a step in the right direction towards this aim.
Quotas for women on company boards
The Malta Chamber concurred with the Maltese Government’s decision to oppose plans by the European Commission to impose a 40 per cent quota for female board representation on publicly listed companies by 2020. The Malta Chamber believes that merit, experience and achievement should be the most important qualifications for any post, and most definitely not gender.
The Malta Chamber recognised the importance of the contribution of women in the business world, however, it reiterated its position that quotas do not adequately address the need to improve gender balance on boards. Measures to impose a standard scenario in Europe as a whole may not apply to Malta due to cultural issues and the availability of support structures for professional mothers.
Furthermore, with quotas taking precedence over competences, females may be given jobs on the basis of gender rather than academic qualifications and merit. The ideal approach would be to implement measures which encourage a natural rise in the number of women at decision-making level, including incentives for females to retain their employment and help strike a balance between work and family commitments.
In a letter to the Permanent Secretary for Tourism, Culture and Sustainable Development, the Malta Chamber registered the complaints of a number of members who have been chosen to undergo verification by the Approving Body.
The Malta Chamber disapproved of this process for a number of reasons, firstly because these audits were being carried out in an overzealous way after so many years, where the eco-contribution matter was being mismanaged by the authorities and as a result of which these law-abiding companies paid eco-contribution on top of private waste packaging schemes. In the process they were subjected to unfair competition from operators which did not abide by the same environmental and other obligations. In this regard, the refunds due to these companies, at law, remain unpaid.
The Malta Chamber believed that this would create not only an administrative burden but in many instances a financial one since these operators have to open every item they sell which fall under this category and show it to the same auditors.
Better regulation vital for competitiveness
The Malta Chamber noted with satisfaction the commencement of a consultation process on proposed amendments of commercial licenses regulations, announced by the Ministry for Fair Competition, SMEs and Consumers, Hon. Jason Azzopardi.
The Malta Chamber had been following this matter closely in recent weeks within its efforts in the area of better regulation. In this regard, it had for a number of years been making strong representations to reduce administrative burdens on businesses, particularly SMEs who are the worst affected by red tape. The Malta Chamber reiterated its position for a more transparent and efficient process, which would save time and reduce costs for business.
The Malta Chamber hoped that any legislative change or administrative burden reduction would be trickled down to clients facing staff in Government entities, to ensure a smooth transition to more efficient practices. The Malta Chamber would be participating in this consultation on behalf of its members and augured that Government will be in a position to continue to simplify regulations and reduce administrative burdens for businesses.
Waste Management (Packaging and Packaging Waste) (Amendment) Regulations
The Malta Chamber wrote to MEPA about the proposed amendments to Waste Management (Packaging and Packaging Waste) Regulations. The Malta Chamber expressed its concerns on the way the consultation was carried out and the tight deadline given to reply, and it requested an extension to the deadline to submit meaningful recommendations. The proposed amendments aim at ensuring compliance with Directive 94/62/EC of 20 December 1994 on packaging and packaging waste, as amended by a number of EU directives.
The main change included in this proposed amendment is regulation 5(2) which stipulated that producers whose packaging ends up at final consumers would be obliged to join an authorised packaging waste recovery scheme. Other amendments include an extension to the time frames by which producers register as a producer of packaging and other administrative formalities directed towards waste management schemes.
The Malta Chamber showed its concern on the proposed amendments which were going to impact negatively on companies which are currently self-complying to the requirements of the law.
The Malta Chamber submitted its proposals for the 2013 budget to the Minister of Finance, Economy and Investment, Tonio Fenech. The document made 31 practical recommendations in terms of utility costs, COLA, public sector bureaucracy, family-friendly measures and a shift from direct to environment taxation. It also includes sectoral recommendations featuring manufacturing, tourism, construction and real estate, ICT, digital gaming and yachting.
Feedback on Environmental Permitting
The Malta Chamber recognises that the regulations on Environmental Permitting for Industry may have negative consequences on some sectors which are represented by its Members. For this reason, a Sub-group chaired by Board of Management member Anton Borg was formed in order to focus on this issue and address the Members’ points of concern in a counter proposal.
Following a presentation delivered by MEPA officials on the consultation document, a number of sub-group meetings were held, during which, the Members present put forward their queries and expressed their concern about this reform.
Feedback on the Government’s Post-Consultation Pensions Document
The Malta Chamber studied the updated post-consultation strategic review of Malta’s pension system and the recommendations made by the European commission in its white paper. It deems the study a good basis for reform but insists for the urgent publication of a final blueprint with clear time-frames to ensure further progress in the reform. The blueprint must contain all necessary information in order to ensure that business and other stakeholders are in a position to plan adequately. The recommendations made in past studies and position of the Malta Chamber, are still valid to this day and should be seriously considered in the light of the present reform. It is also noteworthy to see that European Commission’s recommendations are generally in line with the Malta Chamber’s position.
The Malta Chamber reiterated that the sustainability of our pensions system is beyond debate stage and requires the country’s full and constant focus. As a realistic and responsible organisation, the Malta Chamber understands the urgency of the situation and the grave repercussion of the delay in implementing further reform.
In designing the necessary reform, policy-makers must ascertain two crucial factors in ensuring balance between the country’s economic and social needs. All stakeholders need a blue-print with clear time-frames and all relevant information in order to be in a position to plan adequately for the future. It is also important that the matter is tackled holistically in line with other social and economic policy considerations such as those related to health, wage indexation and education amongst others. Besides, whilst the reform is underway, stakeholders do not expect conflicting decisions to be taken, such as policies facilitating early retirement in the public sector.
The Malta Chamber made its views on pension reform amply clear and now awaits progress to the reform with the least shocks possible to the country’s socio-economic balance.
‘Tourism Policy for the Maltese Islands 2012 – 2016’ Recommendations
The Malta Chamber sought to step up its efforts in the tourism field by encouraging a wide and active participation of representatives in those sectors which complement hotels and catering establishments. For the purpose of drawing up this position paper it has sought the views of its members operating not merely in the hospitality sector but in wider areas such as English language schools, destination management companies (DMCs), car hire companies, airlines, operators of entertainment establishments, travel agents and the major transport and logistics hubs on the island.
In view of the above, the Malta Chamber strongly agrees with the current practice of reviewing the national Tourism Policy at regular intervals in line with ongoing developments that affect growth in the sector. This enables the country to meet new challenges effectively.
The Malta Chamber further believes that Malta must take more direct control of its brand, its story and message. It must leverage on its unique selling proposition, combining these intelligently into the various niches in which it is established or new ones it is seeking to penetrate.
It also agrees with the authorities’ priority of trying to attract more tourists during the shoulder and winter months. Therefore, it fails to understand how the Strategy document ignores certain important segments which satisfy the need to attract value-added tourism during the low season. A case in point is the fact that there is no mention of the yachting industry, as well as sports activities such as golf.
The Malta Chamber agrees with the reasoning given in the strategy that the country needs to have the right mix of airlines, such as legacy carriers, low-cost and charter operators, to improve accessibility to new emerging markets such as the BRIC countries. Coupled to this, strong action needs to be taken in relation to the Visa requirements for tourists coming from these markets.
In conclusion, the Malta Chamber concluded that the authorities must do extensive lobbying with the European Commission to make it understand the importance of Air Malta’s future to the Island’s economy and that European state aid rules should be made flexible whilst the restructuring process is being carried out.
Budget 2013 Reactions
The Malta Chamber noted the underlining priorities behind the 2013 Budget as being fiscal consolidation and job creation. It fully supported these objectives and was encouraged by the fact that the 2013 Budget did not create economic shocks namely through increases in tax and utility rates.
On the contrary, the announced reduction in income tax rates was in line with the Malta Chamber’s consistent requests for reduced tax burdens in the economy. These requests were made in the interest of both national competitiveness via lower pressure on wage demands and a boost in domestic disposable income.
The Malta Chamber also noted a number of measures aimed at enhancing the competitiveness of Malta’s major growth promoters that were addressed in the Budget Speech. Amongst these were Entrepreneurship, SMEs and Start-Ups, Manufacturing, Tourism, Property, Energy and Environment, Employment and Training.
Whilst the Malta Chamber identified itself with a number of measures announced in the Budget, there were a number of proposals it would also have liked to see included in the Speech. Primarily amongst these wass the missed opportunity to address the COLA formula, which is required to complement Malta’s competitiveness position whilst being retained as an instrument to compensate workers for loss of disposable income due to inflation.
The Malta Chamber would also have liked to see the introduction of a voluntary scheme for business whereby operators could choose between variable energy rates or opt to fix their tariffs for a number of months ahead at a reasonable premium. It would also have liked to see its proposal accepted for the re-introduction of export-credit insurance within the limitations imposed by EU regulations.
Pre-electoral proposals - 'Wealth Creation Before Wealth Distribution'
The Malta Chamber is mindful of the challenges which the international scenario will continue to place on the local economy. The financial instability in the euro area and the uprising in the Arab world are far from over and Malta must continue to adapt and adjust to these situations over the coming five-year period.
As a responsible constituted body and aware of the structural bottlenecks to growth that persist, the Malta Chamber called on political parties to avoid complacency and address the need for a holistic and effective approach to competitiveness to drive growth.
The Malta Chamber perceives (a) Growth and (b) Sustainable Public Finances as the key ingredients in ensuring a healthy socio-economic balance and a stable economic future for the country in the next legislature.
With this in mind, the Malta Chamber strongly advocated:
- The achievement of a Balanced Budget as targeted by 2015/16.
- Reduction of income tax burdens as announced in the 2013 Budget Speech to stimulate investment and growth as well as to discourage abuse
- Commissioning of the energy interconnector to safeguard stability of supply and lower costs
- Continued investment in alternative energy which will help reduce our dependency on imported fuel and energy
- Continuous investment in education and training to secure a qualified workforce
- An improved business environment within which the traditional economic sectors such as manufacturing, tourism, retail and trade, shipping and construction and real estate can continue to grow and create jobs
- Nurturing new growth promoters such as aviation, digital gaming, financial services and yachting. Whilst not entirely new, the Malta Chamber believes that, given the right strategic support, the latter two sectors continue to promise significant potential for expansion.
The Malta Chamber believed that the next election falls at a time which is of fundamental importance to the country. In line with the need to consolidate public finances and competitiveness levels, it reiterates its firm belief that the country’s political leaders must place wealth creation before wealth distribution.
Consequently, it appeals strongly to the political parties to refrain from making any unsustainable electoral promises and other statements that could jeopardize Malta’s international reputation and economic development in the longer-term. It also augured that the political parties engage in a mature political discussion and that the electoral campaign remains calm and respectful to ensure least disruption to the business momentum.
The Malta Chamber always worked well with all political parties because its only interest is that of promoting business and ensuring that Malta has a good business environment. In spite of the incredibly difficult international economic environment within which we are operating the results achieved so far are extremely good. The Chamber looks forward to improving these same results and in creating greater national wealth through private sector growth.
During 2011, the Malta Chamber followed closely a number of issues and in some cases also formulated position papers. The Malta Chamber has constantly been at the forefront of discussions when the national interest was brought to the fore.
With the beginning of civil unrest in Libya, Malta Chamber President, Tancred Tabone took the initiative to form an Action Committee from amongst Malta Chamber members operating in Libya. The purpose of this Committee was to advise the Malta Chamber in its representations on the Libyan crisis with Malta’s highest authorities. The Committee purposely kept a low profile despite its high key involvement.
The Malta Chamber was very active behind the scenes through research, ongoing communication with affected members and representations with the highest authorities. Through the Internationalisation database of members, the Malta Chamber was able to quickly identify and contact companies with business interests in Libya. At the same time, it publicly requested the authorities to set up a Task Force to help the country co-ordinate the necessary efforts.
Government took up the suggestion to form a Task Force, and the Malta Chamber was promptly invited to participate. Through this Task Force, the Malta Chamber continued to advise the authorities with the urgent business concerns being faced by its members in terms of contract obligations, business exposure, protection of property/investment, credit due, visas and similar issues.
At an EU level, the Malta Chamber also communicated its concerns through BusinessEurope and Eurochambres. Furthermore, in a letter to the President of the EU Commission, it emphasised the need to seek solutions with a European dimension. It emphasised that the crisis was not solely affecting Malta or the Mediterranean but was going to impact all EU countries.
On a humanitarian level, the Malta Chamber also held discussions with the World Health Organisation, for the latter to procure medicines from Malta for onward distribution to North Africa. WHO was looking into sourcing medical supplies from local suppliers. Naturally, this development gave rise to significant economic and business opportunities for the country.
The Malta Chamber has also voiced its concerns on the amounts due from Libya to private companies, stating that it was important for this issue to be seriously taken up by Government at the political level post-crisis. Internal research showed that unpaid invoices issued to the Libyan Government amount to €20.4 million, with another €11 owed from private companies. Works in progress and stocks amounted to €10 million.
The visa issue was also continuously emphasised, with the Malta Chamber insisting that Government needed to ensure that no unnecessary obstacles were placed on Maltese and Libyan businesspeople, in order to engage in trade and investment.
The Malta Chamber recommended the appointment of a Special Envoy for Libya Affairs. The Malta Chamber justified its recommendation, given the importance of Libyan Maltese socio-economic links and Malta’s need to co-ordinate efforts better with respect to Libya.
The Malta Chamber also recommended the importance of re-establishing flights to Libya. After a slight delay, Air Malta began operations to Tripoli.
The Libyan Action Committee also maintained regular contact with Dr. Joseph Pirotta, who had been appointed as the Maltese Government’s representative in Benghazi, as well as with Mr. Victor Camilleri after his appointment as Ambassador.
This year, the Malta Chamber Council formulated its recommendations for the Malta Chamber’s Pre-Budget position not solely in the light of the local economy but also the international situation. In this regard, the Malta Chamber stated that Malta’s growth prospects were threatened by the bleak international scenario which was undermining our growth rates, since the countries that comprise our highest export markets were imposing austerity measures. Furthermore, future prospects were further hampered by the fact that the prices of raw materials were also increasing. At the same time, Malta needed to address its own public finances.
In this situation, the Malta Chamber recommended that the prime objective of the forthcoming budget should be to ascertain the right environment for the private sector to generate economic growth. It insisted that private sector initiative would complement measures taken within the public sector to enhance efficiency. Both sectors needed to be aligned and mutually reinforcing in favour of economic stability and growth.
With growth in mind, the Malta Chamber formulated its position based on three pillars, that is, a holistic approach to competitiveness, wealth creation ahead of wealth distribution, and active measures to growth.
- Competitiveness and bottlenecks to growth: the Malta Chamber insisted that the way forward was a holistic approach to competitiveness, with remedial measures required to correct certain persisting bottlenecks to growth. These largely refer to unjustified increases in operating costs which included labour costs and utilities. Through a holistic approach, these costs must be seen not separately but as a whole, including the possible consequences of such measures.
- Sustainability and the Standard of Living: the Malta Chamber repeated its position to put wealth creation ahead of wealth distribution. It stated that the country need to continue to concentrate on maintaining and creating jobs at a sustainable rate in order to ensure that Malta can safeguard the standard of living and social security system that people had become accustomed to. The Malta Chamber insisted that in this budget, Malta’s public finances situation would be effectively addressed particularly though the strengthening of fiscal enforcement. Sustainability must not be achieved by further burdening the country’s productive sectors but through economic expansion and introducing further reform.
- Active Measures – by sector: once the various bottlenecks are removed, country can concentrated on its growth unshackled. In this regard, the Malta Chamber insisted that key traditional sectors in need of growth must be kick-started. Amongst its proposals regarding various sectors, the Malta Chamber referred to the construction industry, tourism and manufacturing as well as nurturing emerging sectors.
Post Budget Reaction
In light of the above, the Malta Chamber was encouraged by the fact that the 2012 Budget speech was aimed at promoting economic growth and consolidating public finances, without creating economic shocks, for instance, through taxes and utility rates. This was important in the light of the turbulent international realities. This was also in line with the objectives for the budget proposed by the Malta Chamber during consultations.
The Malta Chamber noted the positive measures aimed at enhancing the competitiveness of Malta’s major growth promoters, namely Small and Medium Enterprises, such as the Micro Invest Scheme providing tax credits and the MicroGuarantee scheme. In addition, an allocation of €14.2 million in incentives to industry was noted along with the announced upgrading of Bulebel and Hal Far Industrial zones, with an investment of €16.7 million and the investment of €30m on the BioMalta campus, in the pharmaceutical and life sciences sector.
The Malta Chamber commended the announced scheme allowing high-volume energy users to convert accumulated tax credits into grants to invest in solutions for energy saving and energy generation from renewable sources. In this regard, the Malta Chamber said it awaited the relevant ratios and further implementation details.
The Malta Chamber was disappointed with the manner in which the matter of maternity leave extension was raised abruptly during the final MCESD meeting preceding the Budget. The Malta Chamber stated that this proposal required serious evaluation as well as an in-depth discussion with all social partners prior to its implementation. A follow up meeting was set on the insistance of the Malta Chamber, where it once again stated its strong opposition to the extension.
The Malta Chamber registered its disappointment that the country wasted yet another opportunity to address the COLA formula. This was required to complement Malta’s competitiveness position whilst being retained as an instrument to compensate workers for loss of disposable income due to inflation. To this end, as a matter of priority, it continued to insist that the formula used for calculation of COLA incorporates a measure of productivity as had been already agreed within the pertinent MCESD working group.
Permanent Residency Scheme
Following the suspension of the Permanent Residency Scheme in December 2010, the Malta Chamber was very active in conveying its concerns through several representations as well as in the media. A Press Conference was held in March 2011 to support of the Real Estate Business Section. Th event was endorsed by the Federation of Estate Agents, The Malta Developers Association and Special Designated Areas.
The Malta Chamber stated that the Permanent Residency Scheme and the spill over effects on the economy was one of the major factors that kept the economy ticking along successfully - and this despite the turbulence caused by the global economic crisis. In 2010 alone 151 non-EU citizens purchased property in Malta at a value of over €35million, to the benefit of the furniture industry, builders, entertainment venues, and estate agents, amongst others. The tangible economic benefits were endless. Furthermore, while the Scheme was suspended, Malta’s competitors such as Cyprus and Portugal were all creating incentives to bring foreign investment their way.
The industry was informed that the Scheme had been suspended due to certain undesirable factors which the previous scheme allowed. These were linked to the low minimum rental obligation, as well as concern that holders of Permanent Residence would automatically become long term residents after five years in Malta. In this regard, the Real Estate Business Section was quick to offer its proposals, which government agreed would curb such abuse. The Section recommended:
- A looping system to restrict Permanent Residence holders from clocking the five years and becoming long term residents. Any tax incentives wouldbe lost if non-EU nationals apply for long term residence and moreover, their tax liability in Malta become more onerous.
- Permanent Residence holders would be obliged to possess a substantial health insurance cover.
- The low minimum rental obligation being immediately raised to €12k annually from the current €4150 p.a., in order to curb abuse.
The Business Section stated that considerable damage had been done to Malta’s reputation. The Malta Chamber insisted on the restoratation of this successful scheme as well as international confidence in our country as a serious destination and investment proposition.
Reaction to High Net Worth Individuals Scheme
Following ongoing representations and high level meetings with the authorities, Minister Tonio Fenech announced the introduction of the High Net Worth Individuals Scheme during a press conference held at the Malta Chamber, to replace the previous Permanent Residency Scheme.
The Real Estate Section within the Malta Chamber welcomed the introduction of this long overdue Scheme. Despite the fact that the Permanent Residence Scheme was not solely designed to sell property in Malta, it went a long way to incentivise overseas nationals to purchase property in Malta and stabilise the property market, generating millions of euro for both the private and the public sectors since its inception. Moreover, this occurred in a negative global economic climate and the fact that the property market in Malta remained relatively stable was a major contributor to the well being of the Maltese economy in turbulent times.
The Real Estate Section stated its serious reservations on certain thresholds that were introduced with the new Scheme as, in its view; these impinged on the attractiveness of Malta’s offering. The Business Section feared that the announced thresholds would have negative repercussions on the property market in general with a ripple effect on all other service providers, not only to the property industry but also local business in general.
Whilst appreciating that the introduction of certain measures were necessary, the Section expressed its apprehension that the new rules were too onerous. The Section also felt that the new cost of joining the Scheme was somewhat exorbitant.
Factory Rates and Service Charges
During the year under review, the Malta Chamber continued to escalate its efforts to resolve this serious issue affecting the manufacturing industry. In 2010 it was announced that factory rents and service charges in industrial zones that fall under Malta Industrial Parks would be increased substantially. Ongoing discussions with the concerned authorities have been based on the fact that increases in operating costs must be justified. Throughout its representations with the authorities the Malta Chamber has reiterated its stand that the increases, as suggested by the authorities would seriously affect competitiveness.
During the dialogue session held in June 2011 with the Prime Minister, both Malta Chamber President Mr. Tancred Tabone and the Manufacturing Economic Group (MEG) voiced their concern. During his intervention, Mr. Tabone stated that through ongoing discussions with the Minister of Finance and Malta Enterprise, the Malta Chamber was striving to arrive at a reasonable agreement for more acceptable rates. This positive intervention would hopefully be concluded in the interest of competitiveness in the manufacturing sector. Represented by Vice President Mr. William Wait, the MEG also pointed out the ever increasing costs for manufacturers, including the aforementioned service charges.
In his reply, the Prime Minister noted that a way forward was being discussed, keeping in mind to avoid shocks to the system. Dr. Gonzi also pointed out the problem of generating factory space for new companies that were interested in setting up in Malta.
In July 2011 the MEG held a second meeting with manufacturers, in order to gauge the problems being faced. During this meeting, there was a collective concern on the increased rent rates, as well as the way the service charge was going to operate. The meeting was opened and chaired by Mr. Tabone. During this very well attended meeting of around 100 manufacturers, MEG Chairman Mr. Matthias Fauser gave a brief outline of the ongoing efforts being made by the Malta Chamber in this regard, from September 2009 until the present day. This was followed by a letter to Minister Hon. Tonio Fenech and Malta Enterprise Executive Chairman, Mr. Alan Camilleri. Through the Malta Chamber’s lobbying efforts, Government lowered the service charge from €7 per square metre to €3.50 per square metre.
A third meeting was held in November with members, where Mr. Fauser provided an update of the situation and announced the names of the representatives of the Malta Chamber who would be participating in the two joint committees to be set up between ME/MIP and Malta Chamber. One Committee on Rents – would discuss and propose how the rents should be established, and another on the Service Charge – would review what was to be included under the said charge.
To date, the Rent and the Service Charge Committees met on a number of occasions and detailed discussions are still underway. As of end December 2011, discussions between the Malta Chamber and Malta Enterprise were still ongoing.
Furthermore, arising from this effort, the Malta Chamber is also actively encouraging tenants in the various industrial estates to form Tenants' Associations, namely those of Marsa, Kordin, Mriehel and San Gwann.
The Malta Chamber has drafted a number of reports amongst which a highly technical study entitled "Towards Sustainable Welfare Programmes and Pensions in Malta” which was endorsed by the Malta Hotels and Restaurants Association.
With reference to the consultation process undertaken this year, the Malta Chamber acknowledged the urgency of the situation given that the numbers did not add up. The Pay-As-You-Go (PAYG) system was unsustainable because the first tier adjustments were only short term measures. Therefore, this needed to be supplemented by a voluntary third pillar.
The Malta Chamber stated that the PAYG system gave limited manoeuvrability. However, it was pertinent to consider that part of the preceding reform already involved a number of difficult decisions, such as raising the retirement age to 65 years, raising the rate of contributions, as well as raising the pensionable income ceiling.
As an obligatory system, the Second Pillar could have serious social and economic implications. Because of this, the Malta Chamber stated that it was not in a position to consider this alternative for the time being. In order to consider the Second Pillar, the Malta Chamber would need further clarifications on how this system would be implemented.
The Malta Chamber said the system that should be seriously considered was the Third Pillar - voluntary pension schemes, that would be an addition to the current system. With the necessary safeguards, these schemes are positive because they tend to decrease the burden on our social security system and encourage the culture of saving amongst the public.
The Malta Chamber insisted that Government’s plans must be clear and published in good time, giving companies the time to plan and adapt to the reform’s changes. Proposals needed to be considered in the light of all the factors involved, such as health, education and income, in order to safeguard economic stability.
The Malta Chamber, through Deputy President Mr. Stefano Mallia, continued to participate in an MCESD Working Group focusing on COLA. The Malta Chamber’s stand on COLA had been well documented, with the organisation reiterating the importance of revising the COLA mechanism, to incorporate an element of productivity besides inflation. The European Commission has sounded a similar warning to Malta specifically on its system of wage indexation to inflation.
It was also proposed that the necessary disaggregated GDP data was made available without further delay to permit the calculation of COLA on a sectoral basis. This would ensure that COLA was in line with what a particular sector could afford.
Considerable headway was made during the group meetings, with unions and employers aggreeing on bold steps forward, most importantly incorporating GDP growth in the formula as a measure of productivity, besides inflation. A revision in the basic wage was also agreed.
Following the Budget Speech, the Malta Chamber expressed its disappointment that the country had wasted yet another opportunity to address the COLA formula. This was required to complement Malta’s competitiveness position whilst being retained as an instrument to compensate workers for loss of disposable income due to inflation. To this end, as a matter of priority, it continued to insist that the formula used for calculation of COLA incorporates a measure of productivity as has been already agreed within the pertinent MCESD working group.
In this regard, in spite of the productive outcomes arising from the MCESD Working Groups, the Malta Chamber is also disappointed that these recomendations were totally ignored.
Family Friendly Measures
Family Friendly Measures (FFMs) was another issue discussed within an MCESD Working Group, where the Malta Chamber took an active stand, contributing actively to a report prepared by the social partners on the issue. The Malta Chamber insisted that if FFMs were to be extended, they needed to be at best cost neutral to business. In this regard, a number of solutions were recommended.
The Malta Chamber stated that FFMs were efficient instruments, to help the economy grow by stimulating greater participation in the labour market and assisting firms in retaining valuable human resources, that would otherwise opt to work less or not at all. However, FFMs needed to be implemented with caution. It was stated that extending the scope of FFMs in business was a balancing act between achieving macro/micro gains and incurring losses in competitiveness due to business disruption and financial cost.
FFMs could not be viewed in isolation but within the framework of cost competitiveness, as an integral component of labour costs with pensions and COLA, amongst others. Authorities could not wrongly assume that business was always in a position to absorb further costs. Costs, irrespective of size, must always be justified.
The Malta Chamber insisted that nation-wide measures should precede those at enterprise level. National policy needed to place particular emphasis on measures that promoted FFMs that increased work and productivity and had a nation-wide effect. It strongly proposed that the authorities implemented extension of school hours, support to promote childcare centres and banking of hours on a wider scale. These measures would minimise the need for additional FFMs to be adopted at enterprise level and which would exert negative side effects on business. The Malta Chamber added that measures required at company level should remain at the discretion of business. It also proposed that Government provided appropriate incentives to the private sector to encourage take-up of voluntary measures. Fiscal and other incentives could fully or partially offset the costs incurred by business in the introduction of new FFMs.
Mr. Tancred Tabone and Mr. Kevin J. Borg also presented the Malta Chamber’s position to the Parliament’s Standing Committee on Family Affairs.
Following the announcement of a maternity leave extension during the 2012 Budget Speech, the Malta Chamber participated in a special MCESD meeting, where it made the necessary representations on behalf of private sector employers and SMEs.
During this meeting, the Malta Chamber complained at the manner in which the matter was handled whereby the MCESD was faced with a decision at its last meeting preceding the Budget with no apparent option but to accept. It also voiced disappointment at how social dialogue on the matter was further hindered by certain organisations choosing to discuss the matter in the media before doing so at the MCESD.
The Malta Chamber clarified that it was not opposed to the principle of maternity leave but against extending it further. It maintained that according to a study commissioned through the Malta Business Bureau, the benefits of extending maternity leave would be relatively marginal in comparison to the costs, especially because a significant extent of maternity leave was already available. This was substantiated by the fact that 60 per cent of women of child-bearing age are already in employment. Whether the extension could further increase female participation in this age bracket was questionable.
The Malta Chamber maintained throughout that there were far more effective measures to stimulate female participation than extending maternity leave. Besides being more effective, these alternative measures minimise costs and negative repercussions on business and the economy. The Malta Chamber expressed surprise at the measure because broad agreement to prioritise this nationwide approach as opposed to enterprise-specific measures was reached within the MCESD working group set up to discuss family-friendly measures.
The Malta Chamber expressed scepticism that workers were easily substitutable for temporary periods, especially in the case of highly-skilled workers and SMEs. In fact, this measure needed to be subjected to the “SME test” as required by the Small Business Act (Act XI 2011) and it was questionable whether it had been.
Extending maternity leave had both financial cost and disruption ramifications on business. In terms of the financial costs, strong concern was expressed that while the government announced it would be covering the increase in cost for the additional weeks beyond 14, this commitment was not binding in the future.
The Malta Chamber was further perturbed with the suggestion that employers should immediately pay the difference between the salary and the €160 allowance which the government promised to pay during the additional weeks of maternity leave.
Social partners were reminded that it was only in Malta that employers paid the full cost of maternity leave. In most European states, the cost of maternity leave payments were either paid by the government or shared through social security schemes.
In this context, the Malta Chamber questioned the drastic change in the government position on the matter since 2009 when this was being discussed at EU level. Then, the government foresaw considerable difficulties with the idea of extending the length of maternity leave by another four weeks due to the prevailing economic climate. It argued that, unfortunately, since then, the global economic climate had not ameliorated. Thus, any decision to go overboard with social measures that have not yet been implemented in competing countries would be ill-timed and not in Malta’s interest.
The Malta Chamber insisted on prioritising wealth creation before wealth distribution. The country cannot afford to depart from such important principles if it wants to safeguard its economy and the social welfare model it has managed to build for itself and from which we all benefit.
Europe 2020 Flagship Initiative – The Innovation Union
In 2011, the European Commission set out a flagship initiative entitled the Innovation Union, focusing on making Europe the centre of innovation as part of the Europe 2020 Strategy. The objective of this initiative was to keep the EU competitive on a global platform, by becoming a world-class science performer, with increased inter-coordinated innovation–driven partnerships, but with less bureaucratic procedures.
In a local context, the Innovation Union Scoreboard 2010 illustrated that Malta was a moderate innovator with a below average performance. In order to catch up, in its position paper the Malta Chamber stated that Malta’s focus on the innovation system needed to significantly increase in intensity, particularly in areas such as human resources, access to finance and hand-holding support, linkages to international markets and knowledge-based entrepreneurship.
The Malta Chamber emphasised that clustering initiatives were perhaps the most important policy development which should gradually be embarked upon in Malta. To date, the basic clustering efforts had been driven by the private sector. However, a more significant and sustained effort was needed to gradually create the necessary linkages between enterprises, academia, Government and private investors, with the aim to drive new ideas to market.
The EU needed to tackle unfavourable framework conditions and avoid fragmentation of effort. A broad concept of innovation must be pursued. The Malta Chamber emphasised that these challenges be addressed and overcome in a timely manner. Primarily it was essential to design and implement an enabling and integrated framework in all relevant policy areas.
Europe needed to improve its venture capital market by creating the appropriate equity-based incentives and by improving regulation. The Malta Chamber saw this as crucially important for Europe to be able to successfully transform its knowledge-base to commercial fruition.
Assessment of the Cost impact resulting in proposed increase of Landfill Fees
Prepared by the Energy and Environment Committee, with the assistance of the Malta Chamber Secretariat, this document refers to the consequences of the proposed increase, and makes a number of recommendations in this regard. Read more..
Abuse in Free Movement of Goods
Prepared by the Fast Moving Consumer Goods Working Group, with the assistance of the Malta Chamber Secretariat, the document reiterates the Malta Chamber's position on free trade, and the avoidance of protectionist measures, whilst also referring to market surveillance issues. Read more..
Updated Position on Working Time Directive
Prepared by the HR and Social Policy Committee, together with the assistance of the Malta Chamber Secretariat, the document adds to a previous position on the Working Time Directive, covering changing working patterns and a number or recommendations in this regard. Read more..
Report of the Malta Chamber the increase in Port Fees/Costs
Prepared by the Malta Chamber Secretariat, this document refers to the impact on business, toegher with statistical evidence that these increases will incur. Read more..
Temporary Agency Workers
Prepared by the HR and Social Policy Committee, together with the assistance of the Malta Chamber Secretariat, the document discusses Temporary Workers Agency Regulations and makes a number of recommendations in this regard. Read more...
SBA White Paper
Prepared by the SME Committee, together with the assistance of the Malta Chamber Secretariat, this document is a reaction to the White Paper which covers the incorporation of the Small Business Act into Maltese law. The document makes a number of recommendations in this regard. Read more..
Reaction to Malta Competition and Consumer Affairs Authority Act
Prepared by the Fast Moving Consumer Goods Working Group, together with the assistance of the Malta Chamber Secretariat, this document refers to the infrastructure of the new Authority, providing feedback on each proposal. Read more...
Pre-Budget Proposals 2011
Prepared by the Malta Chamber Secretariat, this document refers to the proposals made by the Malta Chamber. Read more..
Budget Reaction 2011
Prepared by the Malta Chamber Secretariat, this document refers to the proposals made by the Malta Chamber. Read more..
Business Expectations and Performance in the Maltese Islands 2010 – 2011
Prepared by the Malta Chamber Secretariat, with the assistance of Malta Chamber members, this document was compiled as part of the yearly Eurochambres Economic Survey, referring to Maltese businesses' confidence and expectations for the year ahead. Read more..
A Focused Economic Support Package for the Maltese Economy
This document, compiled in January 2009 was presented to Government in order to offer the Malta Chamber’s short, medium and long term recommendations to stimulate the Maltese economy during the current economic recession. Read more..
A Flexicurity Pathway for Malta 2008 – 2010
Prepared by the HR and Social Policy Committee, together with the assistance of the Malta Chamber Secretariat, the document discusses the benefits of flexicurity and the Malta Chamber’s recommendations on how this strategy, which is being adopted all over Europe, can be implemented. Read more..
Policy Papers on Rent Reform
Compiled by the ad hoc Rent Laws Committee, three position papers have been finalised including the response to the white paper published in August 2008, the recommendations of the Committee on the draft legislation published in December 2008, and a paper on the Act no X of 2009 amending the Civil code, Cap 16. Read more:
Chamber Rent Laws Paper May 2009, Rent Law Reform Report, Rent Reform White Paper August 2008.
Directive amending Council Directive 92/85/EEC on the introduction of measures to encourage improvements in the safety and health at work of pregnant workers and workers who have recently given birth or are breastfeeding” economy
Prepared by the HR and Social Policy Committee, together with the assistance of the Malta Chamber Secretariat, this document reviews the ‘Maternity Directive’, including the Malta Chamber’s position on each recommendation, as well as its own suggestions. Read more..
Position on the ‘Solid Waste Management Strategy for the Maltese Islands
Following the publication of the document entitled ‘Solid Waste Management Strategy for the Maltese Islands’, the Malta Chamber Environment and Energy Committee, together with the assistance of the Malta Chamber Secretariat has compiled a document review, with the aim of sending its recommendations to all stakeholders. Read more..
Position Paper on Banking Time
This document, compiled by the HR and Social Policy Committee, together with the assistance of the Malta Chamber Secretariat, is based on the premise that the debate about employee flexibility has never been more contentious or more important. The Malta Chamber believes that labour market flexibility is a key concept to improving competitiveness and hence ensuring employment. Read more..
Position Paper on Small Business Act
Prepared by the HR and Social Policy Committee, together with the assistance of the Malta Chamber Secretariat, this document reviews the Small Business Act, as well as including recommendations for implementation in the local scenario. Read more..
Position Paper on Working Time Directive
Prepared by the HR and Social Policy Committee, together with the assistance of the Malta Chamber Secretariat, this document reviews the current amendments being suggested on this issue that is critical to Malta’s employment, in particular sectors affected by seasonality factors.
Position Paper on Blueprint for MEPA Reform
Following Government’s announcement of a blueprint for MEPA reform, the Malta Chamber formed an ad hoc Working Group, in order to review said document and compile the Malta Chamber’s position on the numerous measures suggested. Read more..
The Malta Chamber Secretariat has also compiled a document regarding the importance of associations, and the benefits of their affiliation to the Malta Chamber, not only for the Malta Chamber itself but also for the various associations, through support and exposure Read more..
Following the reading of the Budget for 2010, the Malta Chamber compiled a document with its positions on various issues, as well as recommendations. Read more..
Strengthening of the Competition Authority and Consumer Safeguards
Prepared by the Fast Moving Consumer Goods Working Group, together with the assistance of the Malta Chamber Secretariat, this document refersto the remit of the strengthened authority and price monitoring analysis, among other topics, with a number of recommendations. Read more..
Prepared by the SME Committee, together with the assistance of the Malta Chamber Secretariat, this document is a reply to a call by BusinessEurope for feedback regarding each member country's practices as regards family businesses. Read more..