When is a foreigner a tourist?

Appeals Court overturns guilty verdict that found a man guilty of renting a flat to a foreigner without an adequate licence.

The Court of Criminal Appeal has overturned a court judgment that found a man guilty of renting a flat to a foreigner without an adequate licence. In his judgment Il-Pulizija v. Paul Borg, Mr Justice Lawrence Quintano on 21 May 2013 upheld an appeal lodged by the defendant that the person he had rented a flat to, though a foreigner, was not a tourist, since he had lived in Malta for over a year.

Paul Borg was charged with having rented a flat in St Paul's Bay without the necessary licence from the Malta Tourism Authority. He was found guilty and fined €1164.69. Mr Borg appealed the sentence on the grounds that the prosecution had produced only one witness and that the tenant was a European Union citizen and therefore cannot be defined as a tourist. If this were the case, the law would be discriminatory and in breach of the right of freedom of movement of EU citizens within the EU. The appellant ask the court to refer the issue to the Court of Justice of the European Communities.

The Court examined the evidence and heard that the property in question was not covered with the necessary MTA licence. An MTA inspector had visited the flat in question following a complaint. A foreigner opened the door and informed the inspector that she travelled to Malta "every now and then". Since she was a foreigner, the MTA insisted that the flat had to be covered by a licence. In another flat, the inspector found a foreign gentleman. This gentleman said he worked as a time-share operator. The MTA claimed that for a flat to be rented for long let, it need to be rented for not less than one year.

Mr Borg testified and presented the contracts to the Court. He stated under oath that these flats were first rented for short let, but then converted to long-let leases. One of the tenants was introduced by an agent, and although not Maltese, she had Maltese relatives and even spoke Maltese. The problem arose when she wanted to terminate the lease after one month and expected that she be refunded the deposit she had paid at the beginning of the lease. Mr Borg refused because that would have meant that the flat was given on a short-let basis. The other gentleman told the court that he was living and working in Malta for a year and a half. He also stated that he rented the flat for periods of one year after another.

The Court disagreed with the appellant that the prosecution had presented only one witness, saying it in fact had produced three.

The Court examined whether this case could be referred to the Court of Justice of the European Communities, and according to section five of the European Union Act (Chapter 460 of the Law of Malta), if there is an issue of interpretation this may be dealt with by the domestic court but in accordance with the principles laid down by the Court of Justice of the European Communities. On the other hand, the treaty on how the EU is to function states that the Court of Justice shall have jurisdiction to give a preliminary ruling concerning the interpretation of the treaties and the validity and interpretation of the acts of EU institutions, bodies and office or agencies. The Court argued further that the MTA is not an EU institution or body.

Mr Borg in essence argued that the Malta Travel and Tourism Services Act, which regulates these licences, is discriminatory between Maltese and other European Union citizens. The Court commented that this is not the case, because a Maltese national may be a tourist in Malta, and therefore the flat that he rents has to be covered by a licence. The Court declined to refer the case to the Court of Justice of the European Communities but examined the meaning of the word "tourist". The Malta Travel and Tourism Services Act prohibits any person from running a hotel, guest house, hostel or holiday premises without a licence. Neither can any person rent a house to a tourist without a licence. The Court noted the distinction which is made in the law between rental properties for tourists and holiday premises.

The court concluded that Mr Borg had managed to prove that the tenant was not a tourist because he had lived for more than a year in Malta and overturned the sentence, declaring Mr Borg not guilty.

Malcom Mifsud is an associate at Mifsud & Mifsud Advocates

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Anthony Demanuele
The answer to the banner headline question is surely " as soon as that foreigner steps on an Arriva bus".What residency basis was the long -let lessee here on?What was the annual rental income for the property in question? (highly pertinent given that non-Maltese have to pay a minimum annual amount).Did the property owner have a licence to rent his property per se-and not just to alleged tourists? Did he register this property as a rental one and declare his income derived for such a business?More questions-all not asked -here than answers!

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