Vatican lawsuit against Futura Funds

As reported on November 8 (“Vatican woes its own fault, says Maltese company in multi-million euro lawsuit”), Futura Investment Management is taking legal action against the Vatican Bank. The Bank has defaulted on its contractual commitments relating to a Hungarian property investment.

We will be seeking financial compensation for losses related to delays on the deal and reputational damages from IOR’s original legal claim.

We have been greatly disappointed by IOR’s breach of contract, which resulted in the postponement of refurbishing one of the most beautiful buildings in Europe and a jewel in the crown of the Hungarian capital.

The Futura-Kappa fund purchased the Budapest Exchange Palace in 2013 with the objective of refurbishing it, repositioning it in the market and selling it at a profit. This acquisition was made at the target price of €32m (for a 90% interest), which was significantly below the €40m valuation of the building at the time. This investment was clearly presented to IOR’s representatives at the time and represented an extremely attractive investment opportunity. The property is valued today at €56 million and, once redeveloped, will provide an attractive return for all investors.

In 2013, the IOR entered into contractual commitments to invest €41m. However, it only invested €17m and is, therefore, clearly in default on its obligations to meet its outstanding capital commitment of €24m as well as compensation for losses caused due to the delay in the development. This fell significantly behind schedule, which was a direct result of IOR’s failure to honour its contractual obligations.

In June 2017, despite having defaulted on its capital commitment and after months of negotiations, IOR rejected a bona fide offer to purchase its shares in the Futura-Kappa fund for an amount close to its original investment. This offer was rejected without the benefit of an explanation, a dialogue or a counter-offer.

Futura believes that IOR made what could have been a highly profitable investment had it not reneged on its obligations.  On the contrary, it appears that Futura has been caught in the cross-fire between the current and previous management of IOR.

The development of Budapest Exchange Palace recently recommenced as Futura Investment Management secured additional investment. They continue to be optimistic about the ultimate success of the existing project and the completion of this landmark building.

Andrea Suriano

General Counsel,

Futura Investment Management

Unfair criticism over Malta’s tax system

The Malta Fund Industry Association (MFIA), Malta Association of Retirement Scheme Practitioners (MARSP) and the Society of Trust and Estate Practitioners (STEP) Malta branch note the conclusions contained in the final report issued by the EU Parliament’s PANA Committee (the PANA Committee) on 8th November, 2017.

MFIA, MARSP and STEP note with regret that Malta’s tax system was, during the course of the events leading up the appointment of the PANA Committee and during the course of its mandate, subject to unfair criticism and speculation.

Without wishing to enter into the merit of the other findings and recommendations by the PANA Committee, MFIA, MARSP and STEP note with satisfaction that the PANA Committee has, by means of its report, definitively laid to rest the unfair criticism and speculation about Malta’s taxation system.

Notably, the PANA Committee confirmed, consistently with findings by other EU institutions in the past, that the Maltese tax system is in line with current international and EU standards as regards harmful tax competition and that Malta has transposed EU rules and respects OECD standards in terms of transparency, fight against tax fraud and money laundering.

MFIA, MARSP and STEP call on all the stakeholders of the economy and the local media to work together for the common good of the industry.

In this light, MFIA, MARSP and STEP support the conjoined statement issued by FinanceMalta, the Institute of Financial Services Providers, the Chamber of Commerce, Enterprise and Industry and the Gozo Business Chamber in relation to Malta’s tax system and the findings of the PANA Committee of 10 November, 2017.

Matthew Brincat,

Anthony Cremona &

Kenneth Farrugia

On World Children’s Day

World Children’s Day highlights the right of every child to enjoy a life which guarantees the provision of, among others, a family, educational and health services; protection from harm and abuse, and participation. As a human being a child has the right to be treated as an individual with dignity and respect. 

Those entrusted with the care of children, such as parents, guardians, educators and social workers, should strive to ensure that all children enjoy their childhood. Listening to children and taking their wishes and opinions in consideration, especially in matters that concern them, is of utmost importance. Children need, above all, love and security. 

For the second year running, the Office of the Commissioner for Children was instrumental in encouraging schools and other entities to celebrate World Children’s Day. Over 60 primary, middle and secondary State, Church and Independent Schools, have responded positively to this call. The schools’ initiatives include a no homework day, special assemblies, healthy eating workshops, sports activities, games, crafts, discussions and activities embracing diversity and inclusion. Various Local Councils are also organising activities to commemorate this day. 

The Office is also distributing various age-appropriate publications which promote children’s rights, to primary school children attending, state, church and independent schools. These include colouring books, story books and games. 

The Children’s Policy which was up for consultation some months ago will be officially launched together with a colourful child-friendly version of the Policy prepared by the Office.

Suzanne Garcia Imbernon

Office of the Commissioner for Children