Almost 3,000 vessels de-flagged from Malta Ship Registry over five years

Almost 3,000 vessels were de-flagged from the Malta Ship Registry between 2019 and 2024, with 89 vessels de-flagged in the first three months of 2024 alone, according to information from Transport Malta.

During the same period, 4,273 vessels were registered to the registry, marking a net increase of 1,318 vessels over the same period.

Ships can be de-flagged for a variety of reasons. The owner may opt to delete the vessel from the registry without providing a reason, and possibly register the vessel elsewhere.

A spokesperson for Transport Malta said reasons for deletion are mainly due to unpaid fees, failure to provide the necessary documentation for full-term registration, sale by judicial order or for non-compliance with the Merchant Shipping Act.

On average, around 500 vessels were de-flagged each year, except for a spike in 2022 which saw almost 800 vessels removed from the register.

According to figures tabled in parliament earlier this year, the Malta Ship Registry has been growing steadily over the years.

The registry was set up in 1973, with only 27 vessels registered that year. By 2023, that number grew to 9,542 vessels.

The largest increase in vessels registered to Malta was seen in 2021, when the registry saw a net increase of 476 vessels.

The gross tonnage of the overall registry also grew significantly over the years, reaching 81 million in 2023.

It reached an all-time high in 2021, when it reached 86 million in gross tonnage.

Ship registration serves as a regulatory measure. Apart from assigning a nationality to the vessel, the country of registry is also in charge of regulating the ship’s operations.

The Malta Ship Registry is the EU’s largest ship register and ranks amongst the seven largest global ship registries. Due to its fleet performance, it is also on the white lists of both the Paris and the Tokyo Port State Control memoranda of understanding.

However, the International Transport Workers’ Federation has declared the Malta maritime flag as a ‘flag of convenience’. A flag of convenience vessel is one that is registered under the flag of a country different from its actual ownership.

By opting for this practice, ship owners benefit from minimal regulatory oversight, economical registration fees, reduced or nonexistent taxation, and flexibility to hire inexpensive labour, depending on the country.

The International Transport Workers’ Federation insists on having a ‘genuine link’ between the true owner of a vessel and the flag it sails under. It believes that so-called flag-of-convenience registries complicate efforts by unions, industry stakeholders and the public to hold ship owners accountable.

The Malta maritime flag does come with financial incentives, including tax and duty exemptions, and there are no restrictions on the nationality of shareholders or directors of Maltese shipping companies. Local laws also allow for the registration of vessels that are under construction.