The Malta Business Observer, 26th March 2020

NEWS Issue 108

| March 26, 2020

Distributed with Times of Malta

ousands of private sector employees in the lurch

ere is growing concern among financial services practitioners that Malta risks facing serious repercussions and sanctions if it is grey listed by the Financial Action Task Force. see pages 12, 13, 15 >

Ray Bugeja Business owners across various industries have been vociferous in their criticism of the new measures announced by the Government on Tuesday, saying that the exclusion of many sectors will impact thousands of employees, leaving them in the lurch, and exposing the firms to the devastating economic effects of the COVID-19 pandemic that continue to hit the island.

In the real estate sector, Benjamin Tabone Grech, Chief Executive Officer of Engel & Völkers, said that, although the latest aid package is better than the first, the services industry and the industry in which he operates have been largely left stranded. His company, Mr Tabone Grech continued, would do its utmost to protect its 20 employees and 50 agents.

He expressed concern over the future of the rental market, stating that over the past days, he was approached by more than 50 landlords informing him that their properties were now vacant. He could not say exactly continued on page 3

BUSINESS OPINION

e President of the Malta Chamber of Commerce, Enterprise and Industry, Perit David Xuereb outlines the challenges facing businesses in Malta during the COVID-19 crisis and gives his views on the Government’s recent measures. see page 11 >

CASE STUDY

e Commissioner for the Rights of Persons with Disability (CRPD), Oliver Scicluna, talks about how the entity is working on connecting various stakeholders in the business and social arenas to facilitate inclusivity through the Malta Business Disability Forum (MBDF). see pages 16, 17 >

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Rental market, financial services and IT among many sectors left out in new measures continued from page 1 whether that had happened because, for instance, the occupier had lost his job but what was certain was that other measures were needed to strengthen the rental market.

In financial services, Wayne Pisani – who is also the President of the Institute of Financial Services Practitioners and a Partner at Grant Thornton responsible for risk and regulatory services but who was commenting in his personal capacity – said that the sector was in no way considered for support in the Government’s latest financial aid package.

The financial services industry, he continued, is a large employer (as are the tourism, hospitality and manufacturing industries) and, if the pandemic drags on, financial services industry players are likely to consider downsizing too. It is already feeling the effects of the situation with clients pulling out or asking for delayed payment terms or, even, terminating services, with some IFSP members also indicating they have started discussing with their employees the possibility of working reduced hours.

“Hence, while fully appreciative that resources should be addressed to help businesses in sectors hardest hit by the coronavirus outbreak, regard is to also be had of other business,” he asserted.

In manufacturing, Farsons Group CEO, Norman Aquilina

said that the firm has noted “that the manufacturing industry has been classified amongst the less critical and therefore received limited support compared to the segments classified as critical. This does come somewhat as a surprise considering that certain manufacturing industries, such as Farsons, rely heavily on tourism along with all hotels, bars and restaurants which have now been closed down. We can add to that the numerous indoor and outdoor events which are being cancelled or indefinitely postponed, together with the external activities of village feasts. All of this impacts heavily on our own business,” he said.

Moreover, while it was still “premature to quantify the extent of the impact of both the COVID-19 pandemic along with the intended mitigating Government measures”, the situation “will certainly intensify in the coming months,” he said. Indeed, “the impact is expected to be significant.”

As a plan of action, the CEO said the firm was in touch with Malta Enterprise to better understand, implement and quantify the measures announced. However, he firmly stated that they believed “manufacturing deserves to be given more thought and attention and we do expect to be given further support in future measures yet to be announced. We are also seeking clarification on the procedures

“e manufacturing industry has been classified amongst the less critical and therefore received limited support compared to the segments classified as critical. is does come somewhat as a surprise.”

– Norman Aquilina, Farsons Group CEO

regarding the measures announced as many queries from employees and ourselves remain unanswered at this point in time,” he concluded.

Representing gaming, Alan Alden, a director of a consultant company involved in remote gaming and data protection, and the General Secretary of the Malta Remote Gaming Council, lamented the fact that there is no representation of the gaming industry on the Malta Council for Economic and Social Development.

“Now is the time to show that the Government respects and wants the industry to survive and stay,” he insisted.

He said that although some operators have so far not been as badly affected by the virus as the

sectors receiving the aid, there are companies that are already struggling. Operators whose main source of revenues is derived from sports betting have been just as badly hit and have practically zero revenues, he pointed out.

The Government, Mr Alden added, should carry out a detailed analysis of the drop in revenues of the gaming sector and react accordingly. For example, gaming taxes and compliance contributions payable monthly should be waived until revenues can be generated. Also, hardest hit operators should also benefit from the €800 aid.

In the meantime, in the tech sphere, iMovo Ltd Managing Director Pierre Mallia said there is “disappointment” and “anger” by

several companies in the technology sector for being left out of the latest aid measures announced by Government on Tuesday night to help businesses get through the COVID-19 pandemic.

“We have endured massively challenging years of not being able to find skilled personnel easily. This was exacerbated by spiralling salaries due to a sector of largely international firms. We had to import a large proportion of our workforce and train people up. With our customers also at a standstill, we are collectively facing challenges because projects are being cancelled, services are also being terminated and we are being forced to potentially lay off for cashflow reasons, resources we have invested heavily in.”

Mr Mallia said that amid a loss in turnover, many have been left with a feeling of bitter disappointment at not being eligible for the first wave of measures.

In the media sector, Jesmond Bonello, Co-Founder and Managing Director of Content House Group, pointed out that the majority of businesses working in the services industry have been badly hit, and are in shock that the Government has not given them any real assistance.

“The Government,” he asserted, “decided to be selective and is assisting sectors that have been badly hit but leaving out, in the continued on page 5

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e situation “will certainly intensify in the coming months ” – Farsons CEO continued from page 3 process, thousands of businesses that are equally badly hit, and leaving the future of thousands of employees in abeyance. The media industry is one of these.”

He explained that, as media publishers, owning and managing a large portfolio of brands in the online and print industry, and employing a team of 40 people, Content House Group operates in an environment that is directly impacted when there is an economic crisis.

For the Managing Director of Allied Newspapers Ltd, Michel Rizzo, what the country is experiencing is unique and unprecedented.

It is no secret there has been a slowdown in the media business, with advertisers in a bit of a “waitand-see” mode, Mr Rizzo noted.

On the flip side, he continued, his company’s online news platform is “simply flying at the moment”, a golden opportunity for advertisers to get their message across to their markets.

Referring to the financial aid packages recently announced by the Government, Mr Rizzo admitted he was very disappointed with what he has seen so far, in terms of financial support that is specific to the media industry. It does not seem that the industry is on the Government’s radar, at least for the time being, he remarked.

“Our industry is one of the hardest hit at the current moment; our revenues have been decimated and our financial losses are substantial. The media is recognised as one of the main pillars for a democratic country such as Malta. It, therefore, needs to be supported with concrete measures that will guarantee its survival. Across Europe, independent media organisations have been benefiting from state aid for many years now, and not just during troubling times such as these. The Government needs to understand that safeguarding media companies ultimately translates into safeguarding the country’s democracy,” Mr Rizzo concluded.

The Malta Producers’ Association initially welcomed the latest measures announced by the Prime Minister as it was implied that the film/TV industries are included. “However, the MPA was surprised to learn… that the film/TV sectors do not seem to have been included in the list of sectors presented by Malta En-

terprise as being covered by the measures (in Annex A),” its Chairman, Simon Sansone said.

The exclusion (from Annex A) could be a result of the NACE classification used by Malta Enterprise and the EU with regards to the film/TV sector. The MPA was yesterday awaiting clarity on the matter.

“Given the impact on the industry has been so catastrophic, its survival is dependent on adequate, direct assistance being granted to its working crew and personnel, otherwise there is a serious risk that there will be no industry to relaunch the other side of the pandemic,” he said.

The MPA expects the authorities to communicate with its stakeholders and film/TV personnel to take stock and let them know what is happening.

Claudio Grech, the Nationalist Party’s spokesman for social policy, said “it is disappointing to see

“Given the impact on the film industry has been so catastrophic, its survival is dependent on adequate, direct assistance being granted to its working crew and personnel, otherwise, there is a serious risk that there will be no industry to relaunch the other side of the pandemic.” – Simon Sansone, MPA Chairman

that the Government is now being selective between industries... there is a gross misconception that the knowledge-based industries, information, media, technology, financial services and related professional domains will not be impacted by the COVID-19 crisis. This is completely mistaken,” Mr Grech asserted.

The bottom line, he noted, is that out of the 164,000 employees in the private sector, over 100,000 are being treated in a discriminate manner irrespective of whether their income has suffered a massive drop or otherwise.

He also pointed out that the country’s economic success

was primed by employers with a vision, who borrow money, risk their own assets (many times their own residential property) and strive hard to build an enterprise they look after like their own children and pride themselves of seeing it grow from one generation to another.

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PM’s measures positive, tourism stakeholders say, but uncertainty still a concern Rebecca Anastasi Businesses and stakeholders within the tourism sector have welcomed the Government’s new measures announced on Tues-

day night in response to the coronavirus crisis yet have said that the high level of uncertainty is still a major concern.

Alan Arrigo, a Director at Robert Arrigo & Sons, said the new measures “will have a pos-

itive impact” on their business in the short-term. However, “if the crisis lasts longer, then further measures would be required as the period with no income is lengthened.” He also specified that, in his opinion,

and overall, the Government’s new initiatives will “prevent some layoffs in the short term for solid businesses” though “businesses with less than ideal financials will still have to layoff people” anyway.

Indeed, he further noted that “the current assistance package announced by Government only makes sense as part of a wider plan of substantial assistance, escontinued on page 8

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“We have a breather for three months” – MHRA President continued from page 7 pecially if the crisis drags on in other source markets for Malta.”

He said other measures which should be introduced included “access to more liquidity to travel and tourism companies (both outbound and inbound)”, the “introduction of the possibility of carrying back tax losses of 2020 to profits of 2019”, as well as “allowing even further flexibility in the application of the package travel directive, to allow vouchers to be given instead of refunds”, saying, in reference to this latter that “other EU countries have legislated this already.”

Yet, he was at pains to emphasise that “there is no one-size-fitsall measure and certainly there is no measure that will completely contain the damage that this crisis will cause.” For, indeed, uncertainty is the biggest issue for the sector, which might, in his words, “see less hotels on the market; fewer, leaner agents and DMCs chasing this business,” as well as less suppliers, should the status quo persist.

International Hotel Investments Plc – owners of the Corinthia and Radisson hotels – underlined that the new measures will help mitigate the disastrous effects COVID-19 has had on the sector locally. “We, of course, welcome the measures announced as they continue to tangibly support our determination to retain all our full-time employees on our books and weather the storm together. We have no intention to pursue any redundancies across all of our businesses,” Jean-Pierre Schembri, the Group’s Director Corporate Office and Company Secretary said.

Despite this, Mr Schembri said the Group will be monitoring the situation, which “will be reviewed on a month-by-month basis”, specifying that they will “take further action should the situation persist”, though no details were forthcoming as to what actions these may be.

In the meantime, the hotel group has had to take several other initiatives on board in order to minimise the financial bleed. “For some weeks now, we have addressed a series of cost cutting and cost containment measures, which include shutting down of hotels or shutting down entire wings or floors in our hotels. We have directed no

new CAPEX, no new recruitment, no payroll shifts and no travel. We are also watching costs and conserving amenities, energy and consumables,” Mr Schembri explained.

Other than the financial, Mr Schembri also noted other initiatives focused on the health and safety of the hotels’ staff and guests. “We have been for several weeks and will continue to take all measures as directed by all relevant health authorities in the various jurisdictions we are operating. Internal guidelines on operations and staff welfare have been in circulation for some time,” he said.

Elsewhere, the Malta Hotels and Restaurants Association (MHRA) has come out in the local media praising the new measures. Approached by The Malta Business Observer to comment on the uncertainty worrying some stakeholders, Tony

Zahra, the body’s President, said “we have been given a breather” and advised businesses in the sector to see how things progress, saying that if the situation has not resolved itself in three months’ time, then further action will be considered.

“The problem we have today is liquidity,” he explained. “There is not enough money in the system to keep businesses going. This injection announced by the Government is similar to that implemented by other countries.”

Should there not be this capital injection, he said, then many companies would be forced to close their doors. “The virus should have taught us a valuable lesson. Let’s get over these weeks,” he advised.

He also encouraged companies to look at the long term, saying that he did not know of any firms that had already laid off people, cautioning that “this is a question of survival – if the com-

“We have no intention to pursue any redundancies across all of our businesses.” – Jean-Pierre Schembri, International Hotel Investments Plc Director Corporate Office and Company Secretary pany closes it closes forever – if it survives it can restart.” He also specified that he hoped the lock down would only apply to restaurants for five to six weeks, which would mean they would be able to recover earlier.

Asked whether the crisis affected smaller companies more than larger ones, Mr Zahra said that the issues were of concern to both. “All companies are in trou-

ble no matter the size. However, companies would be in different stages of the economic cycle. For example, a property that refurbished three years ago might be in a better liquidity position than one that is just exiting a refurbishment and looking towards some income coming in. Can bigger companies help smaller ones in this situation? I doubt it.

Bigger companies are facing the

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same problem as smaller ones – there is no cash coming through the door – only expenditure.”

In the meantime, the Chief Executive Officer of the Federation of English Teaching Organisations in Malta (FELTOM), James Perry, has questioned why the entire English language teaching sector was not mentioned from the list of industries to benefit from the Government’s third set of measures announced on Tuesday evening.

“We were the first to be affected – with cancellations from key markets and ELT schools being closed two weeks ago – and we will feel the effects for many months to come. We contribute approximately 10 per cent to the total bed nights in Malta and €137.3 million to the national economy, so how can such a big player be forgotten?” he said.

Indeed, Annex-A issued by Malta Enterprise (ME), clarifying which sectors and industries stand to benefit from the scheme, does not specify ELT. Attempts to contact ME to clarify proved futile, while Mr Perry has already sent an email to the

“All companies are in trouble no matter the size.

However, companies would be in different stages of the economic cycle.” – Tony Zahra, MHRA President

Prime Minister and communicated his concerns to the Ministry for Tourism.

The ELT sector is, indeed, one of the hardest hit by the COVID19 crisis. A study commissioned

by FELTOM – and carried out by Deloitte Malta – specified that over 20,000 student arrivals have cancelled, to date, amounting to a loss of €8.8 million to FELTOM schools, with the total loss to the Maltese economy currently standing at €23.7 million . Should the number of cancelled student arrivals reach 60,000 – likely if the situation does not resolve itself by the

summer – then the industry would see a loss of €20.3 million, with the Maltese economy losing €71.1 million.

As a result, the repercussions of the crisis have already been deeply felt on the ground, Mr Perry said, revealing that three schools had already been preparing to lay off staff, while one – Cavendish School – had already made everyone redundant, though he was not in a position to say whether the new measures, which are retroactive from the 9th of March, would reverse that original decision. In the meantime, some schools have suc-

ceeded in moving their classes into online scenarios, while some have even offered additional support. For instance, Clubclass English Language School announced on Facebook that they will be providing accommodation to students from 21st March until the date when flights to and from Malta resume to in-house students at no charge.

Yet, Mr Perry saw reason for optimism in the measures announced on Tuesday night.

“These measures will prevent layoffs and make sense. Now, there’s a base rate where the employer can keep the staff or, even, nego-

tiate with them should they not be able to match the Government’s contribution with the €400 being specified,” he said.

He was also pleased to note that the authorities had recognised the particular difficulties facing the tourism sector, which would take longer to recover, saying that this seemed to indicate that the Government would be open to providing further subsistence once the three-month block has passed. “We are happy they recognised it might need longer than three months since it will take a long time to recover,” he asserted.

However, he pointed to other expenses which are still not covered by the measures but which comprise a substantial percentage of the outgoings of each employee and employer, namely rent, water and electricity. “If someone earns €800, and they’re paying €400 or €500 for their apartment, then this is still an issue. Of course, the new measures are much better than before, but discounts on utilities and rent would have also gone a long way,” he said.

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EDITORIAL

A recipe for unemployment To say the situation is dire is an understatement. The country has almost completely ground to a halt as a result of the coronavirus crisis and – save for supermarkets, green grocers and pharmacies, among very few others – business small and large, together with their employees, are feeling the hefty brunt of it.

Of course, this is not a situation in which Malta finds itself alone. This week, global economic indicators pointed towards deep, historic recessions across the world as more countries enter lock down, businesses shut their doors and staff head home. The G7 pledged to do “whatever was necessary” to provide aid and prevent an economic catastrophe, while in Britain, the UK government has pledged to pay grants covering 80 per cent of the salary of workers if companies kept them on their payroll, with pay outs worth up to a maximum of £2,500 (approx. €2,700) per month. Denmark has also put its money where its mouth is by pledging to pay up to 75 per cent of the monthly salaries of employees, or 90 per cent for hourly workers, which may cover up to 26,000 Danish kroner (approx. €3,400) per month – as

long as companies do not lay these workers off.

Here in Malta, on Tuesday night, Prime Minister Robert Abela announced a third set of measures (after the first two tranches were heavily criticised as being insufficient), applicable for a three-month period, which aim to cushion the blow by subsidising employee wages of a select number of sectors hit by the crisis. But the sectors that will benefit from these measures represent only one-third of the employees working in the private sector and such measures are applicable to the minority of the businesses and companies operating in Malta. Thousands of local businesses are in shock and utter disbelief as to how the Government has decided to leave them in the cold, ignoring the fact that their business concern has come to a halt or has been very badly affected; and now they have to take tough decisions that concern their business and the thousands of employees they employ.

Many important sectors – manufacturing, ICT, logistics and shipping, media publishers, advertising agencies, the film industry, property, real estate and con-

struction, accountancy firms, financial services, and many more – are not eligible for the main Government initiative covering €800 per month for each employee. The other measures announced by the Government are a smokescreen and do not offer substance and any tangible help.

We do not have a crystal ball. We don’t know how long this crisis is going to last or whether it will rear its ugly head again, and again in the future. One thing we do know is that, in times of earth-quacking crisis, the current global economic system is unable to deal with such heavy shocks without Government aid.

For, while Government interference has, for decades, been frowned upon – with deregulation being touted (perhaps too enthusiastically) as the panacea for all economic ills – this time, Government intervention is necessary. The alternative is simply too chilling to contemplate and will have a domino effect of mammoth proportions, leaving the country reeling for many years to come. We believe that the Government has produced a recipe for unemployment.

e Malta Business Observer is Malta’s leading business newspaper distributed with Times of Malta every month.

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BUSINESS OPINION

We can get out of this, stronger than before

Perit David Xuereb These are truly extraordinary times. The unfolding events which we are witnessing have decidedly changed the way we live our lives, carry out our professions, and interact with each other. The days we are living warrant an extraordinary response to the crisis we are battling, in order to not only mitigate the negative effects this is having on everything we know, but also to be in a position to bounce back, once all this ordeal is over.

That is why, as Malta’s foremost business representative body, we have mobilised our full network and resources in order to support Malta’s business community without distinction, at this time of extraordinary need. Simultaneously, we are in constant con-

tact with the highest officials in Government to make sure that businesses are given the necessary life-lines that will prove critical for their survival.

At this juncture, and as things stand today, as a Chamber we are satisfied with the outcome of the consultation process and the revised measures as announced by Government on Tuesday night. The measures, we feel, largely reflect the suggestions we put forward in so far as stopping the instant haemorrhage we experienced with the sudden closure of travel and non-essential retail, among other effects. The Chamber will continue to follow the situation closely and keep an open channel of communication with the Government, as the situation develops further, possibly necessitating further adaptation in terms of scope and duration.

To this end, as a Chamber we shall also be monitoring the developments and needs in each economic sector, particularly because of the secondary effects of the crisis which could hit new ones as we go along. Of particular interest to us is manufacturing which, in every economic crisis, is called upon to act as a pillar on which the remainder of the economy can rest.

The direct support for salary payments was an important priority measure for the Chamber.

We insisted on it to ensure that employees are kept on the books while business is at a standstill.

This would serve to avoid largescale redundancies which would inflict untold hardship on families and a natural increase in the Government’s expenditure on unemployment benefits. At the same time, such assistance would ensure Maltese companies’ strong competitiveness position with no delay upon the resumption of business.

On the other hand, as referred to earlier, as a Chamber we are leaving no stone unturned to make sure we are representing our businesses with the best information available. Sectors which feel they are not best served are invited to come forward and speak to us as some have done, across a number of sectors, over the past days and weeks.

This week, we organised a high-powered e-meeting with the participation of 25 expert CEOs from the world of finance, banking and innovation. The meeting served to evaluate creative and tangible solutions to protect employment and address the economic impasse in Malta (both in

the immediate and short term) which we immediately forwarded to Government. We are pleased to see that these were largely taken on board.

This followed a research exercise we carried out over the weekend, whereby we asked the directly-affected parties, our members, to express themselves on this ordeal and what they thought of the first aidpackage. The response to this was phenomenal and the reactions chilling. That is why we remained vociferous in our representation.

In view of the constantly developing situation, we have also teamed up with the research team at one of Malta’s leading PR consultancy agencies, to provide our members with an exclusive daily bulletin covering the latest, verified news on the issue. In anincreasingly fluid scenario, where the correct information may make all the difference, we are confident this exclusive daily bulletin will serve to be a sterling resource for our members.

Concurrently, we are also keeping constant contact with the country’s public health authorities and, with no less than the Superintendent of Public Health, to seek guidance for our members but also offer support

in the dissemination of best practices, to businesses. As a Chamber, we also offered our assistance in helping members embrace social distancing procedures in a bid to reduce the risk of contamination and improve people’s quality of life.

Naturally, we do not have enough words of praise for the sterling work which is being carried out by Prof. Gauci and her team. The national effort against the spread of COVID-19, has been nothing short of outstanding.

Our appeal remains constant, as we encourage all employers to keep themselves abreast of all COVID-19 regulations and guidelines issued at regular intervals by the country’s public health authorities.

As a Chamber, and together with our fellow social partners, we are committed to continue working with our members, Malta’s major employers, but also our SMEs, in a concerted effort to pull through this difficult time, successfully. I truly believe that we can get out of this, stronger than before.

Perit David Xuereb is the President of The Malta Chamber of Commerce, Enterprise and Industry.

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FATF grey listing would be “disastrous” for Maltese financial services sector Ray Bugeja There is growing concern among financial services practitioners that Malta risks facing serious repercussions and sanctions if it is grey listed by the Financial Action Task Force [on Money Laundering] (FATF), and fails to convince Moneyval it has taken action to implement the “priority actions” listed in a report issued in July last year.

In its Fifth Round Mutual Evaluation Report on Malta issued last summer, Moneyval, the Council of Europe’s Committee of Experts on the Evaluation of Anti-Money Laundering Measures and the Finance of Terrorism and one of FATF's so-called Regional Style Bodies, called on the Maltese authorities to strengthen their practical application of the measures to combat money laundering and the financing of terrorism.

The report acknowledges that Malta demonstrated a broad understanding of the vulnerabilities within the system but a number of important factors, notably predicate offences, the financing of terrorism, legal persons and arrangements, the development of new technologies and the use of cash, appear to be insufficiently analysed or understood, it said.

More recently, Chris Buttigieg, Chief Officer responsible for Strategy, Policy and Innovation at the Malta Financial Services Authority, was quoted at a seminar organised by the Institute of Financial Services Practitioners last month, as saying that the island risks being placed on the socalled ‘Grey List’ of the Financial Action Task Force. The ‘Grey List’, in fact, groups jurisdictions that would be under increased monitoring.

“Malta risks being placed on the FATF ‘Grey List’. This is very serious. We need to raise the bar and ensure that there are certain standards and we need to convince our peers and international institutions that we’re serious in the way we carry out our supervisory financial processes and our enforcement,” Mr Buttigieg was reported as saying in the local media.

Francis J. Vassallo, founder of Francis J. Vassallo and Associates Ltd, and a former Central Bank of Malta Governor, admitted that judging by what he heard at the IFSP’s seminar, “the risk of Malta being placed on the FATF Grey List is very high.”

Mr Vassallo did not mince his words on the repercussions of such grey listing, saying “it would be disastrous” if that were to happen. “With regard to financial services, including corporate services providers and banks, it would be catastrophic.

Malta’s reputation abroad, which is already bad enough, would go to the dogs; no major serious client or law firm would recommend Malta as a decent jurisdiction to work with. The fund business would stop. The banks could lose the respective correspondent banks. This would also have a serious impact on business in general. I do not want to sound extra pessimistic, but it is better to point out the risks so that the Government would realise the seriousness of these repercussions,” Mr Vassallo asserted.

He again referred to the IFSP’s seminar, and expressed the view that, in his intervention, the Finance Minister did not give the impression there was concern, while the Shadow Finance Minister raised lots of problems. “The great surprise to all present was that, as soon as the politicians finished speaking, they left the seminar and did not bother to lis-

“If Malta fails, the financial services industry, employing thousands and representing an important part of the country’s GDP, will collapse.” – Francis J. Vassallo, former Central Bank Governor ten to what the other side was saying. This was when the former head of the Financial Intelligence Analysis Unit, Manfred Galdes, and Mr Buttigieg spoke and gave the realistic scenario,” he recalled.

“The perception by all was that the Prime Minister should get personally involved to see that all players with authority are doing their utmost to make sure that all Moneyval’s recommendations are implemented,” Mr Vassallo remarked.

Being fully aware of the Moneyval report, he pointed out that both the financial services practitioners and their institute have been extremely concerned that not enough is being done to remedy the situation. The seminar, he noted, made it evident that so much still has to be done with regard to the Attorney General’s Office, the police, the MFSA, the

gaming authorities and other institutions. “It was made clear that far more serious measures have to be implemented.”

If Malta fails, Mr Vassallo warned, the financial services industry, employing thousands and representing an important part of the country’s GDP, will collapse. His own firm, which has been in business for over two decades, employs 75 people.

To remedy the situation, the enforcement of laws is a primary priority, irrespective of the people involved, Mr Vassallo noted, insisting that the police must take cases to court, with assets confiscated when people are found guilty. “The world needs to see that the authorities in Malta are really taking action and not just saying they are acting,” he said.

In this regard, Wayne Pisani, President of the Institute of Financial Services Practitioners

and Partner responsible for risk and regulatory services at Grant Thornton, noted that, while some areas do merit new regulation, the majority of the Moneyval findings refer to areas that necessitate the implementation and the enforcement of the current regulations.

“We must work collectively as a country and an industry to remedy this as quickly as possible with correct demonstrable actions. Ticking all the boxes to pass the test is not enough. We still need to affirm ourselves as a valid jurisdiction, rebuilding the trust in Malta and restoring what we’ve accomplished throughout the past decades. Failing the test is, however, not an option, as that risks closing all doors and putting Malta’s aspirations as an international platform for business in more jeopardy,” Mr Pisani said, commenting in his per-

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sonal capacity as a practitioner in financial services.

He continued that, as counter-money laundering and funding of terrorism legislation continues to evolve, certain client acceptance or transactional fact patterns, particularly those relative to source of wealth enquiries, which might have been considered regulatorily acceptable in the past, are less likely to be acceptable today. Hence, the ongoing need for healthy professional scepticism at all times.

To this end, Mr Pisani called for better cooperation between regulators and the industry, possibly in the form of PPPs (Public-Private Partnerships), aligning all initiatives in the national interest. This applies also in the setting up of companies, he noted, saying that the Malta Business Registry, the FIAU, the MFSA and numerous practitioners’ representative bodies, such as the IFSP, the Malta Institute of Accountants, the Chamber of Advocates, the Malta Institute of Taxation, the Malta Bankers’ Association and

the Society of Trust and Estate Practitioners, are working closely to continue raising the bar on the type of businesses and legal entities setting up in Malta.

“The IFSP is in constant debate with stakeholders from both its practitioners’ membership base as well as institutional bodies and the authorities to raise the bar in the effective application of good governance and ethical principles. This, however, leads me to the principle of information sharing, which is unfortunately, presently, a one-way information sharing process to the central authority, with no reciprocity,” he pointed out. Indeed, he strongly advocated the introduction of a legislative framework addressing the situation.

Additionally, he underlined the need of enabling powers or laws providing for the exchange of information among practitioners, unencumbered by GDPR (General Data Protection Regulation) or tipping off concerns, and, possibly, even two-way information sharing between the public and the private sectors.

“This proposal finds comfort in a Europol report issued in October 2019, which makes specific reference to such public-private data sharing arrangements to mitigate cybercrime, which could lead to money laundering.

In this respect, the provisions of Section 314 (b) of the US Patriot Act [dealing with cooperative efforts to deter money laundering] are an interesting approach to facilitate information sharing among financial institutions and, possibly, even the wider subject persons group. This would work in the national interest,” Mr Pisani suggested.

How the country deals with such matters over the next months will be of crucial importance, he pointed out, though he highlighted the need for practitioners to also be cognizant of any necessary actions. “While the institutions have to do their part, service providers and practitioners are also to proactively engage in upholding Malta’s reputation,” Mr Pisani insisted.

In the meantime, Duncan Crawford, the FATF’s Media Relations Manager,, explained that

“Ticking all the boxes to pass the test is not enough.” – Wayne Pisani, Financial Services Practitioner decisions about countries are always made by the FATF Plenary, which usually meets in February, June and October. Asked whether the FATF was considering any specific action in relation to Malta, he replied that he could not “pre-empt the decisions of the FATF Plenary.”

Continuously identifying jurisdictions with significant weaknesses in their AML/CFT regimes, and to work with them to address those weaknesses is one of the FATF’s key objectives.

Its process is aimed at helping protect the integrity of the international financial system by issuing a public warning about the risks emanating from the identified jurisdictions.

Such public warnings are also meant to put pressure on the

identified jurisdictions to address their deficiencies and so maintain their position in the global economy. “Public identification, and the prospect of public identification, encourages countries to swiftly make significant improvements,” it says.

Among other issues, Moneyval is concerned that the Maltese law enforcement authorities are not in a position to effectively and in a timely manner pursue highlevel and complex money laundering cases related to financial, bribery and corruption offences.

The report notes that the supervisory authorities in Malta do not have adequate resources to conduct risk-based supervision for the size, complexity continued on page 15

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“Risk of Malta being placed on the FATF Grey List is very high” – former Central Bank Governor continued from page 13 and risk profile of the country’s private sector. Sanctions for non-compliance with antimoney laundering and countering the financing of terrorism requirements are not considered effective, proportionate and dissuasive.

Malta, Moneyval said, lacks an in-depth analysis of how all types of legal persons and legal arrangements can be misused for money laundering and financing of terrorism purposes.

There are also shortcomings in a multi-pronged approach to obtaining beneficial ownership information.

Based on its evaluation, Moneyval decided to apply what is known as an enhanced follow-up procedure and asked Malta to report back in December 2020.

Welcoming the report, the Government had reiterated its commitment to implementing the recommendations. Addressing a training workshop on antiterrorism finance last month, Finance Minister Edward Scicluna said the Moneyval report should serve as a benchmark to raise Malta’s standards.

“The Maltese Government is accepting all recommendations, without exception. The critical points are being identified and taken on board to increase resources and expertise. Malta has one of the largest numbers of regulators and supervisors in proportion to the size of the industry.

It is not, therefore, just a matter of manpower but, more so, about quality. Monopoly in the police force does not exist elsewhere, therefore, changes and reform are being undertaken in that regard as well,” he had said.

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Malta Business Disability F by bridging business and s Jo Caruana The Malta Business Disability Forum (MBDF), founded last year through the Commission for the Rights of Persons with Disability (CRPD), is working on connecting various stakeholders in the business and social arenas to facilitate inclusivity of those living with a disability, the Commissioner, Oliver Scicluna, said.

“As the CRPD, we felt the need to build a bridge between the business and social sectors, as there exists a lacuna of understanding between both areas,” he stressed.

“The MBDF is now expected to serve as a forum that comes up with innovative ideas on how, together, we can render society more inclusive in its approach.”

The Forum was founded in 2019 with the intention of bringing together stakeholders such as the Malta Chamber of Commerce, Enterprise and Industry; the Malta Employers’ Association; the Malta Chamber of SMEs; the Gozo Business Chamber; the Faculty for Social Wellbeing within the University of Malta; the Local Councils Association; the Office of the Commissioner for Mental Health; and the Malta Federation of Organisations for Persons with Disability.

And, indeed, there has already been progress in this regard, Mr Scicluna said, noting that all of the stakeholders signed a Memorandum of Understanding on 18th

“It is of utmost importance that disabled people’s potential is tapped.”

December 2019, in which they agreed to attend four annual meetings where arising topics will be discussed.

“Beyond that, we have also commissioned a research project about the current state of employment of disabled people and employers, and will be issuing findings and suggestions later on this year. In fact, these topics will be among the items on the agenda that will be discussed in the coming forum meetings,” he explained.

As for the progress that he hopes the MBDF will bring, he said this will be tackled through Government initiatives and therefore, the forum will draw Budget proposals for consideration.

“There is no doubt that the MBDF fits in perfectly with the work carried out by the CRPD. In both cases, all the advancements we strive for in today’s society will be contributed to through the private sector and the Government, and that is an extremely positive step forward,” he outlined.

PHOTO: TYLER CALLEJA JACKSON

Indeed, this ties in with one of Mr Scicluna’s main aims in his current role, which is to promote a rights model perspective rather

than a charity model. This would further underline the importance of having an inclusive society, where all its members are given the opportunity to participate fully. “My goal is to empower more disabled people in Malta and Gozo, by making them aware of their rights and obligations, so that they will be in a better position to lead a dignified life,” he continued. “It is of utmost importance that disabled people’s potential is tapped. As I have stated in the past, I would like to see more disabled people active in politics and policy-making, as well as filling leadership positions,” he asserted.

The CRPD has long been a pillar of the community and a driver for positive change. Talking through its history, Commissioner Oliver Scicluna explains that it was officially set up in 1987 and was previously known as the Kummissjoni Nazzjonali Persuni b’Diżabilità (KNPD). Its first Chairman was Lawrence Gonzi who, at the time, was also the Speaker of the House,

following which it was chaired by Joseph M. Camilleri.

“The Commission has played a very important role in the past 33 years,” Mr Scicluna said.

“Through its advocacy, it has managed to strengthen the rights of persons with disability and their families, both in Malta and Gozo.”

Its role has evolved over the decades. For instance, up until 2016, the Commission offered a number of services to persons with disability and their families.

But, upon the signing and ratification of the United Nations Convention for the Rights of Persons with Disability, the Maltese state was obliged to appoint a monitoring mechanism to perform the role of watchdog for the disability sector in Malta.

“Thanks to the hard work carried out by the Commission, we have seen a number of policies and legislation come into place – all of which work to safeguard the rights of persons with disability,” Mr Scicluna continued.

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Forum tackling inclusivity social sectors

“One of the strongest laws passed through Parliament – the first legislation of the millennium – was the Equal Opportunities Act CAP413 (2000) (EOA). This law was created to safeguard the rights of disabled people when it comes to discrimination in employment, education, housing, accessibility, the provision of goods and services, and so on.”

Changes have been ongoing since then. Among them, the EOA was last amended in 2016, to finetune the Commission and its structure, and enable its team to work as a regulatory institution. In fact, there was even a change of name to reflect the greater focus on the rights of persons with disability, and also the creation of the role of a Commissioner.

Discussing other important milestones for the organisation, Mr Scicluna highlighted when the Commission pushed forward two pieces of legislation – one which regularises the issuing and enforcement of the Blue Badge (used for parking), and the other to

transpose the ‘Accessibility standards for all in the built-in environment’ into legislation. “The result means that, now, when the public and private sectors invest in public buildings, they have to make sure that their premises are accessible for all,” the Commissioner asserted.

Shifting focus to his role, Mr Scicluna explained that the key responsibility is for him to follow the legislation in place and make sure that the rights of disabled people are being safeguarded. “When disabled people are discriminated against on the basis of their disability, I am expected to take all necessary measures to stop discrimination from happening,” he said.

“Of course, I am extremely passionate about the work I do and about the disability sector at large – not least because I am a disabled person myself. In the past, I was also an activist, and I worked on a volutary basis in a non-profit organisation led by disabled people,” he concluded.

“My goal is to empower more disabled people in Malta and Gozo, by making them aware of their rights and obligations, so that they will be in a better position to lead a dignified life.”

PHOTO: TYLER CALLEJA JACKSON

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Family Business Office on hand during time of crisis, regulator says Helena Grech Family Business Office (FBO) Regulator, Joseph Gerada, pledged the Family Business Office’s support through the incentives it offers, in these trying times that “came upon most businesses like a storm out of nowhere.”

“Like most countries, we were not prepared for such a situation.

This has affected everyone’s plans for 2020 including those of the Family Business Office,” he added.

Just last week, Dr Gerada and his office had to cancel an outreach session in Gozo, organised with the Gozo Business Chamber.

The plan was for one-to-one meetings with family businesses established on the island. However, due to recent events, it has been postponed until further notice.

Despite the massive disruptions being caused, Dr Gerada is optimistic Malta will be able to come through. “Our local economy is strong enough to weather the storm and the Maltese are known for their perseverance and resilience. If we all proceed as responsibly as we have done over the past weeks with the implementation of preventive action, we will see the sun shine again, hopefully sooner than expected,” he said.

The Family Business Office, legislated through the Family Business Act, supports the development of family businesses in building internal capacities and aiding them in key business activities, such as succession planning. In doing so, it provides information and applications on several Government incentives.

Last year marked its three-year anniversary.

Due to its functions, it is in touch with several family businesses around the island. Asked about whether many have contacted the Office to express concern, Dr Gerada replied in the affirmative.

“The situation being faced by family business communities worldwide is unprecedented. We have had some of our members contacting us to ask whether we shall be administering any of the incentives being offered by the Government, or whether we shall be providing new incentives to our registered members,” he remarked.

Dr Gerada added that the incentives on offer are all supported by other Government

PHOTO: JUSTIN MAMO entities and ministries. “All these incentives are also available to family business owners. Anyone who wants to find out more about these incentives should visit http://covid19.maltaenterprise.com or email covid@maltaenterprise.com or call the helpline 144 for more information,” he stressed.

In June 2020, Dr Gerada will have occupied the role of regulator for one year. He took over from Dr Nadine Lia, who was appointed Magistrate in the Courts of Malta in April 2019. Dr Gerada noted that it has been a challenging year, albeit a positive one, adding that it has been crucial in establishing the path the Family Business Office shall take in the next few years.

“Like any other process, the development of the Family Business Office and the role it must play in supporting family businesses, takes place in phases.

The first phase was a challenging one: incentives and support

measures had to be created whilst at the same time family businesses had to be encouraged to register,” he explained.

But, by the end of 2019, more than 150 eligible entities had registered with the FBO “and many of them are already reaping the fruit,” he asserted.

Shedding light on the general incentives on offer to these SMEs, even in times of ‘normality’, Dr Gerada pointed out that 2019 was a strong take-up year.

“Collectively, the global value received by family businesses over 2019 in benefits and savings exceeds the €3 million figure. This means that between 2018 and 2019 alone, family businesses have had more than €32 million left in their pockets. This value comprises all the incentives available to these entities in effecting business transfers, fiscal incentives, tax credits and governance incentives,” he said.

Incentives range from fiscal and governance to bank financ-

“Our local economy is strong enough to weather the storm and the Maltese are known for their perseverance and resilience.” ing. The first incentive launched by the FBO in collaboration with the Ministry for Finance, in 2017 was a fiscal incentive, whereby businesses opting to transfer their family business to family members would benefited from a stamp duty rate that was reduced from 5 per cent to 1.5 per cent on the uncapped value of the business.

“This was not only offered to family businesses registered with our office. However, those eligible had to fit particular criteria established by the law. This incentive was due to expire in

April 2018. However, in view of its success and take-up, the FBO promoted its continued extension. This incentive has been extended by the Ministry for Finance during each year’s Budget since, year on year, and it is still available until the end of the year 2020, unless the Government extends this incentive once again.”

Other incentives which have seen their take-up increase throughout 2019, Dr Gerada shared, are ones supporting legal, notarial and accountancy advisory services, as well as edu-

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cation and training. The former offers up to €12,500 spread over a five-year period for the purposes of assistance in succession planning, governance or the business transfer of a family business. The education and training incentive provides €1,000 annually per registered family business that attends training courses which are beneficial for the development, growth and better administration of the family business.

For Dr Gerada, public engagement on the initiatives and incentives offered by the FBO is essential to reach its goals. 2019 saw a wide-ranging awareness campaign being rolled out, as well as a change in regulator, from Dr Lia to Dr Gerada.

As the new regulator, Dr Gerada set out a public engagement and marketing plan, which kicked off with an event that took place in Gozo at the start of the year. Held in collaboration with the Gozo Business Chamber, the initiative included a presentation on the FBO’s role and on the incentives available to local family businesses, as well as the launch of the Family Business Office in Gozo, which the Gozo Minister at the time, Dr Justyne Caruana, had committed herself to establish over 2020.

The year 2020 also saw the launch of an effective Facebook campaign, through which the entity engaged with the public at large. In his efforts to keep the Office current, Dr Gerada also saw to the launch of an Instagram page: familybusinessoffice_mt.

And, these platforms have become increasingly useful in the current quagmire. “Unfortunately, due to the current COVID-19 situation, the only way we are managing to reach out effectively to the public is, in fact, through television programmes, social media and other forms of media such as printed media. We are avoiding one-to-one contact as much as possible, also in line with what the health authorities are advising,” he said.

Yet, looking ahead, he remains positive. “We hope to be able to get back soon to the implementation of our outreach programme for 2020 which should also take us to service providers’ offices where we plan to provide presentations to their employees who are the first point of contact to their clients and other business owners,” he said.

Dr Gerada elaborated further on future plans for public engagement, sharing that his Office has come to realise how many professionals – lawyers, accountants, auditors and corporate service providers – are the first

“Collectively, the global value received by family businesses over 2019 in benefits and savings exceeds the €3 million figure.”

point of contact to which business people turn when they require assistance.

“Indeed, we realised that these could be ambassadors to the FBO and, by keeping an open channel of communication with them, as well as providing them with information and knowledge, we would be able to exponentially increase our reach to the Maltese public – especially those who are already in business.”

To this end, during 2020, the entity has already started providing inhouse presentations and meetings at various corporate service providers and professional firms where it provides employees with any relevant information they would be able to pass on to their clients, he explained.

Dr Gerada stressed that since the Family Business Office is a small entity, any assistance they could receive in reaching out to the public from companies and offices is of great help. In this regard, he noted the assistance of

various entities, such as the Malta Chamber of Commerce, Enterprise and Industry, Business First, and the Ministry for Gozo, from where clients can actually set appointments with the FBO. “We would actually meet them at these locations so that we render the process as convenient and practical as possible for everyone,” he said. For, he added, alleviating some of the stresses faced by family businesses, drives the entity.

This is because, as Dr Gerada mused, it was very clear to him how most family businesses, “especially the micro ones, do not have the time nor the resources to look into our incentives and the support measures available.” He added this was the case because such businesses focus all their working time on a single objective – their business.

“Therefore, we have to make it as easy as possible for them to find out more about how we can assist and provide support to their businesses.”

PHOTO: JUSTIN MAMO

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Now is the time to implement construction industry measures – Chamber of Architects Ray Bugeja The current crisis is an opportunity to work on further reform in the construction sector, needed so that the industry can pick up on the right foot once the island emerges from the present critical situation, the President of the Chamber of Architects and Civil Engineers, Simone Vella Lenicker, has said.

“If you had asked me whether I am confident that things will get better any time soon last August, when the Government presented its letter of commitment to the Chamber of Architects, I would have immediately replied that I was more than confident that things would change. However, since then, we have passed through two periods of uncertainty, first with the political situation in the country, and, now, with the coronavirus pandemic,” she asserted.

She affirmed the urgency of implementing the proposals now, to ensure progress when the situation stabilizes. The immediate priority, she said, was to implement the points in the letter of commitment the Government presented. Among other things, the document refers to the setting up of the Building and Construction Authority; amending the Periti Act, which regulates the conduct of architects; and an overhaul of the industry.

She criticised the legal notice that came into force in June 2019, aiming at avoiding damage to third-party property, saying it was not a reform but only an attempt to address just one part of the building sector.

To remedy the lacunae, Perit Vella Lenicker said she was also hopeful the panel of experts set up by the Government will consider the study themed A Modern Building and Construction Regulation Framework for Malta released by the Chamber of Architects in May 2019 as part of its assessment, and that it will adopt the proposals made. The document refers to the absence of registration, licensing and the training of contractors and labourers, but the Chamber President said the Chamber is not aware of any progress in this regard.

In more recent developments, the panel, appointed by Prime Minister Robert Abela after the building collapse in Ħamrun in which mother-of-two Miriam Pace, 54, died, will be studying ex-

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“e Chamber of Architects has been pushing for changes to the Periti Act since 2007. e changes include additional measures that would enable it to better manage this role, empowering it to also impose additional requirements on defaulting members of the profession.” – Perit Simone Vella Lenicker, Chamber of Architects President cavation and construction regulations, among other issues. It is currently headed by retired Judge Lawrence Quintano, and includes geological and structural engineer Adrian Mifsud, construction-related court expert Mario Cassar, and lawyer Mark Simiana.

No deadline has been set on when its recommendations should be submitted. However, Dr Abela said the experts should complete their work as soon as possible.

“Every player in the industry needs to acknowledge their share of the blame for the prevailing situation, whether it is through negligence, lack of knowledge, exercising undue pressure or simply being complacent and not demanding change,” Perit Vella Lenicker said.

Indeed, all those working on construction sites, including all

professionals, should exercise due diligence in their work, placing safety at the centre of whatever they do, she underlined.

“The Chamber of Architects has been pushing for changes to the Periti Act since 2007. The changes include additional measures that would enable it to better manage this role, empowering it to also impose additional requirements on defaulting members of the profession,” Perit Vella Lenicker noted.

This need for change was reiterated by the President of the Malta Chamber of Commerce, Enterprise and Industry, David Xuereb, an architect by profession, who argued that the construction industry has been left to its own devices for long enough and it is high time to make the difference that will en-

sure a sustainable, disciplined and respectable industry operating within the norms expected of a European country, in full respect of environmental considerations and citizens alike.

It is amply evident, Perit Xuereb continued, that the laws, regulations, and systems in place, together with the supporting enforcement (or lack of it), are seriously falling short from ensuring the safety of residents, third-party properties and the peace of mind of people.

All systems need to be in place for the immediate resourcing of the long-awaited Building and Construction Authority that was meant to have started operations at the end of last year, he explained. “We are going to champion the reform. We should not wait for other tragedies to get our

act right,” Perit Xuereb insisted.

Reflecting these calls for legislative measures to be put into place, structural engineering and future-proofing buildings expert, Dr Konrad Xuereb, said the enactment of a Party Wall Act, which would reduce risks and the likelihood of third-party damage by safeguarding neighbouring properties, should be of utmost priority.

Such legislation would require the developer to appoint a party-wall surveyor to make sure all the criteria set out in the Act are followed, according to Dr Xuereb, a Director at KonceptX, an architectural and structural engineering firm with offices in Malta and London. In addition, neighbours would have the right to appoint an independent party-wall surveyor and an independent structural engineer at the expense of the developer, he continued.

Moreover, a party-wall agreement would have to be obtained, and would only be granted once all requirements identified by the third parties’ consultants are integrated in the project designs and the frequency of monitoring movement throughout the works are pre-approved, Dr Xuereb explained. The devel-

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“e industry has been left to its own devices for long enough.” – Perit David Xuereb, Malta Chamber of Commerce President oper would also have to place bank guarantees, which would be accessed by the third parties, in case of any damage.

Dr Xuereb said that while last year’s building reform was a significant step forward in the right direction, it did not address some fundamental necessities like the licensing of construction contractors against a set of minimum standards (as opposed to their inclusion on a simple register). In this regard, he called for the legal introduction of the licensing of construction contractors, possibly similar to the UK Considerate Contractors’ Scheme.

He also noted that contractors should be responsible for temporary works, like shoring and propping jobs during demolition and excavation, pointing out the sense of ambiguity which, currently, often seems to exist between the contractor and the architect in terms of who should carry ultimate accountability, Moving forward, he also asserted that, given the complex technical nature of the challenge at hand, the Government should rebalance the ratio of the members sitting on the panel of experts set up to review the laws and oversight systems governing the construction sector, possibly by adding more technical people.

“The effectiveness of this panel of experts will depend on how impartial its members are in their scrutiny of the situation and how insulated they are from the influence of powerful stakeholders who may lobby hard to protect their specific interests, which may not align with the common good of the industry and society it serves,” Dr Xuereb affirmed.

Furthermore, Dr Xuereb said that many incidents could be prevented if the contractor is obliged to produce a detailed method statement, accompanied by temporary works design and calculations well in advance of commencing construction works.

To do this, the contractor should engage a temporary-works structural engineer to design, detail and prepare drawings for all the temporary works.

The architect handling the project, Dr Xuereb noted, would still need to show that the building they are proposing can be constructed in a safe way, but the way it is actually built is ultimately the responsibility of the contractor. The project architect would remain responsible for the permanent works once the building is constructed safely.

Moreover, there must be a distinction between complex projects, like multi-storey buildings with basements deeper than one storey, and relatively straightforward projects, he said.

For the more complex projects, the architect in charge could be asked to compile a construction-method statement report that would include findings from a geotechnical investigation and a proposed sequence of construction outlining how the works will be carried out safely.

Dr Xuereb also underlined the need for a set of building regulations to be consolidated under a law, as proposed by the Cham-

ber of Architects and Civil Engineers. This would mean that no works would commence on site before building regulations approval is obtained, while a building control officer would visit the site regularly to check the main works are being carried out as documented, with the authority to stop works otherwise.

Weighing in, David Felice, Executive Director at architectural firm AP Valletta, said last year’s change in legislation, is “not a reform by any means”, and failed in its primary objective of protecting buildings and, more importantly, people’s lives.

“For too long, growth has been encouraged despite a corresponding increase in our environmental deficit. This growth is the result of the efforts of a restricted, but powerful, lobby rather than that of the communities we form part of. It is reflective of the lack of an innovative vision and reflective of a short-sighted economic vision,” he lamented.

A coordinated legislative framework continues to be ab-

sent, he continued. To this end, a set of building regulations, stemming from a strategy founded on a new environmental agenda and a programme for urban regeneration, grounded in a sustainable approach, is needed, he remarked.

He also pointed to the need for the protection of depleting natural resources (like stone) and a better built and natural environment for the benefit of society.

“Anything less than the pursuit of excellence – in a sector of such importance to the Maltese social, cultural and economic wellbeing – will lead to failure,” Perit Felice asserted.

He argued that a rethink of the building and construction industry – and Malta’s dependence on it – is overdue. Contractors must be regulated and registered, while a relevant set of building regulations and monitoring, as well as enforcement of sound construction practices should be put in place, he said.

But he underlined that things can only get better if there is

the will of all stakeholders, particularly those making up the political class and the developers’ lobby. No stakeholder in the industry can avoid responsibility for the current state of affairs but they all need to accept that change is needed, Perit Felice insisted.

“The collapse of buildings is merely the pinnacle of the problem we are facing,” he noted, suggesting that a vision and strategy for the quality of the built environment should be drawn up. “One should think less about a ‘construction industry’ and more about re-imagining the place one lives in and re-achieving attractiveness of the environment,” he said.

Perit Felice also underlined the need of a “construction platform”, bringing together all public entities and services that govern the industry, to encourage better communication and leading to the much-needed cultural change required to ensure Malta is a beautiful, healthy and safe place to live in.

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Ombudsman Planning Commissioner submits updated recommendations aiming to protect third-party property Ray Bugeja The Environment and Planning Commissioner within the Ombudsman’s Office, Alan Saliba, has recently updated his recommendations aimed at preventing damage to third-party property and, last week, submitted them to both the Prime Minister and to the panel of experts set up by the Government to review the laws and oversight systems governing the construction sector.

Perit Saliba met the panel of experts last Friday to present the nine recommendations, which revise the initial suggestions submitted almost a year ago, and which, he hoped, would be implemented swiftly. “The only recommendation [from the original set] that has been implemented to date is the publishing of information such as the method statement and the pre-construction condition reports,” Perit Saliba pointed out.

The nine updated recommendations are: the immediate setting up of the Building Construction Authority, fully equipped with resources in proportion to the size of the construction industry; deterrents through criminal procedures, fines and direct actions to restore discipline in the industry; licensing and accredited courses for all suppliers and operators supplemented by adequate building codes; the imposition on developers to employ only licensed operators under a strict subcontracting regime.

Moreover, there should be enforcement action on issues related to the Building Construction Authority, the Occupational Health and Safety Authority and the Planning Authority mustered under the one roof of the Ministry for Law Enforcement; the Authority should recognise and give priority to neighbours’ architect advice; it should assist neighbours with professional and legal advice; construction related responsibilities should be shifted from the Planning Authority to the Building Construction Authority, thus, also abetting the Planning Process; and, finally, certain planning policies that are instigating added risks in constructions sites should be reviewed.

Thus, the main aim of his recommendations, Perit Saliba explained, is to achieve three goals at once: simplifying the planning process; enhancing the built environment; and keeping in check certain legal requirements established in the Civil Code within

the control and regulatory powers of the Building Construction Authority.

Perit Saliba’s updated recommendations follow the latest building collapse earlier this month, which claimed the life of mother-of-two Miriam Pace, 54.

“What we need is a collective approach with the holistic aim of safeguarding the safety of the citizens while achieving a better environment for all of us to enjoy,” Perit Saliba noted.

To this end, in his opinion, two main issues need to be addressed.

“The first is discipline, which can only be achieved through deterrent actions such as criminal procedures when the life of neighbours is put in danger – rather than waiting for the actual incident to occur before taking any action.” In this regard, strict measures, such as clamping machinery and effectively suspending licences, should also be implemented when instructions are not followed, he outlined.

“The second is that, rather than expecting the developer’s architect to decide what to do with the neighbours’ property, it should be the neighbours’ architect who decides what the developer cannot do. The neighbours’ architect can, for example, oblige the developer not to excavate within a prescribed distance and/or not to remove any supporting walls. Then, the developer will have the option to contest this rather than vice-versa. Subsequently, it is the Authority that has to decide any dispute according to law,” he explained.

Moreover, “a system can also be introduced whereby the neighbours can choose from an approved group of architects – paid by the developers – to provide them with advice in order to avoid unnecessary expenses,” he said.

Perit Saliba leaves no doubt as to what he thinks about the building reform announced by the Government last year.

“It has failed no more than some architects failed to make sure that the Civil Code is followed and that there are no material deviations from the instructions they gave. It has failed no more than some contractors failed to observe the rules of the art and the trade in the execution of the works according to the architects’ directions. And it has failed no more than the way we all failed in tackling the way our country is being concreted and public/rural areas occupied for the sake of commercial gain and economic growth,” the Environment and Planning Commissioner stressed.

“What we need is a collective approach with the holistic aim of safeguarding the safety of the citizen.” – Alan Saliba, Ombudsman’s Office Commissioner for Environment and Planning Furthermore, he advocated for court action to be taken by citizens suffering at the hands of developers, saying that people worried about construction work should institute legal procedures for a prohibitory injunction to prevent damage to their thirdparty properties.

“The way things are, citizens who are living quietly in their

home have only one effective avenue to follow when heavy machinery starts closing in.

They should initiate legal procedures for a prohibitory in-

junction to prevent the developer from carrying out certain works that would compromise their property,” Perit Saliba said.

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Surreal Vincent E. Rizzo

It has taken me days thinking about how and what to write, given that the difference between the time of writing and the time of publication of these articles may seem an eternity in the current surreal circumstances where conditions are changing by the hour! Furthermore, writing about the inevitable and pretending to know more at a time where news flow, statistics and fresh information are being splashed out quicker than it takes us to wash our hands, makes the timing of this month’s article a harder one than most.

Nevertheless, in an attempt to stick to what we hope to know

better, today’s write up will focus on the ‘what next’ in the context of capital markets. What next?

Most definitely volatility and uncertainty. That is an undebatable fact, at least in the short term and – dare I add – medium term too.

There is nothing that markets dislike as much as uncertainty.

And, at this point, it is hard to see how uncertainty could be greater. The world’s major economies (and Malta too, naturally) have voluntarily and responsibly, I’d say, temporarily shut down large tracts of activity.

They have effectively chosen to impose a recession (or almost) upon themselves, correctly judging that this is preferable to allowing the pandemic to do its worst and to prolong the damage. Quick containment is key and health comes first, and that’s the way it should be. So, at the time of writing, markets quickly scrambled to price in recession or are heading there fast. This is understandable and correct – at least in the short term.

Within this correction process, volatility has understandably also reigned as investors struggle to deconstruct the full effect of

“We need to stop, think and appreciate that what we had and what we lived through is indeed the past, at least for now.”

the COVID-19 disruptive onslaught on the global economy.

Malta is no different. The speed with which all is unfolding is indeed remarkable and governments the world over have been quick to react, and quite rightly too. Last week, US Treasury Secretary Steven Mnuchin indicated that the White House was looking at giving direct cash payments to Americans as part of a

massive economic stimulus package of around $850 billion which it hopes could halt the economic free-fall caused by the virus. In Europe, following an emergency policy meeting also held last week, ECB President Christine Lagarde commented that “extraordinary times require extraordinary action”.

Doesn’t this remind us of Draghi’s reference to “we will do all it takes” in 2012? Malta, too, has been relatively quick to react, although, at the time of writing, it remains to be seen how effective Government’s proposals will be, particularly when seen in the light of the initial reactions from the business community as represented by various associations and bodies. Indeed, it would seem that Malta’s initial response is far from what the economy requires.

However, despite the times being indeed extraordinary, we will return to normality. Sooner rather than later. In the meantime, though, we have to think of whether normality will be just like what we have been used to or whether it will be something completely new. I think we need

to quickly forget the relatively ‘easy’ recent past. We need to stop, think and appreciate that what we had and what we lived through is indeed the past, at least for now. While remaining positive all along, it is imperative that we draw the line and now look to rebuilding, step by step, in a reasoned, prudent and riskadjusted manner. In just a month, outlooks will need to readjust materially for most. Will companies be willing to continue to assume the same levels of risk as in the recent past? Will investors continue to assume and pretend that risk means very little?

I am convinced that the future remains bright. Markets will bounce back – some naturally much quicker than others. And some sectors, quite understandably, will perform much better than others. But isn’t this always the case? They did so in 1987, 2003, 2009 and 2011, and they will do it again now. Naturally, the time to recovery was different in each circumstance. What is different this time some may ask?

One of many highly informative articles published online re-

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STOCK MARKET REVIEW

cently contained a remark by Goldman Sachs in which it was opined that this is a health and confidence crisis, and not a financial one. The argument is that, unlike in 2008, banks worldwide are generally in much better shape now than they ever were, with healthy balance sheets and strong capital and liquidity ratios.

The article also mentions that economic fundaments generally remain sound and that most governments have announced aggressive and drastic support measures. This will help. Finally, the reality is that the same way the pandemic came, the passage of time and, hopefully, a medical breakthrough will help it subside.

It is just a question of time. Advancements in healthcare, globally, over the years have been remarkable and the world has what it takes to stop this just as it also did in the past. Resources are plentiful.

You may think I am being overly optimistic. It is naturally impossible to judge the exact timing of recoveries – as is always the case – but evidence suggests that, beyond the short term understandable emotional stresses all this has brought upon us, the world will overcome. Inevitably, there will be some fallouts. Hard as it is to say so, some companies and sectors may not manage to survive the sudden complete halt to their revenue streams for too long un-

“Markets will bounce back – some naturally much quicker than others.

And some sectors, quite understandably, will perform much better than others.”

less a sufficient cash/liquidity buffer is in place. This is a stark reality that we cannot ignore but, then again, it is here that we need governments the world over to understand that what can be done should be done as mass layoffs will be the next to haunt.

In times of massive market volatility such as these, more often than not, the best course of action for investors is to stay put.

Ignore the noise, although it is, indeed, deafening at times! We just need to get comfortable with being uncomfortable. At least for the time being. It is impossible to time the temporary peaks and troughs, especially as the market’s direction may not always follow what theory suggests. As long as one is adequately diversified, principally by sector, then the temporary hit should be rel-

atively cushioned. So, hang in tight. The worst may still haunt us, but we will look back in a few years and wonder how we missed this opportunity of at least a decade (in some cases) to buy great companies at unbelievable (till only four weeks ago) prices.

Once again it is imperative for investors to understand that fundamentals will always prevail.

How strong are the company’s major shareholders? How much does a company generate in cash earnings? How leveraged is its balance sheet? What is it principally composed of? Does it have access and room for further external financing to support short term liquidity crunches such as these? While all are being hit, and will continue to feel the blow for some time to

Rizzo, Farrugia & Co. (Stockbrokers) Ltd, “Rizzo Farrugia”, is a member of the Malta Stock Exchange and licensed by the Malta Financial Services Authority. This report has been prepared in accordance with legal requirements. It has not been disclosed to the company/s herein mentioned before its publication. It is based on public information only and is published solely for informational purposes and is not to be construed as a solicitation or an offer to buy or sell any securities or related financial instruments. The author and other relevant persons may not trade in the securities to which this report relates (other than executing unsolicited client orders) until such time as the recipients of this report have had a reasonable opportunity to act thereon. Rizzo Farrugia, its directors, the author of this report, other employees or Rizzo Farrugia on behalf of its clients, have holdings in the securities herein mentioned and may at any time make purchases and/or sales in them as principal or agent, and may also have other business relationships with the company/s. Stock markets are volatile and subject to fluctuations which cannot be reasonably foreseen. Past performance is not necessarily indicative of future results.

Neither Rizzo Farrugia, nor any of its directors or employees accept any liability for any loss or damage arising out of the use of all or any part thereof and no representation or warranty is provided in respect of the reliability of the information contained in this report. © 2020 Rizzo, Farrugia & Co. (Stockbrokers) Ltd. All rights reserved

come, it is these companies that will survive and bounce back first. This is precisely the reason why investors need to be very careful at all times and not underestimate risk. And regulators

have a role here too, now more than ever!

Vincent E Rizzo is a Director at Rizzo, Farrugia & Co (Stockbrokers) Limited

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March 26, 2020

BUSINESS UPDATES

An overview of Government measures to aid businesses, administered by Malta Enterprise As we enter a new phase of the COVID-19 outbreak in Malta, Government is keeping a constant eye on the situation as we want to further address the impact on businesses, and, particularly, small businesses.

The actions being taken by the public health authorities are necessary and important. While the individual risk from the COVID19 novel coronavirus is low, the potential societal impacts are substantial. Social distancing will slow the spread of the virus and allow medical personnel and facilities to more safely and effectively treat those who are infected and require hospitalization.

Government, too, has had to reduce face-to-face contact for its client facing offices and most businesses are being encouraged to utilise e-government services whenever possible. Luckily Malta is one of the most advanced countries in Europe when it comes to eservices. Most of these services, in order to ensure the identity of the applicant, can be accessed via e-ID. Whilst the health authorities and Government officials are working together to maintain our safety, security, and health, businesses are encouraged to do their part to keep their employees, customers, and themselves healthy.

That having been said, it is a fact that businesses are feeling the pain, and we want to do everything we can to help. There is no sugaring the pill. Facing total closure for health reasons, or decreasing revenues, particularly in consumer-facing sectors, some businesses, mostly SMEs, might not have the financial headroom to survive. Without help from Government some businesses will be forced to close their doors whilst employees risk losing their jobs – a situation that no one wants.

Malta Enterprise, on behalf of Government, has been given the important task of coordinating a package of measures aimed at alleviating the hardships on businesses.

These measures include: The Teleworking Scheme – this call supports employers/selfemployed to invest in technology that enables teleworking and to partially cover the costs of teleworking solutions; The Quarantine Leave Scheme – a grant of €350 per employee to businesses (including self-employed) that had full-time em-

ployees on mandatory quarantine leave; Tax Deferment – this incentive gives a two-month extension to enterprises, including the self-employed, to pay provisional tax, VAT and national insurance contribution on salaries. This will apply for taxes owed until end of April. More information on this scheme is included in the caption.

Government is also helping with the payment of wages: Full time employees of enterprises operating in sectors that suffered drastically due to the COVID-19 pandemic or had to temporarily suspend operations on the order of the Superintendent of Public Health will be entitled to up to five days’ salary based on a monthly wage of €800. This includes all self-employed. Part-time employees will be eligible up to €500 per month;

“Malta Enterprise, on behalf of Government, has been given the important task of coordinating a package of measures aimed at alleviating the hardships on businesses.”

Full time employees of enterprises in other adversely affected sectors, including wholesale, manufacturing and warehousing will be entitled to one day’s salary per month. Part-time employees will be eligible to one day’s salary per week, equivalent to €100 per month. In the case of Gozo based enterprises this will increase to two days’ salary per

week equivalent to €320 per month for full time employees, and €200 per month for part time employees; In case of self-employed in other adversely affected sectors who have employees, they will be entitled to two days’ salary per week equivalent to €320 per month; Self-employed based in Gozo operating in other adversely af-

fected sectors will be entitled to two days’ salary per week equivalent to €320 per month. This will increase to three days’ salary, equivalent to €480, for those selfemployed who employ staff, and the employees will be entitled to two days’ salary per week.

More details on the wage supplements, including the list of sectors, can be found on covid19.maltaenterprise.com.

Government has also introduced a number of measures for employees. These measures are being administered by the Social Security Department and more information can be found on the website www.socialsecurity.gov. mt/covid19benefits.

The ultimate magnitude of the shock to the world economy is still unknown but we know for sure that businesses across a number of sectors are going to be challenged whether it’s because of total closure, decreased demand, significant disruptions on supply chains or overall weaker economic activity across the globe. A few weeks ago, Malta was passing through an unprecedented economic boom and the main problem employers had was finding adequate staff to sustain the growth of their businesses. The situation has changed completely, not just for Malta but all over the world, in a matter of days. We are an open economy and what happens abroad has a direct effect on our economic activities.

And the situation is evolving and changing every day.

These measures are, therefore, constantly being reviewed as Government is keeping a close eye on both the health and economic situation both here and abroad, and is holding frequent consultation meetings with the representatives of both employers and employees.

Further information on these measures, or any other measure announced by Government, can be found on our dedicated website covid19.maltaenterprise.com.

Those businesses that require further information on these measures are urged to call 144 or send an e-mail to covid@maltaenterprise.com.

Malta Enterprise has also extended the deadlines of some of its schemes such as the Microinvest Scheme for Self Employed, which has been extended to 30th April 2020 and the Gozo Transport Scheme which has been extended to 3rd June 2020.

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BUSINESS UPDATES

Enemed: a lifestyle brand The recent brand ambassador campaign by Enemed pushes the brand and the lifestyle it offers on land, at sea and in air, by collaborating with a mixture of individuals with various personal and professional backgrounds that represent these three pillars. These collaborations do not only reflect Enemed’s customers’ needs and wants, but they provide a front row seat to their technical requirements, allowing for information to be relayed back to the lab to enhance the fuel.

Representing ‘land’ is none other than drifting champion Andrea Fabri, who started his drifting career in 2014 and has been collaborating with Enemed since 2017, showing us, on several occasions, how a

good and reliable fuel can go the extra mile.

Representing ‘sea’, and with five world powerboat championship wins under his belt, a state-of-theart powerboat factory and a UIM recognised Powerboat Championship, Aaron Ciantar needs no introduction and is one of Enemed’s biggest collaborations, one which opened the doors to an adrenaline sport: the Powerboat Championships.

Standing in for ‘air’, it was with no coincidence that Enemed chose Airborne TV Series’ star, Clare Agius, who has quite a colourful portfolio, and who has worked as a pilot, TV presenter and producer, as well as an environmental advocate.

Enemed’s lifestyle is each and every one of us!

FIMBank announces USD7.3 million pre-tax profit for 2019 The year 2019 was another profitable year for FIMBank. The FIMBank Group’s Consolidated Audited Financial Statements show that, for the year ending 31st December 2019, the Group registered a pretax profit of USD7.3 million, compared to a profit of USD13 million in 2018.

The overall financial performance of the Group reflects the execution of a derisking process resulting in short-term asset reductions positively improving the risk profile of the key portfolios. Following the conclusion of this process, the Group strengthened the structures of its credit transactions. The period under review, saw FIMBank absorbing most of the derisking outcome in its core trade and commodity finance portfolio, with the consequent impact on interest and fee revenues. It is also important to mention that during the year, the bank received dividend income from a subsidiary undertaking which reduced its accumulated losses to significant levels when compared to prior years.

The Group’s ‘Net operating income’ dropped by 13 per cent from USD58.7 million to USD51.3 million. Net interest income, net fees and dividend income

combined together decreased by 14 per cent, from USD56.5 million to USD48.4 million. Revenues dropped due to a combination of certain measures implemented by the Group and economic conditions. Despite having faced a challenging year, the bank remains committed to its strategic focus and the transformation of the Group to one based on a culture of excellence, sustainable growth and long-term returns.

“We have been prudent in addressing the challenges from a slowing economy and reducing trade finance momentum which may bring with it potential asset quality issues if we are not careful. This has meant slower growth, and more prudent provisions while focusing on strong governance,” said Murali Subramanian, Chief Executive Officer of the FIMBank Group.

In-depth review of the Financial Statements shows that it was a challenging year for the Group, marked by a number of non-performing exposures in FIMBank and India Factoring, leading to an impairment coverage increase of USD14.2 million on legacy and new delinquent exposures. Nevertheless, the Group also managed to improve its risk profile across

a number of non-performing exposures which ultimately resulted in reversal of impairments. The Group’s management team is spearheading several efforts to address these exposures and recoveries are expected to accelerate in the near future.

This is underlined by the recent engagement of a specialist Head of Recoveries to manage the impaired assets of the Group.

Reflecting on FIMBank’s performance in 2019, Group Chairman Dr John C. Grech stated that the bank’s “senior management team has proven decisive towards ensuring that the Group continues to respond to future challenges effectively, and to secure a more sustainable growth trajectory for FIMBank in the coming years. More specifically, measures undertaken during this period have led to the critical transformation of the underlying portfolios of the Group, the result of which places FIMBank in a position of strength, as it makes its business model fundamentals even more sustainable and attractive.”

Dr Grech also made reference to the celebration of FIMBank’s 25th anniversary during that year, saying that “this milestone in FIMBank’s history was an opportunity for my Board and Management to

determine where we are heading, keeping in focus our mission. Over the years, FIMBank has established itself as a leading provider of trade finance, factoring and forfaiting solutions, and more recently, selective real estate financing. There is no doubt that our employees and management at head office and across the globe, deserve our praise for the results which have been registered over these past years.”

For further information about FIMBank, visit www.fimbank.com

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March 26, 2020

BUSINESS UPDATES

HSBC Malta introduces measures to support businesses affected by coronavirus HSBC Malta has introduced a number of measures to support businesses which may be negatively affected by the novel coronavirus (COVID-19) outbreak. These measures, which have already come into effect for those businesses which meet HSBC Malta’s credit criteria, include: capital repayment holidays; fee free temporary short-term working capital funding; faster turnaround on issuance of

shipping guarantees and the waiver of urgency fees; as well as the waiver of amendment fees on Letters of Credit impacted by delays.

Joyce Grech, Head of Commercial Banking at HSBC Malta said, “the outbreak of the coronavirus is having a significant impact on the global economy and, of course, Malta is also being affected. Throughout this challenging pe-

riod, particularly for businesses in certain sectors, HSBC Malta is determined to do what it can to provide the support our customers need. As the situation develops, HSBC Malta will continue to monitor the situation and to assess what further measures may be necessary.”

HSBC Malta commercial customers who feel they require support due to the

impact of the novel coronavirus on their business, are asked to contact their Relationship Manager, who will be able to provide guidance on the next steps. Each request for support will be considered on a case-by-case basis.

Further information is available at www.business.hsbc.com.mt/en-gb/mt/ generic/important-announcement

Heritage Malta opens virtual doors to its cultural sites A few days ago, just as the sun was about to rise, 7,000 viewers experienced the annual Spring Equinox as seen from the Mnajdra Temples, thanks to Heritage Malta’s live stream of the event which was hosted by curator Katya Stroud. Till now, the number of visitors has increased to 27,000 and counting, as per the National Agency’s Facebook page.

This event was one of Heritage Malta’s many creative initiatives catering for the ongoing COVID-19 pandemic, which include virtual accessibility to national museums and sites that are temporarily closed.

“Our initiatives aim to nourish a sense of hope, particularly through the presence of prehistoric sites that have survived adversities over thousands of years,” explained Noel Zammit, Heritage Malta’s CEO. “More than ever, such moments help us to understand and appreciate the value of sites which have been recognised as UNESCO World Heritage Sites.”

A collaboration between Heritage Malta and the tech-giant Google is now giving internet users the unique opportunity to vir-

tually visit several of the Agency’s national museums and sites through the online platform Google Arts & Culture https://artsandculture.google.com This collaboration brings our cultural sites at par with other major international institutions, including the Musée d’Orsay in Paris, the Van Gogh Museum in the Netherlands, the National Gallery of Arts in Washington, Museo Frida Kahlo in Mexico, the Victoria and Albert Museum in London, and many more.

Virtual tours will immerse the viewer into the solemn grounds of the Ħal Saflieni Hypogeum; walk you along the unique artefacts exhibited at the National Museums of Archaeology in Malta and Gozo; impress you with the exquisite colourful mosaic floors at the Domvs Romana; or accompany you through the turbulent times of the Second World War, at the National War Museum in Fort St Elmo.

Heritage Malta invites the public to open these virtual doors to amazing discoveries, and to strive to visit them personally once the ongoing troubles are over.

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NEWS

Malta Business Who’s Who 2020 – Malta’s largest publication, celebrates leading entrepreneurs Malta Business Who’s Who 2020, a 412-page compendium featuring a large number of businesspeople, professionals and people in management, with the aim of facilitating business connections and networking, was successfully launched by Content House Group in February. The launch of the publication follows the successful launch of WhosWho.mt in January, a business portal focusing on people in business and companies operating in Malta.

The portal was an instant success with the business community, registering a strong daily readership, as well as instantly seeing its global and local ranking rapidly improving.

The publication, which has a 12month shelf-life and features a rollcall of established business heavyweights, people in management, professionals, as well as upand-coming innovators, who are making waves in sectors as diverse as financial services, logistics and the public sector, was created by an experienced business editorial team as well as the company’s business development division.

Content House Group is one of Malta’s leading media organisations, producing over 20 successful online and print brands across a variety of genres. These include WhosWho.mt, MaltaCEOs, GuideMeMalta.com, gwida.mt, The Malta Business Observer, iGaming Capital, Style Magazine, Business Agenda, OurWedding.mt and Bliss Magazine, among others.

Easy to navigate, Malta Business Who’s Who 2020 includes thousands of business profiles, presented in alphabetical order, sorted by surname, with an index at the back categorising the entries by industry and company. In this way, the publication lends itself as a reference tool for professionals and potential clients alike.

The release of this 2020 issue follows swiftly on the success of the online portal WhosWho.mt, a business networking engine and business news portal, launched this January. Raisa Mazzola, Head of Digital and Marketing at Content House, pointed to the portal’s steady engagement and its rise in the local and global ranking system.

“Over the last two months, the portal’s global and local ranking has surpassed our expectations in every way. People immediately responded to the site, and engagement on our socials was instant. There was a lot of anticipation for the launch of WhosWho.mt, as well as the pub-

“Over the last two months, the portal’s global and local ranking has surpassed our expectations in every way. People immediately responded to the site, and engagement on our socials was instant.” – Raisa Mazzola, Content House Head of Digital and Marketing lication itself, so naturally our audience and reach started off strong,” she said.

And, in February and March, the number of visitors to the portal kept on increasing, as fresh stories, daily announcements and business/company profiles were published on the website, shedding light on the developments forging the local business world. “The site gained instant popularity and the requests from business professionals within various industries have been very encouraging,” Ms Mazzola continued. “Feedback in general has also been extremely

positive and it is clear that people want to be part of that which we have created.”

Looking forward, both WhosWho.mt and the Malta Business Who’s Who 2020 aim to keep delivering local business news related to people in business and to locally operated companies, and supporting established firms, as well as new ventures, in meeting the challenges of an ever-evolving local economy and society while remaining up-to-date on the situation on the ground.

For more information, get in touch on info@contenthouse.com.mt.

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March 26, 2020

BUSINESS UPDATES

What happens when your AML transaction monitoring rules are outdated Although we live in a cutting-edge, modern tech world, a large number of payment service providers still use outdated, static systems to flag and identify suspicious transactions and payments. Remedying false positives can be a colossal waste of your team’s time. The situation can also lead to customers’ legitimate transactions being delayed while the team is handling and reviewing possible false positives. Given these facts, it is no surprise that a decade-old flagging system is no longer feasible for a number of reasons.

are still being used. Static rule systems are slow to adapt, become quickly outdated, and have become increasingly predictable. These factors make it quite easy for criminals to hide their true intentions and mask transactions under the pretence of legitimacy. Likewise, with new rules and regulations put into place at an increasingly quicker rate, it is easy for an organisation to become non-complaint if it does not adhere to these latest laws. All this means increased costs through fines and more expenses incurred in the updating of legacy systems.

TOO MANY FLAGGED TRANSACTIONS

SOLUTIONS TO THE PROBLEM

Most systems still use the static rules principle, which means that the system does not adapt to new rules but follows a stringent pre-defined list of criteria. This frustrating factor leads to transactions being flagged as suspicious because of their unique and modern signature. Obviously, if the signature is not found in the old processor’s list, it will be marked as a false positive, putting the expensive burden of review on the compliance team. Apart from being costly, a long review process increases operational costs, frustrates genuine customers and puts the company’s Anti Money Laundering (AML) compliance at risk.

Fortunately, solutions do exist for these modern-day issues. For instance, AI-driven transaction monitoring enables organisations to stay ahead of the curve and always be compliant with new laws, while simultaneously improving customer experience. These systems have the capability to learn ‘on the job’ through continuous monitoring, inspections, and analytics – they actually get smarter. This means that, now, criminal transactions can be identified more frequently and accurately as the system will have recognised the signatures used before and it would have also intercepted the transaction as suspicious.

INNOVATIVE CRIMINALS TAKE ADVANTAGE

HOW COMPLYRADAR CAN HELP

Criminal exploits are made easier when old systems, using extremely rigid rules,

ComplyRadar helps you address AML transaction monitoring requirements by automatically identifying suspicious be-

haviour in real-time or on a scheduled basis, while minimising false positives. It monitors transactions related to individuals, accounts, and entities to detect suspicious activity quickly and effectively, through a fully audited process to inspect

and act on flagged transactions. For more information on how ComplyRadar enables you to fulfil your AML obligations whilst nurturing your genuine customers, visit www.comply-radar.com or email info@computimesoftware.com

GO proactive with precautionary measures amidst COVID-19 outbreak In view of the recent developments regarding the COVID-19 virus outbreak over the past weeks, GO plc has been proactive in implementing precautionary measures in the interest of its employees and esteemed customers.

In this regard, GO informs the general public that the outlet at Bay Street shopping complex is closed until further notice. Other outlets have been decked with protective equipment and staff have been trained on all relevant health and safety practices.

Ensuring that our customers remain connected remains our top priority. However, we have a huge responsibility towards our employees, as well as to our customers, and to the community – a responsibility which we take very seriously.

We have been very proactive in implementing recommended best practices as the situation has evolved and we keep taking every measure possible to minimise disruption and maintain the same level of service to our customers as much as possible.

For more information visit www.go.com.mt