Author: SME Chamber

The Parliament Economic and Financial Affairs Committee discussed the situation in Libya.

Mario Debono, GRTU Council member with years of experience in doing business in Libya, explained GRTU’s position on Libya to the Committee.

GRTU had members who were and still are heavily dependent on Libya business. In fact, many small businesses, even single member businesses, are now finding it difficult to survive.

GRTU’s members that have been actively involved in Libya are in retail, wholesale, services, remanufacturing, re-exports and IT. They have been hit hard because most of them depend on Libya for a large amount of their income, but also because they do not have the diversification and resilience of bigger companies. Mr Debono stated that GRTU would like to further engage with Malta Enterprise formally to continue assisting its members in this regard.

Mr Debono stated that GRTU has very good contacts in Libya, both in the east and in the west. Although the situation is dire and fluid, yet recent political developments and dialogue between the warring parties give rise to some hope for a settlement in the medium term.

Mr Debono also highlighted problems that businesses are facing, because many businesses are still supplying their clients with goods and services, albeit at a reduced rate. There are issues of security.

Maltese businessmen are still going to Libya on the daily flight, however there is a risk of kidnap for ransom in Tripoli, much less so in more orderly Misurata. Tobruk and Benghazi are unreachable unless with great difficulty.

Despite difficulties like exorbitant flight prices, the difficulty in changing Libyan currency to Euros for payments and repatriation, amongst many others, the legendary resilience and entrepreneurship of the Maltese businessman is still evident in companies and entities dealing with Libya. GRTU feels the time has come for these people to be given attention and relief, especially on tax and other payments.

There is also an issue with visas. There is great difficulty where Maltese business people request visas for their Libyan partners. Visas are being issued for health reasons, but nothing else. This is in great contrast to other EU countries like Greece, Spain, Italy and France that routinely issue Schengen visas to Libyans applying in Tunisia. It is obviously safer for Maltese businessmen to meet their business partners in Malta, but for some reason the Maltese Government is being reticent in the issue of visas

GRTU feels that Libyan partners should be issued a normal Schengen visa, not a special visa only valid for Malta. Yet any effort in this regard is a step in the right direction and GRTU will engage with the Ministry of the Interior on this issue. We cannot give the message that Libyans are second class people when we give them a visa. Other countries will get the business simply because they are treating them better.

Whilst GRTU appreciates the need to help its members diversify into other markets and not rely solely on Libya, which is currently a main focus of Malta Enterprise, we feel that things will get better in Libya.

This is our closest neighbour with historical and family ties going back centuries. It’s also a vast country with just 6 million people and vast resources, and not just oil.

GRTU feels that once things settle, the opportunities will come back, because even in these troubled times, people are still doing business. A presentation delivered by Malta Enterprise outlined 36 million in exports in the first quarter of 2015.

GRTU will continue its work with small businesses to help them overcome these troubled times in Libya.

 

GRTU Executive Elaine Zammit has attended an EU funding information session organised by Europe Direct Central region, one of the three Europe Direct Information Centres situated in Malta and Gozo. This event focused on various funding schemes that would assist in financing SME projects.

The funding programmes presented during the information session which targeted SMEs are listed below:

Interreg Med 2014-2020 programme

This programme will mainly focus on alliances that will create exchanges, increase communication and share knowledge and experiences between the projects.

This scheme centres on the development of a new and innovative public intervention to reach three successive phases which are:

• A phase of study and development of strategies and policies;
• A phase of testing, to validate the hypothesis developed;
• A phase of transferability and capitalisation of results at the transnational level.

The funding programme will have three different modules which are defined by:

• Module 1: Studying
• Module 2: Testing
• Module 3: Capitalising

A project can be composed by one or several modules depending on its strategy and main objectives, expected results, competences and experience of the partnership.

The projects must also fall under three priority axis. These include:

Priority Axis 1: Promoting Mediterranean innovation capacities to develop smart and sustainable growth.

Specific Objective 1

• To increase transnational activity of innovative clusters and network of key sectors of the MED area;
• Total amount for this call in S.O.1 is €24.3 M (ERDF).

Priority Axis 2: Fostering low-carbon strategies and energy efficiency in specific MED territories: cities, islands and remote areas.

Specific objective 2.1:

• To raise capacity for better management of energy in public buildings at transnational level.
• Total amount for this call (ERDF) €8.6M.

Specific objective 2.2:

• To increase the share of renewable local energy sources in energy mix strategies and plans in specific MED territories (islands and rural areas).
• Total amount for this call (ERDF) €8.6M

Specific objective 2.3:

• Increase capacity to use existing low carbon transport systems and multimodal connections among them.
• Total amount for this call (ERDF) €9.8M

Priority Axis 3:Protecting and promoting Mediterranean natural and cultural resources.

Specific objective 3.1:

• To enhance the development of a sustainable and responsible coastal and maritime tourism in the MED area.
• Total amount for this call is (ERDF) €13.7M

Specific objective 3.2:

• To obtain biodiversity and natural ecosystems through strengthening the management and networking of protected areas.
• Total amount for this call is (ERDF) €11.45M

The first call will be open on 17^thJune 2015 and the call envisaged to remain open for 4 months.

 

ENPI CBC MED Programme 2014-2020

This transnational cooperation programme aims to foster a fair, equitable and sustainable economic development; improve social and territorial development for cross-border integration; Valorise participating countries’ territories and value.

The overall objective of the programme is to:

• Promote economic and social development;                    
• Address common challenges in environment.

 

Thematic objective 1: Business and SMEs development

The main aim is to create economic opportunities and jobs to reduce high rates of unemployment through the following priorities:

• Supporting innovative start-ups;
• Euro-Mediterranean value chains;
• Diversification of sustainable tourism.

Thematic objective 2: Support to education, research, technological development and innovation

Innovation is essential for the competitiveness and productivity of Mediterranean economies and is to be enhanced via the following priorities:

• Technological transfer and commercialisation and research results;
• Supporting SMEs in accessing research and innovation through clustering.

Thematic objective 3: Promotion of social inclusion and fight against poverty

This priority will address:

• Providing young people with marketable skills;
• Supporting social and solidarity economic actors.

Thematic objective 4: Environment protection, climate change adaptation and mitigation

This theme seeks to achieve a more sustainable Mediterranean region by enhancing efficiency in waste, water and energy management, together with the conservation of coastal areas through these priorities:

• Efficient water and waste management;
• Renewable energy and energy efficiency
• Integrated Coastal Zone management.

Through this programme you will be able to partner up with not only entities from EU Member states but also from other countries such as:

First calls for project proposals will be launched in the early months of 2016.

  

Italia-Malta programme

The aim of this programme is geared towards strengthening cooperation between Malta and Sicily. The programme contains four priority axis:

Priority Axis 1:

• Strengthening the development of Research & Innovation with 30% of the programme budget amounting to circa €13M.

Priority Axis 2:

• Facilitating the creation of new businesses and SMEs;
• Facilitating the mobility of labour and the creation of new jobs.

Priority Axis 3:

• Protecting natural heritage, more specifically protecting the marine and terrestrial biodiversity;
• Developing technological systems aimed at mitigating anthropological and natural risks with a particular reference to marine disasters.

Priority Axis 4:

• Providing technical assistance for the management of the programme (these funds are available primarily for the Managing Authority and the FPD).

 

 

 

In a meeting hosted by MEUSAC, H.E. Artis Bertulis, Ambassador of the Republic of Latvia to Malta, presented developments on the priorities of the Latvian Presidency with government stakeholders and social partners. The priorities of the Latvian Presidency ending on 30th June focus on:

Competitive Europe

• Reached an Agreement in the Council on the European Fund for Strategic 

  Investments

• Commenced the process for establishing an Energy Union
• An agreement has been achieved on the EU’s contribution to the new global climate agreement
• An agreement has been achieved on measures supporting a fully functional Single Market
• Concluded the first phase of the European Semester 

Digital Europe

• Achieved significant progress in legislation related to the digital sector
• Reduced mobile phone roaming fees
• Data protection partial agreement on new legal framework
• Network and Information Security Standards

Engage Europe

• Agreed on measures for strengthening EU internal security
• Highlighted external security-related European issues
• Held events in preparation for the Eastern Partnership Summit
• Decisions take on supporting Ukraine
• Advanced negotiations on the Transatlantic and Investment Partnership
• Contribution made to international negotiations on the new post-2015 sustainable development goals

During this stakeholders’ meeting, GRTU commented on how security and migration issues may have over-shadowed the priorities of the Presidency with both matters effecting Malta directly. Security in Eastern Europe effected European energy policy and even closer to home, the instability in Libya effecting Maltese businesses directly. Migration is indisputedly high on Malta’s agenda, especially with recent human tragedies happening in our waters.

GRTU highlighted the importance of developments in the energy sector which effect Malta’s businesses in terms of price stability and stress on Maltese businesses. In terms of initiatives on a digital front, GRTU outlined the importance on a national level. E-commerce and digital marketing are key upgrades which Maltese businesses, particularly in retail, need to take. The infrastructure is solid but its usage is still weak. Business models need to adapt faster to the phenomenon of online business since customers are going this way. GRTU also queried about developments on the Juncker Plan which has brought a new goal to the European Union and its economy, which however now needs to be translated into effective initiatives which are watered down to the benefit of our small and medium enterprises.

 

The Ministry for Social Dialogue gave a presentation on the proposed method of implementation of the Maternity Leave Trust Fund as had been put forward in the Budget 2015 Speech. The aim is to make engagement in the private sector more gender neutral through this fund which is intended to pay the 14 weeks paid maternity leave.

This fund shall be financed through contribution by private companies. The 

premium contribution has been calculated at 0.3% of the basic wage of all employees to be collected to finance the provision of maternity leave in the private sector. The computation of the 0.3% has been based on the number of females engaged in employment, the annual basic wage, probability of maternity, probability of females who stop working before/during/after pregnancy and the number of female employees working in public sector. The revenue has been based on the total employers’ contribution with maternity leave as a percentage of wage bill.

The Trust Fund should be administered through the setting up of a Board of Trustees and overseen by the social partners. The Board of Trustees is envisaged to have a strong representation of employers’ organisations represented on MCESD, with the chairman being proposed to be an employers’ representative.

The proposal included that the system will be based on 3-month, 6-month or 12-month reimbursement system (which is yet to be established) to the employer having paid out the maternity leave following a request for refund. The Trust Fund will be effective upon an issue of the relevant Legal Notice which is envisaged for 2015. The contribution rate may be revised after two to three years.

During the meeting, GRTU described the proposal as positive in principle since it will further decrease negative preconceptions on women’s employment and career prospects. There are other concerns for employers such as the need for replacing the skills during maternity leave, but this alleviates the financial burden.

GRTU outlined that since the collection of the fund is envisaged to be linked to the collection of employers’ National Insurance Contributions, this should not develop into a precursor for future increases of imbalance on NI contributions against the employer. GRTU also outlined the fact that as a by-product of this fund, employers in female-dominated sectors shall benefit at the expense of employers in male-dominated sectors. It also has to be assured that the system does not incur additional unneccessary burdens on employers to implement this, such as expenses for payroll software.

GRTU also inquired whether the public sector will be involved in the fund since this may lead to situations where the bill for the private sector will be proportionally less and private employers might end up making up for the public sector. GRTU was assured that the public sector will not be included in this fund and will continue to pay its employees on maternity leave directly.

GRTU emphasized that the reimbursement system will create unneccessary cashflow concerns on employers which can easily be avoided if the scope of this system is to be reaped – otherwise employers will still see a financial burden of having women out on maternity leave, until the reimbursement is paid. This would also result in employers having to go through elaborate procedures and administrative processes. Therefore GRTU shall continue stressing that any form of repayment or reimbursement should be passed on to employers with immediate effect upon payment to the mother in question.

 

EuroCommerce held its Social Affairs Committee Meeting and a Social Dialogue Meeting for the Commerce Sector bringing together representatives of both employers and workers on the 12^thand 13^thMay, in Brussels.

EuroCommerce gave details about a number of projects it will be participating in the fields of social dialogue, retail and commerce. One of the projects is looking into healthy and safety at the place of work focusing on ergonomics, stress at work and psychosocial risks. The project will also produce a country fiche with elaboration on national case studies. Another project is focused on holding a detailed fact-based study on the current 

scenario on the commerce sector covering retail, wholesale, international trade and e-commerce. The project idea is to produce a study which looks at the challenges in the EU commerce labour market taking into account the fast evolution in the sector to be able to understand them and pre-empt solutions.

UNIEuropa and EuroCommerce jointly approved a common document pledging quality apprenticeships showing the commitment of both employers’ and workers’ representatives at European level to value vocational work-based learning but which is conducted in the framework of quality-assured practices to maximise benefits to both learners and employers.

The European Commission presented its Flagship Initiative for the Responsible Management of the Supply Chain in the Garment Sector. This issue touches upon several aspects of sustainable development ranging from safety at work, child labour, use of chemicals, collective rights, and enforcement of national legislation, human rights and other international standards. The proposed initiative is aimed at increasing awareness and support for the need to foster responsible management of the entire supply chain whilst also improving communication on relevant EU actions on strengthening sustainable development hand-in-hand with better coordination between EU institutions and processes. Employers’ representatives showed their support to this initiative whilst raised concerns such as the need for concerted efforts so that the onus of responsibility on supply chain management on small businesses which deal with wide ranges of suppliers may be shifted towards collaborative efforts that may make this more possible to deal with. Direct online commerce was also raised as an issue which is difficult to check and trace.

Moreover, during these meetings, a draft joint letter of European social partners to the European Commission expressing concern on social dialogue and the role of social partners. Whilst the Commission continues to state its commitment towards the strengthening social dialogue, seeking to introduce impact assessment and public stakeholder consultation procedures for European social partner agreements under Article 155 of the EU treaty, may result in effectively weakening European social dialogue.

 

GRTU President Paul Abela has welcomed the candidate for the position of Honorary Consul Martin Ramusch from Austria. Mr Abela initiated the discussion by explaining how GRTU reaches out to its members to provide assistance and information on various issues that affect local business. As the Chamber for SMEs, GRTU has grown into a leading social partner represented on national fora such as the Malta Council for Economic and Social Development whilst maintaining a central role in EU policy through its active membership in UEAPME and EuroCommerce.

 GRTU is central to Mr Abela continued by emphasising that GRTU holds a healthy relationship with government as well as with the opposition. This allows GRTU to advocate its members concerns with directly policy makers and decision-making fora. GRTU is also engaged in providing services and support to its members allowing it to act as a business partner to its members.

It was also discussed that Malta has already taken the opportunity to invest and do business with Austria. This fact alone continues to encourage strong ties and investment between both countries. Austria places itself as one of the most advanced economies in Europe and Malta’s fast developments and flexible growth places both countries as ideal partners to allow business growth and cooperation. Exchange of business practices, models as well as resources, can serve as channels to broaden and deepen cooperation initiatives for mutual benefit.

 

Members are hereby informed that by virtue of the Budget Measures Implementation Act, 2015, enacted on the 30^thApril 2015 but coming into force retroactively, importers of the relative HS Codes indicated hereunder are not to fill in and submit any Eco Contribution Returns to the VAT Department in relation to such products for goods imported after the 18th November 2014 that have now become liable to Excise Duty by virtue of the same Act.

These amendments to the Eco Contribution Act also confirm that there is no legal liability for producers to pay Eco Contribution on such products imported after the 18th November 2014.

Extract from the Budget Measures Implementation Act, 2015:

PART XXXV

Amendment to the Eco- Contribution Act [Cap. 473]

162.        

(1) This Part amends the Eco-Contribution Act and it shall be read and construed as one with the Eco- Contribution Act, hereinafter in this Part referred to as “the principal Act”.

(2) The provisions of this Part shall be deemed to have come into force on the 18th November, 2014.

 

163. In the First Schedule to the principal Act, the following tables shall be deleted:

“AMMUNITION”

9306 Cartridges, whether or not filled with ammunition, excluding:

i) cartridges for riveting or similar tools or for captive-bolt humane killers;

ii) cartridges, filled with lead pellets of a maximum weight not exceeding 24 grams €0.05 per piece

 “TYRES FOR MOTOR AND COMMERCIAL VEHICLES, UNDER THE FOLLOWING HEADINGS:

4011 New pneumatic tyres, of rubber, not including tyres of heading 4011 50 €4.66

4012 Retreaded or used pneumatic tyres of rubber; solid or cushion tyres, of rubber €4.66

“PETROLEUM OILS, UNDER THE FOLLOWING HEADINGS:”

Lubricating oils; other oils:

2710 19 71 For undergoing a specific process €0.23 per litre

2710 19 75 For undergoing chemical transformation by a process other than those specified in respect of subheading 2710 19 71 €0.23 per litre

For other purposes:

2710 19 81 Motor oils, compressor lube oils, turbine lube oils €0.23 per litre

2710 19 83 Liquids for hydraulic purposes €0.23 per litre

2710 19 85 White oils, liquid paraffin excluding heavy liquid paraffin BP/USP 6360 qualifying as a food grade product €0.23 per litre

2710 19 87 Gear oils and reductor oils €0.23 per litre

2710 19 91 Metal-working compounds, mould release oils, anticorrosion oils €0.23 per litre

2710 19 93 Electrical insulating oils €0.23 per litre

2710 19 99 Other lubricating oils and other oils €0.23 per litre

 

 

GRTU hosted an information session on Legal and Commercial Guarantees. The focus was to explain to business-owners the obligations that arise from guaranteeson sale of products, as well as explain the differences between the legal guaranteewhich emanates from EU legislation, and the commercial guaranteewhich is a contract which may be entered into by the seller and the customer.

The session was chaired by GRTU Vice-President Finance & Administration Mr Marcel Mizzi. It was addressed by Dr Irene Bonello from the Malta Competition and Consumer Affairs Authority (MCCAA) who focused on consumer protection and traders’ obligations, and by Dr Nadine Sant from the Ministry for the Economy, Investment and Small Business (MEIB) who focused more on the business-to-business aspect.

The meeting helped clarify grey areas which arise from both the regulations emanating from EU directives as well as national legislation, whilst also promoting the notions behind these regulations which are not always necessarily fully or correctly applied, at times due to lack of sufficient knowledge. Regulations in force stipulate the minimum legal guarantees which the trader is obliged to fulfil towards his client. The commercial guarantee is over and above the legal guarantee and is intended to place the beneficiary at a better position than that through the legal guarantee. This should be set out clearly in writing yet commercial guarantees which would have been advertised, even if not written in the form of a contract, have to be fulfilled by the seller anyway.

In terms of latent defects, the seller is bound to warrant that the sold item against any latent (hidden) defects which render it unfit for the use for which it was intended or which diminish its value to an extent that the buyer would not have bought it or sought to pay less. The seller is not answerable for any apparent defects which the buyer might have discovered for himself and hence the importance to inspect.

The session went into the specific details of main issues that may require clarification explaining various points and interpretations including specific cases. A main issue raised concerned differences between wholesaler liability based on guarantees offered by leading international brands and legal guarantees which the retailer would have to carry responsibility for. Aspects of the Civil Code were also discussed in terms of how business-to-business transactions effect guarantee since the regulatory framework of legal guarantees is specifically set for end-consumer benefit rather than business-to-business matters.

Specific cases discussed during the session showed how the onus of proof for latent defects is usually a subject of possible disagreement. In the first six months it is assumed that the defect was present at the point of purchase, but beyond this clients are assumed to have to prove that defect originated at point of purchase. Clarifications were also made on the burden of transport and delivery charges for replacements.

MCCAA also provided attendees with guidelines on how to draw up a commercial guarantee. The presentation as well as the template can be acquired by contacting GRTU on .

 

GRTU was presented with the Equality Mark certification by Hon Minister Helena Dalli, during the NCPE 11th annual conference. This certificate is testament to GRTU’s commitment towards gender equality, certifying the organization as a true equal opportunities employer.

As a registered employers organization the GRTU felt it necessary to embark 

on this exercise to lead by example and also experience first hand how accessible such certification is, especially to the smaller businesses in our country – micro enterprises. Micro enterprises are businesses employing less than 10 employees and these make up 95% of total enterprises and employ 35% of the Maltese workforce.

Micro enterprises tend to find the acquisition of standards and certification more difficult because they have less human resources to dedicate towards such efforts. This does not however mean that they do not operate on the required principles, quite the contrary, such principles however tend to be applied informally and this would not fit the requirements. Employing just 8 employees GRTU can easily be compared to any micro enterprise in Malta and GRTU’s experience with acquiring the Equality Mark was indeed very positive and accommodating to its working principles and needs.

Employing equal opportunities principles and flexible working arrangements is good for the company and good for the employee. A gender balanced workforce meets more successfully its customers’ needs and expectations due to its reflection of the market. In addition giving employees the needed flexibility encourages worker loyalty and increases retention rates.

Together with the GRTU another 11 companies and organizations were successfully certified with the Equality Mark. Applying and acquiring the Equality Mark carries no fee.