Author: SME Chamber

1. Mobilising private investment, €315 billion over the next three years (EFSI)
2. Making that investment reach the real economy (through Project Pipeline)
3. Improving the investment environment in Europe

GRTU has raised an issue with the Director General of Customs and the Commissioner for Inland Revenue related to sudden change in procedures implemented by Customs which has negatively affected enterprises, especially those importing goods from outside the EU and subject to pay duty charges.

Customs explained to the GRTU that they found themselves in a position where certain cheques were not being honoured and currently the law does not give customs effective ways to seek redress, because customs would have already released the goods, and the liability falls on the cashier that would have accepted the cheque in question. A recent such case has led to Customs changing policy with immediate effect to one where they will no longer accept cheques that are not backed by a bank guarantee and where the payment is required for the immediate release of the goods.

A number of other payment options are possible but these include cash, which presents its own risk and when the goods are released to a cargo haulier (burdnar) and it is not advisable for the cargo haulier to run around with such cash, as well as cheques and differed payments but these have to be backed by a guarantee. GRTU feels the options pose an additional cost and bureaucratic burden on enterprises, especially the smaller enterprises.

GRTU has insisted with Customs that they should start accepting electronic payments and will be presenting a set of proposals as to how the GRTU feels the Act regulating such instances, which is currently limiting us from enacting alternative measures, be amended.

GRTU has expressed its concern to the Superintendent of Public Health within the Ministry for Energy and Health with regard to the implementation of policies related to fines and penalties for smoking in entertainment and leisure premises.

GRTU appreciates the efforts undertaken by the Health Ministry over the years to promote a healthier lifestyle without smoking. Nevertheless, a growing concern for GRTU members remains over the implementation of fines and penalties to compliant business owners in the relevant industries, such as nightclubs and bars, which are unnecessarily burdened with fines. We need to ensure that such a positive policy is implemented proportionally and in a manner that makes sense.

GRTU has in the past worked closely with the respective health directorates to ensure that cooperation by owners is encouraged and rewarded. An example of such has been the involvement of GRTU in an information dissemination campaign related to No Smokingsigns in the leisure and entertainment premises and related public areas.

GRTU is referring to a reported increase of hefty fines being imposed on owners where there is no unreasonable doubt that the owner may not have himself allowed or entertained such smoking on one’s premises, or was not in a position to prevent such smoking. We have in the past reached an understanding to approach such cases in a logical manner.

Establishments that cater for hundreds of clients, that have clear signs that the premises are non-smoking, and take active measures to enforce this policy with their customers (such as with security personnel asking smoking tenants to leave the premises; have removed all forms of ashtrays within the premises), should not be held responsible and fined if a client has been found smoking within the premises with the owner and staff unaware.

It is clear that by smoking the client is breaching not only the law but also the policy of the establishment and the owners do take action to dissuade such behaviour. It is therefore illogical and unfair that the host is fined. The owners are not enforcement officers but they are happy to do their bit. GRTU believes that it is important that all the stakeholders cooperate to reach this common goal but this taxing attitude will simply be counterproductive with the owners that have always tried their best to cooperate.

GRTU will be seeking to ensure that the implementation of policies at hand, whilst beneficial from a public health point of view, do not create unnecessary and illogical burdens to compliant business owners.

On 11th February GRTU Deputy President Philip Fenech attended a Malta Council for Economic and Social Development (MCESD) meeting addressed by the Minister of Tourism Dr Edward Zammit Louis. During this meeting the Minister discussed the draft National Policy for Tourism for the years 2015 – 2020.

In the course the meeting, the Minister of Tourism Dr. Edward Zammit Lewis explained that tourism is the main pillar of the economy. He also mentioned that during the last years, there has been a high level of development and radical changes in this sector. This evolution has created the need to update the national policy for tourism, so that there is a better preparation 

for these new challenges which can unlock better career opportunities in this sector. 

When asked for comments, GRTU Deputy President Philip Fenech explained that GRTU members fall under different sectors thus at GRTU we believe that a marketing mix of tourism is essential as it effects a lot of different segments that continue to need fine tuning to create higher value added services that cater to over 1.6 million tourists. He also explained that between November and April there still is an excess capacity and the concept of cultural tourism prevails more during those months as an attraction for tourists beyond the sun and sea client.

Philip Fenech also mentioned that in the case of Malta’s National Airline it should continue to encourage different air linkages that have proven positive results by introducing the market to different nationality tourists. GRTU believes that Airmalta should focus on emerging markets rather than promoting travel destinations that are already served by our national carrier.

GRTU has this week held a consultation meeting with the private operators interested in the new measure announced in the Budget that announced the phasing out of the eco-contribution on electrical and electronic equipment and the implementation of the Waste of Electrical and Electronic Equipment (WEEE) Directive on all such goods.

In general the WEEE Directive covers all products that are plugged to the electricity supply or work with batteries. These are grouped under 10 categories: Large household appliances, Small household appliances, IT and telecommunications equipment, Consumer equipment, Lighting equipment (with the exception of household luminaires), Electrical and electronic tools (with the exception of large-scale stationary industrial tools), Toys, leisure and sports equipment, Medical devices (with the exception of all implanted and infected products), Monitoring and control instruments and Automatic dispensers. A full list of products can be found on page 17 of the following link: http://bit.ly/1zT54V3. The measure as announced in the Budget requires that all operators introducing such products for a commercial purpose in the Maltese market register with a compliance scheme that will take care of the collection of such goods and their further handling (dismantling, recycling, etc…) as required by the Directive. Such operators are also given the option of presenting a detailed plan of how they intend to comply with the requirements of the Directive on their own. This must be done by end June 2015. Government is committed that only once everything is in place and working correctly will the eco-contribution be removed as of 1st September 2015.

The shift from eco-contribution to WEEE is however very complex. For one it will introduce an environmental contribution on many products that were not subject to eco-contribution, therefore this effects hundreds product types. Also to consider is the fact that the implementation of the Directive will on average reduce the environmental contribution on products that were subject to eco contribution but it might also increase such contribution on a few of the products. An additional element that requires assessment is the level of preparedness of local service providers carrying out the requirements of the Directive and the role our limited economies of scale (cost advantageous linked to size), in comparison to other larger countries, plays in the level of prices for a particular service.

During the meeting various options were discussed and members were asked for their feedback on a number of ideas presented by the GRTU of how the Directive could be implemented.

An area of great concern is the lack of faith of members in enforcement by the Authorities. While members have all the good intentions of adhering to the requirements of the Directive they are very concerned about free riders and the lack of enforcement by MEPA in this case. Our experience with the Waste Packaging Directive is not a very positive one and the biggest issue is lack of enforcement by MEPA. Unless MEPA is serious in its enforcement efforts and guarantees are put in place in this regard, the implementation of the Directive will not be a successful one and as frequently happens the few will end up carrying the burden for the rest.

This was the first of many meetings and consultations to be held as GRTU wants to give its members the full opportunity to participate. GRTU wants to make sure the new system is a fair one, does not overburden operators and does not negatively affect their competitivity.

Members can obtain a more detailed set of minutes of the meeting by sending an email on .

Since there are still various wines on the market which were being sold prior to 1^stJanuary 2015, the Customs Department is going to be distributing banderols (stickers)that have to be fixed onto bottles/containers with a volume of 0.375 litresor more.

Between the 18^thFebruary 2015 and 14^thMay 2015, Customs Department representatives will be present in the following localities according to the following schedule to supply the banderols (stickers) to traders for existing stock:

The distribution will take place through the above-mentioned venues on the said dates for businesses operating in the specific localities. Unless otherwise specified, the times are: Monday to Friday 8am till 12pm (noon) and from 1.30pm till 4.00pm; and in cases of dates falling on Saturdays, 8am till 12pm (noon).

Traders need to take stock of the amount of bottles/containers of wine of 0.375 litres or more which are unmarked and need the banderols (stickers). A list of this has to be supplied Customs so that Customs may supply the necessary banderols (stickers). This stock should not include wine D.O.K. and I.G.T of local Maltese producers. However, table wine produced locally should also be included in the stock list. Traders will then have a maximum of five (5) days to affix the banderols (stickers) on their unmarked stock.

It is of utmost importance that business comply to this campaign since as from 25th May 2015 an enforcement campaign will be taking place and products found available in the market without the fiscal banderol will be confiscated and the trader may receive further legal action.

The Customs Department’s Excise Department is also extending its services on Saturdays (8am till 12pm – noon), whereby these fiscal banderols (stickers) may also be obtained.

GRTU has reacted to VGT tariffs in relation to Port Workers through communication with Transport and Infrastructure Minister Hon Joe Mizzi. GRTU believes that the reason the Port Reform was carried out was to decrease costs, which however, have not decreased in the last 9 years. The understanding was that the contract had to cover all costs and charges and therefore VGT should not be charging for the Port Workers’ Miscellaneous Tariffs. Since GRTU had protested against increases by the VGT, it is evident that alternative ways to increase charges are being sought. GRTU has received correspondence on the matter fromTransport Malta Chairman James Piscopo whereby GRTU has been informed that fees being applied have already been in place in the Port Work Regulations. This implies that these fees may not have been fully applied in the past but are being enforced today. In practice this may means a de facto  increase having been effected.  GRTU will be continuing with its campaign to see port charges reduced.

GRTU welcomes the announcement made earlier today by the Hon Ian Borg that around 845 SMEs will be benefitting from a new scheme that facilitates access to finance. GRTU understands this will be similar to the previous JEREMIE scheme, which was indeed very successful and popular with the smaller businesses, however this time under the new SME Initiative.

The JEREMIE scheme, GRTU believes, was successful mainly due to the additional advantages it offered, primarily more advantageous interest rates and collateral requirements. GRTU feels that these advantages should be even more pronounced this time round as they should reflect the ever increasing efforts of the European Central Bank with rock bottom interest rates and other advantageous conditions that prioritise lending, for increased investment and job creation.

Another positive element in the new scheme is that it will be offered by a number of banks, or at least those that choose to go for it. GRTU had highlighted the fact that JEREMIE was offered by only by one bank as a limitation, not because the bank acting as a financial intermediary did not deliver, but because SMEs should be free to do business with the bank of

their choice. This is also very healthy and GRTU looks forward to seeing most local banks not only sign up, to offer this renewed facility to their clients, but also competing between themselves by offering the most advantageous conditions.

GRTU thanks the Hon Ian Borg for addressing this limitation and we augur that this effort will result in real benefits for SMEs, equal to those that SMEs in other EU countries benefit from when it comes to access to finance.