Re-establishment of the commercial court

Abstract

Malta is on the cusp of a significant judicial reform with the publication of Bill No.133, entitled “Various Laws relating to the Establishment and Jurisdiction of the Commercial Court (Amendment) Act, 2025” in the Supplement to the Government Gazette on 9 May 2025. The Bill seeks to re-establish a dedicated Commercial Court (an institution dissolved in 1995) as a distinct entity, separate from the Civil Court.

However, the Bill has not yet become law. It will only enter into force once it is passed through Parliament, receives the Presidential assent, and is brought into operation by a ministerial notice published in the Government Gazette. Until then, the current legal structure remains in effect. Nevertheless, the publication of the Bill represents a major step toward reforming Malta’s commercial litigation landscape.

Historical background

Malta previously had a self-standing Commercial Court, which handled cases arising under the Commercial Code. Over time, however, procedural delays and recurring disputes about whether claims were civil or commercial in nature caused confusion. Determining jurisdiction became unnecessarily complex and time-consuming, ultimately leading to the court’s dissolution through Act XXIV of 1995. As a result, commercial cases were absorbed by the First Hall of the Civil Court, and Article 32(2) of the Code of Organisation and Civil Procedure (‘COCP’) was amended to state that “all causes of a civil and commercial nature shall be heard before the First Hall Civil Court.”

From that point onward, no assessment was required to determine whether a matter was civil or commercial in nature, the Civil Court retained competence regardless. However, this also led to the loss of specialisation in commercial matters, an issue that became more apparent over time.

A significant development occurred in 2018 with the enactment of Act I of 2018, which introduced a Commercial Section within the Civil Court. This section had limited jurisdiction, specifically over matters governed by the Companies Act, including bankruptcy, dissolution, winding-up, and Article 402 unfair prejudice claims. The reform aimed to alleviate the growing burden of complex commercial litigation by assigning these matters to judges with relevant expertise.

Subsequently, Act XVI of 2019 expanded this jurisdiction to include disputes under the Competition Act, the Consumer Affairs Act, and other related legislation moving forward, inter alia the more recently implemented Pre-Insolvency Act and Insolvency Practitioners Act (both introduced in December 2022). These amendments acknowledged the increasing volume and complexity of commercial cases, particularly in the context of both EU and domestic legislative developments.

Nowadays, the jurisdiction of the Civil Court (Commercial Section) is governed by Subsidiary Legislation 12.19, specifically Article 5A, which reads:

“To the Civil Court (Commercial Section) shall be assigned applications falling within the competence of the Civil Court and which relate to matters regulated by the Third Part of the Commercial Code and any regulations made thereunder, by the Companies Act, by the Pre-Insolvency Act, the Competition Act and any regulations made thereunder, by the Consumer Affairs Act and any regulations made thereunder, and by the Malta Competition and Consumer Affairs Authority Act, and by the Representative Actions (Consumers) Act.”

These developments mark a gradual revival of specialisation in commercial litigation, although still within the framework of the Civil Court.

Parliamentary journey

Bill No. 133 was presented to Parliament in December 2024 and underwent its First Reading; a procedural stage involving the formal introduction of the Bill’s title without debate. It was subsequently published on 9 May 2025 in the Supplement to the Government Gazette as Government Notice No. 708. This publication marked the Bill’s formal tabling but did not bring it into legal force.

The Bill must still undergo its Second Reading, Committee Stage, and Third Reading, during which it will be debated, possibly amended, and then voted upon. Only after it is approved by Parliament and receives the Presidential assent will it become law. Even then, the Bill contains a commencement clause specifying that it shall enter into force on such date as the Minister responsible for Justice may establish by notice in the Government Gazette, potentially in stages. Until such a notice is issued, the existing legal framework remains in place.

Key legislative changes

The primary aim of Bill No.133 is to establish the Commercial Court as a separate Superior Court within the Maltese judicial system, distinct from the Civil Court, First Hall. As a result, the COCP will be amended to reflect a new structure of the Superior Courts, which will now comprise four distinct fora: the Civil Court, the Constitutional Court, the Court of Appeal and the newly reconstituted Commercial Court.

While the Bill provides for a single judge to preside over the specialised Commercial Court, there are discussions to increase this number due to the large workload.

Another central change lies in the amendment of Article 32 of the COCP, which will no longer refer “causes of a civil and commercial nature” to the Civil Court, First Hall. Instead, it will read; “causes of a civil nature and of such causes of a commercial nature which are not otherwise assigned by law to the Commercial Court”. This careful wording reflects a deliberate legislative effort to avoid jurisdictional overlap that had plagued the court system prior to 1995. It adopts the principle of ubi lex voluit dixit, ubi noluit tacuit (when the law is silent, it is presumed to have purposely excluded it), emphasising that the competence of the Commercial Court should be clearly and exhaustively defined by law or regulation.

Despite this intent, the Bill’s own wording later introduces ambiguity when it provides that the Commercial Court shall determine “amongst other matters” a wide array of commercial causes. This risks reintroducing the very uncertainty that the reform seeks to eliminate.

The Bill then attempts to clarify jurisdiction by providing a detailed, though arguably not exhaustive, list of subject matters falling within the Commercial Court’s remit. These include disputes under or related to the Commercial Code, the Companies Act, the Competition Act, merchant shipping, marine collisions, salvage, maritime insurance, pollution, intellectual property rights, negotiable instruments, bankruptcy, and enforcement-related proceedings such as the seizure of going concerns and sea protests.

Further jurisdiction is conferred over matters regulated by the Carriage of Goods by Sea Act, the Civil Aviation Act (excluding criminal provisions), the Merchant Shipping Act, the Ports and Shipping Act, the Banking Act, the Financial Institutions Act, the Consumer Affairs Act, and the Arbitration Act. The Commercial Court is also empowered to hear actions in rem and in personam involving ships and vessels under Article 742B of the COCP, judicial and private sales of ships and aircraft, and any claims brought by or against Maltese shipping organisations or international owners.

Complementing these jurisdictional reforms is a practical administrative change concerning Gozo. Where parties reside or have their registered office in Gozo or Comino, the Commercial Court shall hold its sittings in the Gozo court building. The Bill also amends the Commercial Code so that the commercial registry in Gozo is maintained under the authority of the Commercial Court, rather than the Civil Court, aligning practices between Malta and Gozo.

Further technical amendments are made to the COCP and Commercial Code to substitute references to the Civil Court First Hall with the Commercial Court, ensuring consistency in terminology and structure.

Practical implications

The resurrection of the Commercial Court is expected to modernise commercial litigation in Malta by introducing greater specialisation, procedural clarity, and efficiency. Practitioners and businesses alike stand to benefit from a system that is better adapted to the complexity and urgency of commercial and maritime cases.

Nonetheless, some concerns remain. These stem from Malta’s own judicial history. The previous Commercial Court, abolished in 1995, was dismantled in part due to ambiguity around its jurisdiction and resulting delays. There is a legitimate concern that unless the new court’s remit is implemented with clarity and discipline, the same structural issues may resurface, especially once the ambiguity of phrases like “amongst other matters” may open the door to lengthy jurisdictional disputes.

Additionally, current administrative delays in court processing, with judicial acts facing various bottlenecks in the court registry, highlight the need for timely and specialised legal intervention. In sectors like maritime law, where judicial delays can have significant financial implications, an operational and responsive Commercial Court could provide essential relief. However, this depends not only on legal reform but on administrative preparedness and judicial capacity. Until the Ministerial commencement notice is issued, however, these benefits remain prospective.

Conclusion

The publication of Bill No.133 as a Government Notice marks a significant legislative step toward the re-establishment of a dedicated Commercial Court in Malta. Though not yet in force, the Bill reflects a clear legislative intent to modernise and specialise the handling of commercial disputes. Whether the reform achieves its purpose will depend on the precise implementation of the new court’s jurisdiction, the clarity of legal boundaries, and the readiness of the judicial administration to support this change.

As the Bill progresses through Parliament and the legal community awaits the Ministerial notice that will bring it into effect, preparation for a more focused and responsive system of commercial justice is both necessary and timely.

Disclaimer: This report reflects the author’s personal academic observations and does not represent the views of Ganado Advocates. It is intended solely for information and scholarly purposes and should not be construed as legal advice. This article was first published in ‘The Malta Independent’ on 27/08/2025.