Merchant Shipping Act (Cap. 234), article 49B

49B. (1) The rights arising in favour of the lessor of a ship in a finance charter may be secured through the registration in that ship’s register of a finance charter in strument executed by the financ e charterer in favour of the lesso r who shall acknowledge same in writing, in the presence of, and attested by a witness or witne sses. (2) On the production of a finance charter instrument for registration, the registrar shall record it in the register of the ship concerned. (3) A finance charter instrument m ay be drawn up to secure the performance of any obligation of the finance charterer in favou r of the lessor under and in terms of a finance charter, including the p ayment of hire, a principal sum and interest, an account current, as well as the performance of any other obligation. (4) The consent in writing of any registered mortgagee shall be required for the registration of a finance charter instrument. (5) The registration of any finan ce charter instrument shall not affect any mortgage registered o ver that ship or share therein irrespective of whether such mort gage registration is affected prior or after the registration of a finance charter instrument and any rights of the mortgagee shall in no way be prejudiced by the registration of a finance charter instrument: Provided that the registra tion of any finance charter instrument shall be without prejudice to the provisions of article 37C. (6) The registration of a finance charter instrument over a ship shall not prohibit the registration, amendment or discharge of any mortgage over that ship. (7) The transfer of the ship or any share therein referred to in the finance charter instrument shall not be prohibited and the regi strar shall record any such transfer provided that in such instances the le ssor shall either discharge the finance charter instrument prior to the transfer of the ship or transfer the finance charter instrument to the transfer ee together with the ship. (8) A registered finance charter instrument shall be considered as a charge over a ship which shall be enforceable erga omnes: Provided that for the purposes of article 54A, the debt secured by a finance charter instrument shall rank after any debt secur ed by a mortgage registered under the provisions of this Act or secured by a foreign mortgage recognised in accordance with this Act and aft er the debts specified in article 54 and in article 50 (c), (d), (e), (f), (g), (h), (i), M E R C H A N T S H I P P I N G [CAP. 234. 37 (j) and (k) but before the debts specified in article 50(l), (m), (n), (o) and (p) and in preference to other hypothecary and privileged claims: Provided further that the rights awarded to the lessor under this sub-article shall be limited to the ship indicated in the finance charter instrument and shall not apply to any debts, obligation s, actions and claims relating to the ship which arose prior to the registration of the finance charter instrument. (9) In the event of default of an y term or condition of a registered finance charter instrument or of any document or agreement refe rred to therein, the lessor shall, upon giving notice in writing to the finance charterer, be entitled to take p ossession of the ship in respec t of which the finance charter instrument is registered. (10) For the purposes of any ju dicial proceedings instituted by the lessor in connection with a finan ce charter, the respondent sha ll be deemed to be duly served if the application or other act is ser ved on the master of the ship, or if he is absent from Malta, on the local agent appointed for the ship, or in the absence of such local agent o n curators appointed by the court to represent the finance charterer and the ship. (11) The provisions of articles 38(4), 38(7), 44, 44A, 45, 46, 4 7 and 48 of this Act shall mutatis mutandis apply in respect of a finance charter instrument. (12) This article shall be without prejudice to the provisions contained in articles 19A and 19B: Provided that it shall be permissible for a finance charter instrument to be registered over a ship notwithstanding that th e said provisions are not availed of. (13) For the purposes of this article: (a) the term "finance charter" shall refer to the chartering or lease of a ship under terms where the possession, operation or control of that ship is given to a bareboat charterer or to a lessee including through a d emise or bareboat charter or a similar agreement, the principal purpose and intention of which is to finance the acquisition, operation, administration or management of that ship; (b) the term "finance charter in strument" shall refer to the registration of a finance charter as provided for in this article; (c) the term "finance charterer" shall refer to the person identified as the bareboat charterer or the lessee in th e finance charter; (d) the term "lessor" shall refer to the owner of a ship 38 CAP. 234.] MERCHANT SHIPPING which is the subject of or is ot herwise addressed in a finance charter. Amendment of a finance charter instrument.  Added by: I.2025.27.