Court of Appeal condemns government for “irregular” concession to Grand Harbor
A “secret” agreement between Transport Malta, under the leadership of Minister Ian Borg and Marsamxetto Steamferry Services Ltd for the extension, without tendering, of a concession to offer exclusive passenger ferry services between Sliema, Valletta and Cottonera, will have to be reopened following a decision of the Court of Appeal.
Following a challenge from Supreme Travel – a private company interested in competing to offer the service, the Court of Appeal, chaired by Chief Justice Mark Chetcuti, upheld the appeal and criticized both the Public Contracts Review Board (PCRB) and Transport Malta on how they handled the issue.
The Court said that the way in which the PCRB had decided to side with Transport Malta and to deny consideration of the Supreme Travel case left much to be desired and constituted a misinterpretation of the law.
Accepting Supreme Travel’s plea, the Court ordered the PCRB to rehear the case and examine whether Transport Malta acted illegally in deciding, in secret, to extend a concession in favor of Marsamxetto Steamferry Services Ltd, which offered the exclusive service for several years. The company is owned by the Zammit Tabona family and the Bianchi group.
A very dubious extension
The Shift had reported how, in December 2020, at the end of the eight-year concession granted to Marsamxetto Steamferry Services Ltd, Transport Malta unilaterally decided to extend the contract by three years instead of launching a new tender like the ‘demands EU law. .
Transport Malta and Minister Ian Borg have kept this extension secret, denying any information to interested parties, which is also against the rules.
It was only thanks to an investigation by The Shift and a parliamentary question from MP Mario Galea that the extension became public, some three months later after the actual signing. As soon as the scandal was made public, Supreme Travel immediately filed a challenge against Transport Malta’s decision with the PCRB.
Yet instead of examining the case to establish whether Minister Borg and Transport Malta had broken the law in favor of Marsamxetto Steamferry Services Ltd, the PCRB agreed to side with Transport Malta, using a technicality and stating that the challenge was inadmissible because it was not filed within the six-month period allowed by the rules.
Although Supreme Travel lawyer Reuben Farrugia argued that his clients could not file a dispute before, since the signing of the public contract had been concealed by the Minister and Transport Malta, the PCRB still decided to rule against Supreme Travel.
Following a challenge to this decision, the Court of Appeal has now ordered the case to be reopened while declaring that the PCRB’s decision was illogical and illegal.
“If the economic operator (Supreme) was not informed of the extension of the contract, because it was kept secret, he could not challenge the decision,” said the court.
The court also observed that the ministry and Transport Malta had not issued a public notice of contract extension, also in violation of EU rules.
Fortina Group and James Piscopo
The Fortina Group, co-owner of the lucrative extended contract, has been in the headlines for years because of its public proximity to Labor and various decisions taken by the government in its favor.
These include an attempt by Transport Malta and Ian Borg to give Zammit Tabonas a multi-million euro contract to offer fast ferry services to Gozo which has been ruled illegal and overturned by the courts and a questionable arrangement on former public land that they own in Tigne, that they could develop it for commercial and residential purposes rather than tourism purposes as originally agreed.
The Zammit Tabonas are also now embroiled in new controversy over their promised new catamaran service to Sicily, as it did not start as promised, leaving hundreds of booked passengers in the dry.
The Shift had previously reported that shortly after leaving the Lands Authority – involved in the Fortina hotel land deal, CEO James Piscopo joined the Fortina Group as a consultant.
Piscopo was also in business with the Zammit Tabona in at least two companies while at the head of Transport Malta and the Lands Authority. He has also been mentioned in allegations of corruption in public projects, which he denies.
So far, no charges have ever been brought by police against Piscopo – considered one of former Prime Minister Joseph Muscat’s closest associates.