Litigation relating to commercial disputes in Malta is generally settled before the national court, both in first and second instance. However, there are special courts that may be appointed for disputes of a specific nature. There are also “lower courts” (Inferior Courts) which are competent for court cases with a reduced monetary value.
The parties may also agree to settle their dispute in arbitration, either before a dispute arises or after a dispute has already arisen. Arbitration in Malta tends to be more efficient and more specialized than litigation, with the possibility of appointing arbitrators with particular technical or industrial knowledge and experience. Moreover, since Malta is a signatory to the New York Convention (1958), any judgement resulting from an arbitration procedure based in Malta can be fully recognized and enforced in other Contracting States of that Convention.
The main procedural rules governing commercial litigation are enshrined in the Code of Organization and Civil Procedure (the “COCP”), Chapter 12 of the Laws of Malta.
Commercial litigation before the Higher Courts of Malta is generally initiated by an application filed by the applicant in the court register indicating the subject matter of the application and the remedy sought and confirmed on oath. Once notification has been filed, the addressee of the litigation is given twenty (20) days to submit a response, failing which he or she would be deemed to be in default before the law.
After the commencement of proceedings, a hearing shall normally be held to deal with matters of case management, including confirmation of the validity of the notification to the parties. The court may also appoint a judicial assistant to manage the hearing and collect evidence. Once the evidentiary stage is completed, each party will have the opportunity to present its concluding arguments in writing or orally, and the court will issue a final judgment which may be subject to appeal.
The COCP also provides for a more rapid procedure to enforce an appeal for a certain, liquid and payable debt not exceeding twenty-five thousand euros (“25,000”). This application must be accompanied by a statement from the applicant attesting to the existence of the claim. After thirty (30) days from the notification, without the defendant having replied, the Court may proceed to pronounce the judgment in favour of the applicant.
There is no fixed time limit within which the proceedings must be concluded. The duration of disputes depends largely on the case management practices adopted by the court. In practice, after a court application has been filed, the first hearing is usually set within six weeks.
Exceptionally, special summary proceedings filed in relation to a claim that is certain, liquid and due must be heard no earlier than fifteen days and no later than thirty days after notification of the sworn application to the defendant.