Appeals court slams government over ‘irregular’ Grand Harbour concession

A ‘secret’ deal struck between Transport Malta, under the guidance of Minister Ian Borg and Marsamxetto Steamferry Services Ltd for the extension, without a tender, of a concession to offer exclusive passenger ferry services between Sliema, Valletta and Cottonera, will have to be re-opened following a decision by the Court of Appeals.

Following a challenge by Supreme Travel – a private company interested in competing to offer the service, the Appeals Court, presided by Chief Justice Mark Chetcuti upheld the appeal and slammed both the Public Contracts Review Board (PCRB) and Transport Malta on the way they handled the issue.

The Court said the way the PCRB  decided to take Transport Malta’s side and deny an examination of the case of Supreme Travel leaves much to be desired and was a wrong interpretation of the law.

Upholding the plea by Supreme Travel, the Court ordered the PCRB to re-hear the case and examine whether Transport Malta acted illegally when deciding, in secret, to extend a concession in favour of Marsamxetto Steamferry Services Ltd, which has been offering the exclusive service for several years. The company is a joint venture between the Fortina Group’s Zammit Tabonas and the Bianchi Group.

A very dubious extension

The Shift had reported how, in December 2020, when the eight-year concession given to Marsamxetto Steamferry Services Ltd came to an end, Transport Malta unilaterally decided to extend the contract by another three years instead of issuing a new tender as required by EU law.

Transport Malta and Minister Ian Borg kept this extension secret, denying any information to interested parties, which is also against the rules.

It was only through an investigation by The Shift and a parliamentary question by 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 contestation against Transport Malta’s decision at the PCRB.

Yet instead of examining the case to establish whether Minister Borg and Transport Malta had broken the law to favour Marsamxetto Steamferry Services Ltd, the PCRB agreed to take the side of Transport Malta, using a technicality and declaring that the contestation was inadmissible as it was not filed withing the six-month time window allowed by the rules.

Although, Supreme Travel’s lawyer, Reuben Farrugia, argued that his clients could not file a contestation before, since the signing of the public contract was kept hidden 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 re-opening of the case while declaring that the decision by the PCRB was illogical and illegal.

“If the economic operator (Supreme) was not informed about the contract extension, as it was kept secret, it could not contest the decision,” the court argued.

The court also observed that the ministry and Transport Malta had failed to issue a public notice of the extension of the contract, also in breach of EU rules.

Fortina Group and James Piscopo

The Fortina Group, the co-owner of the lucrative extended contract, has been hitting the headlines for years due to its public proximity with the Labour Party and various decisions taken by the government in its favour.

These include an attempt by Transport Malta and Ian Borg to give the Zammit Tabonas a multi-million contract to offer fast ferry services to Gozo, deemed illegal and struck down by the courts and a dubious arrangement on former public land they own in Tigne, so that they could develop it into commercial and residential use instead of tourism purposes as originally agreed.

The Zammit Tabonas are also now involved in a new controversy over their promised new catamaran service to Sicily, as it failed to start as promised, leaving hundreds of booked passengers high and dry.

The Shift had already reported that shortly after leaving the Lands Authority – involved in the agreement over the Fortina hotel land, CEO James Piscopo joined the Fortina Group as their consultant.

Piscopo was also in business with the Zammit Tabonas’ in at least two companies when he was at the head of both Transport Malta and the Lands Authority. He was also mentioned in alleged bribe-taking from public projects, which he denies.

Until now, no charges were ever presented by the police against Piscopo – considered as one of the closest aides to former prime minister Joseph Muscat.