Transport operator challenges ‘illegal’ secret ferry concession to Zammit Tabona – Bianchi Group

Updated to include ‘Right of Reply’ received from Marsamxetto Steamferry Services Limited.

Supreme Travel has filed a court appeal contesting the ‘illegal’ extension of a public concession, given by Transport Malta and Minister Ian Borg and backed by the government-appointed Public Contracts Review Board (PCRB), to a joint venture between the Fortina Group’s Zammit Tabonas and the Bianchi Group to operate ferry services between Sliema, Valletta and Cottonera.

Last month, The Shift reported how the PCRB used a technicality to dismiss the review of the public concession worth millions. It involves the irregular extension of an exclusive government contract to provide scheduled passenger ferry services between towns to Marsamxetto Steamferry Services.

Supreme Travel turned to the Appeals Court after it was denied the possibility to contest the decision on a ‘technicality’.  The operator said the PCRB decision was a “legal absurdity”. It called on the Appeals Court to send out a clear message that such government actions are not tolerable in a democratic country.

The PCRB based its decision to disallow the continuation of a challenge from Supreme Travel against Transport Malta on the latter’s argument that the six-month time window allowed for the submission of a request for remedy had elapsed.

The PCRB appeared to ignore the fact that in the case of the public concession being contested, both Transport Malta and the Authority had signed the contract extension in secret and failed to even disclose the required information to parliament.

Arguing that the PCRB decision makes no sense because Supreme Travel could not have known when the contract extension was signed since it was kept secret, the company asked the court to annul the PCRB decision and allow the challenge to be heard.

Supreme Travel said the court should also declare that the PCRB’s decision defy EU rules, particularly the Remedies Directive.

Secret deal benefits incumbents

The eight-year public concession given to Marsamxetto Steamferry Services to provide an exclusive passenger ferry service between Sliema, Valletta and Cottonera came to an end in 2020.

Instead of issuing a new public call to re-open the concession for competition, according to law, Minister Ian Borg and Transport Malta chose to sign a secret agreement with the incumbent, extending the concession by another three years, at least.

This extension was never announced and the secret deal was only revealed through parliamentary questions and investigations by The Shift.

The Shift also discovered that the exclusivity granted could well extend beyond three years since Minister Ian Borg agreed to insert a clause in the new contract that gives the consortium an unspecified period of breathing space to compensate for the fall in business caused by the Covid-19 pandemic.

James Piscopo’s hand

The Zammit Tabona/Bianchi Group venture started lobbying for an extension of their exclusive eight-year concession during the time James Piscopo, the former CEO of the Labour Party, was heading the transport regulator. The extension was, however, formally signed by his successor, Joe Bugeja, handpicked by Minister Ian Borg.

The Shift has revealed that Piscopo is currently on the payroll of the Zammit Tabonas and is acting as their advisor on several projects.

While he led Transport Malta, Piscopo was also involved in companies co-owned by the Zammit Tabonas. After he moved to the Lands Authority, the Zammit Tabonas signed a lucrative deal with the government to acquire former public land in order to develop parts of their Fortina Hotel into offices and residences, making millions in the process.

No investigations into these issues have yet been carried out.

Piscopo, one of the closest aides of disgraced former prime minister Joseph Muscat, resigned from his position with the Lands Authority earlier this year, a few days after his name was mentioned in connection with alleged bribes around roadworks when he was at Transport Malta.

The allegations were said to have been made to various media outlets by Yorgen Fenech on behalf of Keith Schembri.

Piscopo denies the allegations, but a police investigation into the matter has not yet been concluded.

Piscopo remains closely connected to the government after Prime Minister Robert Abela confirmed his role as chairman of ARMS Ltd, the billing company for Enemalta and Water Services Corporation.

Piscopo has also been confirmed as a board member of Enemalta and Projects Malta – now called Malta Strategic Partnership Projects – which also falls under Minister Ian Borg’s portfolio.

Marsamxetto Steamferry Services ‘Right of Reply’

The Shift has received the following ‘Right of Reply’ from the company Marsamxetto Steamferry Services:

“Marsamxetto Steamferry Services Limited refers to the story as reported by The Shift Team with the title ‘Transport operator challenges “illegal” secret ferry concession to Zammit Tabona – Bianchi Group’ and appearing online in the portal of The Shift on the 8 July 2021.

The company would like to draw your attention to the biased reporting related to an appeal before the Maltese Court of Appeal lodged by Supreme Travel Limited following a decision of the Public Contracts Review Board (PCRB) on 1 June 2021.

Whilst fully supporting the role of journalism in a democratic society, Marsamxetto Steamferry Services Limited believes that every party in a disputed claim has a right to a due process in the proper legal forum both at first instance and at the stage of appeal, based on the principle of equality of arms. In our experience we have learnt that there is no other forum that can guarantee this due process based on such principle. Marsamxetto Steamferry Services Limited therefore takes great exception to the biased reporting.

The report states that the competitor is challenging the “illegal” deal. Whilst forcefully disputing this allegation of illegality, we would like to stress for the record that it is up to the competent Court to decide on the dispute. Until a contract is so declared by the Courts, the claim remains a biased allegation by who is both making it and reporting it. Our client maintains that the contract referred to is legal and valid at law, as is reiterated in the reply filed by Marsamxetto Steamferry Services Limited before the Courts.

The report also states with great emphasis of bias that the allegedly “illegal” contract was “backed” by the PCRB as a government appointed board, coupled with a choice of words like “used a technicality to dismiss a review” of the disputed agreement. The report clearly has the intention to give the reader a one-sided and prejudiced point of view, far from the scope of fairness. In fact, the team of Shift News failed to report that the Court of Appeal have, on plenty of occasions, upheld pleas based on limitation of actions.

Your report attempts to put in doubt the integrity and competence of the PCRB when its conclusions are based on firm, established and grounded administrative principles. Any doubts on the PCRB’s conclusions, until decided otherwise by the Court of Appeal, are based solely on the subjective interpretation of whoever has lodged the appeal.

At this stage there is no other forum but the Court of Appeal that can guarantee the principle of equality of arms as part of a due process. We felt it is our duty to put the record straight in an attempt address the bias in your reporting.”