Fuel importer’s €20,000 fine revoked over denied meeting with authority

The Maltese Courts have rejected claims by a fuel importer that they had no carbon emissions reporting obligations, upholding the Malta Resources Authority’s right to request information.

But they also revoked the €20,000 administrative fine imposed on Cassar Fuel Limited, emphasising the importance of the MRA engaging in dialogue and providing clarification before resorting to such sanctions.

The case highlighted the importance of clear communication and transparency in regulatory processes, particularly when dealing with complex legislation and potential penalties.

The case concerned a dispute between Cassar Fuel Limited and the MRA regarding Cassar’s obligation to report on greenhouse gas emissions.

As an authorised fuel provider regulated by REWS (Regulator for Energy and Water Services) Cassar was obliged to annually report information on greenhouse gas emissions on the fuel it places on the market, regardless of whether they physically handle fuel passing through Customs.

Cassar stated it has no such obligations because they purchased fuel that was duty-paid or which did not fall under the scope of the law.

When in 2021, they claimed no reporting obligation without providing any reasons, the MRA issued a formal notice and subsequently imposed a €20,000 administrative fine for non-compliance.

Cassar argued that as a fuel distributor, not an importer, they were exempt from reporting requirements as they did not handle fuel passing through customs. They maintained that the fuel they purchased from Enemed, was already “duty paid” and treated according to regulations, meaning they had nothing to report.

Cassar also claimed they had contacted the MRA multiple times to explain their operations and requested meetings for clarification, which the MRA did not grant.

The Administrative Review Tribunal, presided by Magistrate Charmaine Galea, decreed that as a REWS-registered supplier Cassar was legally obliged to submit their reports.

Acknowledging the MRA’s concerns regarding Cassar’s change in potential non-compliance, the Tribunal however deemed it crucial for the MRA to have granted Cassar’s request for a meeting to clarify the situation before imposing a significant fine.

The Tribunal ultimately revoked the MRA’s decision to impose the fine, citing the MRA’s failure to meet with Cassar as a key reason. “It is a basic principle of good administration that if a meeting is requested with an administrative entity on a matter that may have serious consequences, this meeting should be granted before any decision is taken that will seriously affect any individual or entity.”

Lawyers Roberto Montalto and Edward Zammit Lewis represented Cassar fuels.