CorporateDispatch Pro - Edition 20 by The Dispatch Media

Corporate DispatchPro

Issue No.20 | May 2021

Corporate DispatchPro The Journal of CI Group

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Issue No.20 | May 2021

Corporate DispatchPro The Journal of CI Group

EDITORIAL TEAM Managing Editor - Jesmond Saliba Editor – Nathanael Muscat

CONTENTS

CONTRIBUTORS Denise Grech Keith Zahra Lisa Jucca George Hay Pete Sweeney

Inglorious Food

The sweet and sour of hunger action

Holding the field

Eating for your genes

Malta Insights

Malta News Roundup

PRODUCTION ASSISTANT Laura Grima Shirley Zammit

Crime shouldn’t pay: why fighting money laundering matters

Human rights approach needed regarding cannabis legislation

The Maltese need to be protected from their own government

Shooting the messenger

Month in pictures

Communiqeu 51

DESIGN TEAM Matthew Borg Nicholas Azzopardi

Ray-Ban maker may finally live up to merger vision

Bike sharing shifts into a more manageable gear

North Sea oil IPOs had best take the plunge soon

SOURCES

Published By

ADDITIONAL SOURCES

Design Produced

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Corporate DispatchPro Cover Story

Shooting the messenger One night in a turbulent week, news outlets reporting from Gaza City were tipped off about an imminent air assault. The target was their offices. The Al-Jalaa tower housed eight media outlets including the Associated Press and Al Jazeera as well as tens of residential apartments and other offices. An hour after the advance warning, Israeli fighter jets hit the 11-storey building pulverising it into a column of black smoke. A spokesperson for the army maintained that members of Hamas, a Palestinian militant group, were hiding in the tower, a claim disputed by the president and CEO of Associated Press, Gary Pruitt. The news publishing veteran complained that the destruction of the building will hide the ongoing fighting in the Gaza strip from the world’s eyes. The strike on the Al-Jalaa came three days after a similar bombing of the Shorouq tower, a stone’s throw away. The 14-floor structure was also home to media offices. International observers raised concerns about attacks targeting news outlets, prompting White House press secretary Jen Psaki to call for the safety and security of journalists and independent media. This round of Israel-Palestine conflicts escalated quickly from the convergence of, relatively, minor incidents. Tensions were already high when the first day of the Ramadan and Memorial Day in Israel coincided, on April 13. Confrontations between Muslim Palestinians and Israeli police officers in and around the Al-Aqsa Mosque started to snowball. Meanwhile, six Palestinian families in the West Bank were facing eviction from the Israeli government, stirring a wave of protests

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Corporate DispatchPro The Israeli army brushed off complaints by the media that they had been weaponised as part of an assault strategy, dismissing the misunderstanding as an honest linguistic mistake on the part of the spokesperson. on the streets. In the broader backdrop, a fragile government coalition in Israel and looming Palestinian elections piled pressure on leaders from both sides. In the ensuing weeks, fighting erupted in dozens of Arab-Jewish cities across the country, climaxing into a volley of rockets fired from Gaza in the second week of May. News reports on the degenerating events sparked demonstrations, marches, and condemnation from around the world as the international community frantically urged de-escalation. The collapse of the Al-Jalaa and the Shorouq has all but drawn the curtains on a window into the situation. But this was not the only attack on news outlets during the hostilities. International media organisations broke the news that the Israeli army was conducting a ground operation in Gaza in the early hours of May 14. The media faithfully repeated an announcement by a senior spokesperson of the army itself, but by the morning it became clear that, in fact, the military had only been moving tanks and armoured vehicles to the border. The reports, however, led Hamas fighters to mobilise, making them easier targets for Israeli airstrikes. The Israeli army brushed off complaints by the media that they had been weaponised as part of an assault strategy, dismissing the misunderstanding as an honest linguistic mistake on the part of the spokesperson. Often caught in the crossfire, journalists and media crews endanger their lives to report on developments from conflict zones. But the tragic events in Gaza now risk reframing news media as fair game. 5

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JUVENTUS THREATENED WITH EXCLUSION FROM SERIE A Italy’s Juventus will be excluded from the next Serie A championship season should the Italian soccer club decide to stay in the proposed European Super League, the head of the national soccer federation (FIGC) said.

VIRGEN DE LOS DOLORES TEMPLE IN ZANGARRO COMMUNITY EXPOSED DUE TO DROUGHT Virgen de los Dolores (Our lady of Sorrows) temple in Mexico was exposed after heavy drought in the region. Built in 1898, the structure was was flooded 40 years ago to build a dam.

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Corporate DispatchPro ULA VON DER LEYEN BECOMES GRANDMOTHER ON EUROPE AND MOTHER’S DAY The European Commission President Ursula von der Leyen announced on Instagram that she became a grandmother May 9. The day marks Europe Day and, in several countries in Europe, it also was Mother’s Day. Earlier, the President was in Strasbourg to launch the Rules of Procedure setting out the composition of the Plenary of the Conference on the Future of Europe.

A GIANT PIECE OF SPACE JUNK IS HURTLING TOWARDS EARTH A large piece of space debris, possibly weighing several tonnes, is currently on an uncontrolled reentry phase into the Earth’s atmosphere. Parts of it are expected to crash down to Earth over the next few weeks.

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MILAN’S MALDINI APOLOGISES TO FANS Milan legend Paolo Maldini apologised to club supporters for the Super League debacle even though he was not involved in the discussions and only got to know about the plans through the media when they were first announced.

GANDHI WARNS ‘EXPLOSIVE’ COVID-19 WAVE THREATENS INDIA AND THE WORLD India’s main opposition leader Rahul Gandhi warned that unless the deadly second Covid-19 wave sweeping the country was brought under control it would decimate India and threaten the rest of the world.

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Corporate DispatchPro US JOINS RACE TO FIND STRICKEN INDONESIA SUBMARINE Rescue teams from several countries were battling against time to find a missing Indonesian Navy submarine lost in the Bali Sea with 53 crew aboard. The submarine was later found split into three pieces on the seabed.

ISRAELI STUDY SAYS SOUTH AFRICAN VARIANT MAY EVADE PROTECTION FROM PFIZER VACCINE The coronavirus variant discovered in South Africa may evade the protection provided by Pfizer/BioNTech’s Covid-19 vaccine to some extent, a realworld data study in Israel found. The prevalence of the strain was very low in the country and the research has not been peer reviewed.

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NASA’S INGENUITY HELICOPTER MAKES FIRST HISTORIC FLIGHT ON MARS NASA’s miniature robot helicopter Ingenuity performed a successful takeoff and landing on Mars, achieving the first powered, controlled flight by an aircraft over the surface of another planet.

LOOSER STATE AID RULES FOR LESS DEVELOPED REGIONS TO MEET EU GOALS EU state aid regulators eased rules allowing member countries to grant more state aid. The measure will help less developed regions across the 27-country bloc achieve green and digital goals and boost economic growth.

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Corporate DispatchPro ASHES OF CAMORRA ‘YOUTH BOSS’ FOUND IN ALTAR IN NAPLES The Carabinieri lifted a bust containing the ashes of the ‘baby boss’ Emanuele Sibillo, killed in a Camorra ambush, in a votive chapel in the historic center building in Naples, Italy.

MALTA WINS EUROVISION SPECIALIST BLOG READERS VOTE Eurovision Song Contest specialist ‘Wiwiblogs’ readers have chosen Malta’s as their favourite song in this year’s edition. The song, Je Me Casse, was performed by teenage artist Destiny

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Corporate DispatchPro Editorial

Inglorious food Since at least classical antiquity, civilizations have been longing for an abundance of food. The symbol of the cornucopia was handed down from Greek god to French monarchy to the Peruvian coat of arms. The ‘Horn of Plenty’ represents a deepseated human hope for assured sustenance. Hope turned into reality in the last century and by 2011 it was estimated that the world was producing as much as one-third more food than people could consume. Food waste is a huge issue as households and eateries throw out half-eaten meals and retailers discard products that have a lower sales value. Global data suggests that almost one billion metric tons of food waste were generated in 2019, with over 60 per cent of it produced by households. But the problem with spoilt foods starts much earlier in the production chain, and farms, fishing fleets, manufacturing plants, and exporters report even greater food loss. Market pressures sometimes lead producers to throw food away or leave it unharvested. Although many countries have measures in place to recover over-production and donate it to relief programmes, added expenses linked to processing and transportation rarely make the system cost-effective. Loss of food is not only a challenge affecting high-income countries. Pakistan discards around a third of its tangerines, the same share of beans thrown away in Guyana and shallots in Sweden. Food waste created by households, likewise, is a worldwide phenomenon. Squandered produce is more than a pile of excess crops left to rot. The food process, from primary production through to the final stages requires great amounts of water and energy. 13

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The Food and Agriculture Organisation calculated that, on a global scale, around 36 exajoules of energy goes into foods that are left to waste every year. Put into perspective, that makes six per cent of the annual primary energy consumption by the world’s population. Foods are also water-intensive. A hamburger will consume some 2,000 litres of water until it is plated. A plant-based alternative requires around 75 per cent less; a considerable volume, nevertheless. In the longer term, excessive food production is harming the planet’s freshwater supply and generating energy wastage, a cycle that threatens the natural systems that grow our food in the first place. The irony of abundance is that, left unchecked, it may usher in an age of scarcity. JESMOND SALIBA

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The sweet and sour of hunger action With World War II still raging, in 1943, governments from over 40 countries convened to fight another cross-border threat: hunger. Within two years, the Food and Agriculture Organisation (FAO) was set up on the Latin promise fiat panis – let there be bread. The push to eradicate chronic hunger and food insecurity was one of the collective achievements of the 20th century. Fifty years after the seeds of the FAO were sown, the global share of undernourished individuals stood at less than one in five while the world population more than doubled. Towards the end of the 2010s, that share nearly halved to 10.8 per cent. Although the successes over the decades are indeed remarkable, thanks to advances in research, technologies, distribution, and rising living standards, the World Hunger Index (GHI) estimates that 820 million people still suffer undernourishment. More worrying still, is the disparity between developed nations and the rest of the international community. Almost two-thirds of hunger emergency hotspots are located in the Asia Pacific region while the remaining zones are mainly concentrated in Sub Saharan Africa. Today, no country has a majority of people experiencing hunger, but the severity of malnutrition is “alarmingly high” in Chad, Timor-Leste, and Madagascar with more than one person in three affected. The GHI considers the situation in 31 countries “serious”, as undernourishment affects between a fifth to a third of the national population. Another 26 countries have a “moderate” challenge in malnutrition, with more than a tenth of people battling hunger. The global 17

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YOUR PURPOSE IS YOUR BIGGEST ASSET

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Corporate DispatchPro commitment is to achieve Zero Hunger, but as evidenced by the 47 nations that register a share of malnutrition under 10 per cent, the fight is nowhere close to its end. Trends, however, have been largely encouraging. Virtually all countries reported a steady decline in undernourishment since 2000. Angola started the millennium with a 65 per cent rate of hunger but has sharply cut it back to 27 per cent by 2020. Ethiopia, Sierra Leone, and Afghanistan made the same progress from an extremely alarming situation to a serious one over the same period. Gambia and Nepal ranked in the alarming category in 2020 but have both successfully scaled down to moderate levels. Meanwhile, another six countries went from moderate to little hunger. Venezuela is the only country to buck the trend. Less than 15 per cent of Venezuelans suffered malnutrition at the turn of the century, and that share was reduced to 8 per cent by 2012. In the last eight years, however, hunger cases have exploded and nearly a quarter of the population is now undernourished. The socioeconomic crisis that has gripped the country led to hyperinflation, forcing millions of people at risk of starvation. Events, political or otherwise, often stand in the way of the drive to stamp out hunger. The World Food Programme, in fact, estimated that the Covid-19 pandemic has doubled cases of malnutrition especially in countries already burdened by armed conflict. The effects of the coronavirus will take years to counteract, and the World Bank already predicts that goals towards 2030 may have been dented, even without considering potential pressures on food supply in the future. The accomplishments in the last 80 years should give hope that the war on hunger is not unwinnable, but every life lost to famine is a battle lost.

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Holding the field Most of the world’s food comes from the ground. Whether raw or infinitely processed, agricultural products are, by far, the largest source of nutrition.

But as countries become richer and industries diversify, food production becomes a less prominent sector of national economies. Agriculture contributes to around 1.3 per cent of the EU’s GDP and employs just over four per cent of the members’ combined workforce. In the US, less than half of that are engaged in farming, which accounts for just one per cent of the total economy. At the start of the industrial revolution, only two centuries ago, agriculture directly engaged around eight in ten people. The same tendency is observed in developing economies. The World Bank estimates that over half the labour force in low-tomiddle-income countries worked in agriculture in the early 1990s, contributing 18 per cent to national economies. Three decades later, the workforce in agriculture dropped to a third of the employed population while the share of farming in the economy shrank to eight per cent. In the meantime, food-growing has become significantly more efficient and abundant. Cereal production is at three times the levels than it was 60 years ago, and models predict that, in the next 60 years, it will increase by 41 to 44 per cent more, depending on the effects of climate change. A warming planet means that agriculture will continue to adapt, and with it, food trade. India, China, and Australia are among the biggest producers of wheat, but as temperatures rise, wheat farming is expected to shift towards higher altitudes and exported to lower altitudes. 21

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Corporate DispatchPro Since the first experiments in rice production in China ten millennia ago, cereal grains have been a major source of nutrition for civilizations. For most populations, cereals remain the single most important source of calories with consumption accounting for around two-thirds of the average intake in developing countries. That rate is higher in poorer regions that rely heavily on crops such as corn, sorghum, millet. Cereals constitute less than a third of the calorie intake in highincome countries, but this excludes indirect consumption of derivates such as refined flour and food starch from corn, or cereal-based beverages. Even as diets in affluent economies include higher shares of meat consumption, cereals remain the major feed for farmed livestock. The fast rate of change in food production methods and trade is prompting many countries to adopt strategic measures to secure supply in the long term. But, as the European Commission’s ambitious Farm to Fork initiative makes clear, nutrition will largely remain rooted in agriculture.

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Eating for your genes From low-fat to low-carb and from ketogenic to paleolithic, there was no shortage of experimental diets in recent decades. Nutrition experts leveraged food science and human biology to develop healthier eating behaviours. Almost inevitably, successful programmes adopted by millions of people are quickly demoted to the status of fads when they no longer reflect contemporary lifestyles, or when longitudinal studies and new science challenge their original claims. But the diet movement has popularised the link between food and body types, foregrounding the trend towards personalised nutrition. British physician was busy exploring the overlaps between diet and genetics as far back as the early 1900s, but the Human Genome Project completed almost a century later, provided the foundations for the disciplines of nutrigenetics and nutrigenomics. Nutrigenetics studies how different people process different nutrients based on variations in their genetic make-up. This emerging field promises to help individuals identify the foods that allow their metabolism to perform at optimal levels. The combinations of nutrients pose a direct influence on gene expression, creating a whole new sphere of study in nutrigenomics. Eating disorders are on the rise while unhealthy consumption of alcohol, caffeine, fast-foods, and other high-risk habits are exposing more people to illnesses. Now, breakthroughs in research are opening a new paradigm for nutrition, leading to gene-type diets that help to prevent and reduce a spectrum of diseases. By aligning food intake with a person’s genetic profile, personalised nutrition seeks to create unique eating protocols that facilitate physical and mental wellbeing of every individual. 25

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Varying food tastes may, in fact, be attributed to specific genetic compositions as culinary diversity between cultures shows. Understanding the correlation between genes and personal nutrition takes these nuances to a deeper level still and pave the way for the development of new food products. Nutrigenetics and nutrigenomics are still young sciences, but their importance to nutrition counselling is growing. Personal nutrition covers an extent of factors that include an individual’s lifestyle, health history, and life goals, and gene profiles add a bio-chemical dimension to particular requirements. The ancient adage wisely points out that we are what we eat, but in the future it is more likely that we eat what we are. 27

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ASIA REPRESENTS A FIFTH OF TRADE IN GOODS Exports to Asian countries accounted for 18.8 per cent of the total trade goods in the first quarter of 2021, with a combined value of €142.2 million. Imports from Asia made up 21.9 per cent, equivalent to €251.1 million, in the same period. Figures by the National Statistics Office shows a decline in exported and imported goods to and from Asian countries compared with the first three months of 2020, but the balance of trade narrowed from a deficit of €120.7 million last year to a deficit of €109. 0 million this year. The EU remains the biggest trading partner, absorbing 45.5 per cent of Malta’s total €756.7 million exports and sourcing 59.2 per cent of the €1,145.4 million imports. Imports to Italy fell from €274.4 million in the first quarter of 2020 to €197 million this year, but it was still Malta’s top trading country. Exports to Italy rose from €39.9 million to €71.6 million year-on-year, registering the biggest increase in exports. Exports to Germany, on the other hand, saw the largest decrease (€72.5M), but at a total of €96.5 million, it was the biggest destination for exports. Germany is also the only EU member with which Malta registered a surplus in the balance of trade, closing at €24.8 million. A positive balance of trade was also registered with the United States (€8.4M), Tunisia (€3.9M), and South Africa (€1.2M).

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IMPORTS FROM UK FALL BY 45% SINCE BREXIT Total imports from Britain stood at €75.3 million in the first three months since the UK’s withdrawal from the EU came into full effect on January 1, 2021. In the first quarter of 2020, imports to Malta had a combined value of €137.5 million. Figures by the National Statistics Office, however, show an increase in the flow of goods in the opposite direction as exports increased from €10.3 million in 2020 to €18.8 million this year. The balance of trade narrowed from a deficit of €127.1 million between January and March last year to a deficit of €56.5 million in 2021. In the first quarter of this year, non-EU European trading partners that include the UK accounted for 10.4 per cent of total imports in goods to Malta and 4.6 per cent of total exports. In the same period last year, imports from this country grouping made up 14.2 per cent of the total share while exports contributed to 5.4 per cent. TOTAL VALUE OF RESIDENTIAL PROPERTY SALES NEARS €230 MILLION IN APRIL Final deeds of sale for residential properties reached a combined value of €228.4 million in April, almost level with the same month in 2019. Last year, total transactions amounted to €119.2 million. Figures by the National Statistics Office show that the number of final deeds of sale amounted to 1,130 in the fourth month this year, a decrease of 153 from the previous month. Meanwhile, promises of sale totalled 1,430, the strongest April in the four years under review. The first three months of 2021 similarly registered higher numbers of promises of sale compared with the period 2018 to 2020. The south-eastern region comprising of Ħaż-Żabbar, Xgħajra, Żejtun, Birżebbuġa, Marsasklala, and Marsaxlokk attracted the most interest from buyers, with 211 promises of sale, followed by Gozo with 207. The Cottonera area recorded 15 promises of sale, the lowest number among all regions and 38 less than the second-lowest region spanning Rabat, Mdina, Ħad-Dingli, Mtarfa, and Mġarr. 30

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Corporate DispatchPro EC FORECASTS ROBUST RECOVERY Malta’s economy should see a robust recovery in 2021 and 2022, provided that the tourism sector opens up safely. In its Spring Forecast, the European Commission said that the recovery is expected to be driven by a rebound in tourism-related services exports, household consumption and investment. Given the supportive fiscal policy stance, the general government deficit is set to widen further in 2021 before improving in 2022 on the back of an accelerating recovery and a winding-down of fiscal support. In its report about Malta, the Commission noted how the pandemic has decimated tourism proceeds and made a deep dent in consumption. GDP fell significantly in 2020 with services exports and household consumption contracting sharply under the pressure of the pandemic and related safety measures. On the contrary, financial services and gaming sector exports continued to perform robustly. Although the pandemic has clearly depressed economic activity in Malta, the government’s sizeable stimulus package has managed to partially offset some of the impact. Wage supplement schemes and other business support measures appear to have cushioned the drop in consumption. OUTBOUND TOURISM DROPS BY ALMOST 85 PER CENT Two-thirds of outbound tourists in the first quarter were in the 2544 age bracket. Data by the National Statistics Office shows that just over 18,700 people left Malta for tourism purposes between January and March this year, a decrease of 84 per cent from the same period in 2020. Total estimated expenditure by visitors stood at €18 million, equivalent to €968 per person and an increase from €704 spent last year. Nevertheless, the spend per night decreased from €121 in 2020 to €58 this year. Italy was the most popular destination by far, with close to 7,000 people choosing to holiday in the Mediterranean peninsula. Almost as many travelled to other countries in the EU, mainly Germany (807) and France (797). The UK received 846 visitors from Malta, slightly more than a tenth of traffic that went to markets outside the EU. 31

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Malta News ROUNDUP Health Minister Chris Fearne announced that Malta reached herd immunity as 70 per cent of the population received at least one dose of the Covid-19 vaccine. He said that rules on facemasks will be eased from July. A 2017 deal to build and manage new residential blocks at the St Vincent de Paul residence was slammed by the Auditor General. The €274 million contract was awarded to a consortium formed by James Caterers and DB Group. Five language schools ceased operations following months of uncertainty caused by the Covid-19 pandemic. The federation of English language schools said that the decision by the unnamed organisations shows the severity of the situation. House Representative Marlene Farrugia tabled a Private Member’s Bill proposing the decriminalisation of abortion. The independent MP said that she remains pro-life but argued that women should not be imprisoned for seeking an abortion. The president of the catering lobby, Tony Zahra, said that the return to business after a two-month ban was better than expected. Zahra said that restaurants are looking forward to a good season, especially towards late summer. Electrogas director Paul Apap Bologna was summoned by the Public Accounts Committee to answer questions about the power station. He denied allegations that a pre-electoral deal for the project had been reached with the Labour Party. 35

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Corporate DispatchPro An inmate reported that he was taken into solitary confinement and banned from using the prison telephone after making public claims that the Corradino Correctional Facility management was using systematic terror and torture. Foreign Affairs Minister Evarist Bartolo called for a ceasefire in Gaza during a meeting with Palestinian counterpart Riyad al-Maliki. Bartolo expressed concern about the escalation in the territory and reiterated Malta’s support for the two-state solution. Minister Carmelo Abela confirmed that he was called in for questioning by the police following claims that he was involved in an attempted heist on HSBC bank in 2010. The minister rejects the allegations. The Finance Ministry dismissed claims that businessman Charles Polidano was granted a reduction to his tax bill after a meeting with senior government officials. Reports said that the construction tycoon has accumulated €40 million in arrears.

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Crime shouldn’t pay: Why fighting money laundering matters Among the most pervasive threats to the international economy over the past century, money laundering – or the act by which criminals seek to clean illegally-made gains – has rapidly risen among the concerns of governments and citizens alike. The reasons for this uptick in concern are twofold, namely a larger realisation of the wide extent of this phenomenon – with the United Nations suggesting that up to two trillion dollars are being laundered each year – and to the severe impact this crime has on wider society. While citizens are generally aware that money laundering is a crime that needs to be dealt with, often it is seen as merely a criminal activity having little impact on the rest of us. Rather, money laundering means more drugs, violence and crime on our streets. Money launderers generally use illegal businesses to clean their funds and in doing so they have no concern about underpricing their operations, giving the business an unfair competitive advantage. Numerous studies show that financial crime slows down economic growth, diverting tax proceeds from investments that impinge on our wellbeing such as education and health, meaning that eventually we all lose out. As part of the international community, Malta is not immune to these challenges and it is against such a background that the country has significantly stepped up its efforts and invested heavily in the fight against financial crime and safeguarding Malta’s reputation. 39

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These efforts included an unprecedented legislative and regulatory reform intended to strengthen the technical compliance framework and support the fight against money laundering while sending a clear message that no deficiencies in AML compliance will be tolerated. Such changes included the establishment of a Central Bank Account Register for Malta, the introduction of restrictions on cash-based transactions related to high-value and luxury goods, amendments to improve the practice of AML by subject persons, a significant reduction in the period within which suspicious transaction reports ought to be reported, as well as the right for the Financial Intelligence Analysis Unit (FIAU) to impose penalties which are effective, proportionate, and dissuasive. Implementation of this framework sees a number of stakeholders working together in this process. The FIAU, Malta’s anti-money laundering agency, is responsible to supervise the markets, in observance with the applicable laws, regulations and implementing procedures. When necessary, it takes remedial action, through enforcement and sanctioning. The Malta Financial Services Authority and the Malta Gaming Authority are important agents in this regard. When reasonable suspicion of money-laundering is identified, the FIAU forwards this information to the Police which is then responsible to undertake the necessary investigations and criminal action if

These efforts included an unprecedented legislative and regulatory reform intended to strengthen the technical compliance framework

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Corporate DispatchPro Supervisory Strategy to ensure more effective compliance of subject persons. This has resulted in more meaningful enforcement, heftier sanctions and numerous remediation directives. But a strong AML strategy is not solely about imposing fines but, more importantly, about providing regular and qualitative support.

necessary. At all levels, institutions have significantly increased their operational capacity, both in terms of human resources and technological prowess. Such investment has immediately delivered tangible progress. Last year alone, the FIAU submitted over 70 analytical reports to the police indicating a reasonable suspicion of ML/FT and over 100 other disseminations consisting in additional intelligence reports. Over the past two years, the FIAU has also overhauled its AML Supervisory Strategy to ensure more effective compliance of subject persons. This has resulted in more meaningful enforcement, heftier sanctions and numerous remediation directives. But a strong AML strategy is not solely about imposing fines but, more importantly, about providing regular and qualitative support. Malta’s success in upping its game against financial crime is also a reflection of a stronger recognition of the importance of such efforts by businesses themselves, and the past years have seen significant investment by the private sector, leading to a higher level of compliance, so much so that last year, over 5,000 suspicious reports were filed by subject persons in Malta, proving their role as an importance first line of defence. This tangible progress is testament to the fact that progress in preventing and fighting financial crime is by combining the efforts of both public and private sector, efforts which will help shoreup Malta’s reputation and strengthen its position as a European jurisdiction of repute. 41

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Human rights approach needed regarding cannabis legislation “The war on drugs has failed and a human rights approach is needed on the matter,” Maltese MEP Cyrus Engerer said.

The Labour Party MEP was speaking after his office organised one of the biggest pan-European conferences on cannabis for personal use, in conjunction with Encod. The MEP made submissions to the national government after it proposed that cannabis users should be allowed to grow their own plants at home and legally carry up to 7 grams of the drug for personal use. “In submissions to Government, we emphasised the need to steer users away from the black market and big pharma, and move towards growing or buying the product in a trustworthy and sustainable manner,” Engerer said. “Therefore, moving not only towards decriminalisation but also the legalisation of cannabis growing for personal use and its eventual use. In this sense, we have recommended the use of cannabis social enterprises, as in Uruguay, where those who do not have access to grow their own four plants would be able to pool resources with others in a regulated environment, to grow their own strains,” he added. 43

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Human rights, safety and community should be put on the forefront of the debate, the MEP said. The government proposals, which have opened up to public consultation, also open the door to creating a legalised market for cannabis flower and seeds, with Prime Minister Robert Abela saying the government would be listening to proposals about how the drug could be sold legally. “We want a regulated source where people can buy cannabis and its seeds. I believe this will be key to eradicating the black market, together with continued enforcement of existing laws,” Abela said. Penalties for cannabis trafficking will remain unchanged. Labour MP Rosianne Cutajar, who spearheaded work on cannabis reform when she served as junior minister for reforms, said the proposals would create a fairer system for responsible cannabis users. This article is part of a content series called Ewropej. This is a multi-newsroom initiative part-funded by the European Parliament to bring the work of the EP closer to the citizens of Malta and keep them informed about matters that affect their daily lives. This article reflects only the author’s view. The European Parliament is not responsible for any use that may be made of the information it contains.

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The Maltese need to be protected from their own government’ Maltese and Gozitan families need to be protected from their own government, since the Labour government is protecting criminals, MEP David Casa said. He was speaking after the European Parliament approved a resolution which called on the Maltese Government to act, mainly to ensure that all those involved in the murder of Daphne Caruana Galizia are brought to justice. It also asked that all those cases of corruption and money laundering which Daphne Caruana Galizia revealed, are investigated. “All the Members who participated in the debate in the European Parliament - except for the four MEPs of the Maltese Labour Party insisted that the situation in Malta needs to change. In my speech, I made it clear that I will not stop until all those involved in the murder, including those who ordered the murder to take place, are in jail,” David Casa said. In a resolution, the European Parliament said it was deeply concerned about the latest revelations in the investigations into the assassination of Daphne Caruana Galizia, in particular the possible involvement of government ministers and political appointees. It said it acknowledged the progress made in the murder investigations. However, it reiterated that the recent revelations raise new questions about the case and related investigations.

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“Journalists will only be protected if their work is truly investigated by the institutions, and that those involved in corruption and money laundering cases face justice,”

Fellow Maltese Nationalist Party MEP Roberta Metsola said that the resolution makes it clear that the underlying problem is not the people of Malta but the government who, not only has high officials implicated in corruption, money laundering, heists and murders, but it is the same government who protects those involved in such criminal acts. The two MEPs also spoke about the importance of having a free media, with journalists protected, to be able to investigate corruption, and reveal the truth. “Journalists will only be protected if their work is truly investigated by the institutions, and that those involved in corruption and money laundering cases face justice,” they said. In a statement, the Labour MEPs said the resolution is “unjust” and paints “a false and twisted picture of the reality of politics and the judiciary in Malta”. The Labour MEPs said in light of this, their choice was a clear one – to vote against the resolution. “After the members of the [Labour] delegation voted against the resolution, because it is neither correct, nor balanced or at the right time, they will continue to work hard so that the truth comes out in Europe as well as in Malta,” the statement said.

This article is part of a content series called Ewropej. This is a multi-newsroom initiative part-funded by the European Parliament to bring the work of the EP closer to the citizens of Malta and keep them informed about matters that affect their daily lives. This article reflects only the author’s view. The European Parliament is not responsible for any use that may be made of the information it contains.

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Corporate DispatchPro KEITH ZAHRA

HEALTH AND TRAVEL

EU Digital COVID Certificate: EP and Council reach agreement on Commission proposal The European Parliament and the Council on the Regulation have reached a political agreement governing the EU Digital COVID Certificate. This means that the certificate (previously called the Digital Green Certificate) remains on track to be ready by the end of June, as planned. Following the agreement, the EU Digital COVID Certificate will cover Covid-19 vaccination, test or recovery and be available in a digital and paper-based format. It will be free of charge and Member States may use it for national purposes, if this is provided for in national law. Member States shall refrain from imposing additional travel restrictions on the holders of an EU Digital COVID Certificate, unless they are necessary and proportionate to safeguard public health. Finally, the Commission will also mobilise €100 million to support member states in providing affordable tests. The Regulation will enter into force on 1 July, with a phasing-in period of six weeks for the issuance of certificates for those member states that need additional time.

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Corporate DispatchPro KEITH ZAHRA

SECURITY

More thorough checks for firearm licences from next year The Commission has introduced new rules on the systematic exchange of information between member states on refusals to grant authorisations to own a firearm. An estimated 30,000 refusals are issued each month within the EU on security grounds.

The delegated regulation will enable the relevant national authorities to check, using the Internal Market Information IT System, whether someone applying for a firearm licence has been denied a similar authorisation in another member state. This will prevent ‘jurisdiction shopping’ by people who attempt to circumvent prohibitions. Improving the legal control of firearms is a priority of the EU Action Plan on firearms trafficking for 2020-2025. The new rules will contribute to protecting Europeans from organised crime and terrorism, in line with the Counter-terrorism Agenda presented in December 2020 and the EU Strategy to tackle organised crime put forward last month. The new rules will apply as of 31 January 2022.

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Corporate DispatchPro KEITH ZAHRA

INTERNATIONAL RELATIONS

EU to discuss EEA states’ financial contribution for 2021-2027 The Council has adopted a decision authorising the opening of negotiations with Iceland, the Principality of Liechtenstein and the Kingdom of Norway for an agreement on the future financial contribution of the EEA EFTA States to social and economic cohesion in the European Economic Area. The Council also adopted negotiating directives which constitute a mandate to the Commission for the negotiations. On the basis of this mandate, negotiations should now be conducted and concluded swiftly, in order to ensure that the instruments for adopting the above arrangements enter into force as soon as possible, taking into account the timeline of the next seven-year-period for the EU cohesion policy instruments. Following the expiry of the EEA and Norway Financial Mechanisms 20142021 on 30 April 2021, the new mechanism for financial contributions from the three partner countries will be aimed at alleviating social and economic disparities in the European Economic Area in the period 2021–2027.

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Corporate DispatchPro KEITH ZAHRA

HEALTH

The Tobacco Products Directive: Five years on The European Commission published its first report on the Tobacco Products Directive, five years after it became applicable in 2016. Following the introduction of this Directive, the EU has witnessed steady decreases in smoking rates and tobacco use. However, more efforts are needed, the report said, particularly enforcement at national level and better consideration of new market developments, such as novel tobacco products. With 27 per cent of all cancers attributed to its use, tobacco is the single largest avoidable health risk in the EU. Europe’s Beating Cancer Plan, a key pillar of the European Health Union aims at creating a ‘Tobaccofree Generation’ by 2040. To reach this highly ambitious goal we need timely mobilisation of the whole available arsenal of tobacco control tools at all levels. The report identifies progress made and where there is still room for improvement. It finds that the EU legislation has enhanced tobacco control, contributed to protecting the health of EU citizens by providing member states with strong rules to address the use of tobacco products in the EU. The Directive has put in place comprehensive EU tobacco control policy rules, notably through enlarged combined health warnings, a track and trace system, a ban on characterising flavours, the creation of an ingredients database and the regulation of electronic cigarettes. It has also contributed to the improvement of public health through a decrease in tobacco consumption. The report also concludes that, due to market developments, there is scope for improvement in certain essential areas such as labelling, assessment of ingredients, crossborder distance sales and novel and emerging products. 57

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Corporate DispatchPro LISA JUCCA VIA REUTERS BREAKINGVIEWS

Ray-Ban maker may finally live up to merger vision EssilorLuxottica (ESLX.PA) may finally live up to its merger vision. The Paris-listed company on Friday ended the power-sharing pact underpinning the 2018 union that brought together the Italian maker of Ray-Ban sunglasses with the French purveyor of Varilux lenses. Axing duplication should enable the 63 billion euro giant to cut costs faster while wiping out a persistent discount.

The world’s biggest eyewear player has spent three years grappling with a clumsy governance structure. Luxottica founder Leonardo Del Vecchio, the company’s largest shareholder with a 32% stake, agreed to share power with his French partners on a 16-member board. The arrangement led to high-profile spats between the two sides. The company also struggled to install a single chief executive, opting instead for an unnecessary duplication of top management roles. EssilorLuxottica has now fixed its governance. The company’s new board is smaller and comprises mostly independent directors. By approving Del Vecchio as chairman and his trusted aide Francesco Milleri as chief executive, shareholders have given the Italian duo an unchallenged grip. The clearer management structure should help unlock up to 300 million euros of annual cost savings arising from the EssilorLuxottica merger, promised by 2023. Though the figure is a modest 2% of the companies’ combined operating expenses in 2019, analysts estimate only 50 million euros has materialised so far. EssilorLuxottica could save a further 200 59

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Corporate DispatchPro Its stock has persistently lagged industry rivals like Japanese lens maker Hoya and luxury groups such as Kering

million euros if it completes the 7 billion euro acquisition of optical retailer GrandVision (GVNV.AS), says Morgan Stanley. The combination of lower costs and firmer leadership should help EssilorLuxottica narrow a persistent valuation discount. The group, which will soon control 20% of the global eyewear market, has no clear rival. Yet its stock has persistently lagged industry rivals like Japanese lens maker Hoya (7741.T) and luxury groups such as Kering (PRTP.PA). EssilorLuxottica shares currently trade at around 28 times forecast earnings for 2022, according to estimates compiled by Refinitiv. That’s a 21% discount to the average rating for 15 other eyewear, medical technology and consumer goods groups. Narrowing the gap could add at least 10 billion euros to EssilorLuxottica’s value There are risks. Milleri, who was little known in international financial circles before the merger, will have to prove he is up to the job. The company’s scale and cleaned-up governance mean he has few excuses.

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Corporate DispatchPro GEORGE HAY VIA REUTERS BREAKINGVIEWS

North Sea oil IPOs had best take the plunge soon North Sea oil companies hoping to float should strip off and take the plunge. Sam Laidlaw, formerly boss of UK utility Centrica (CNA.L), is mulling an initial public offering of Neptune Energy, the driller controlled by buyout groups CVC and Carlyle, as well as China’s sovereign wealth fund. His chances of achieving a $10 billion valuation look better if he moves swiftly.

After a recent rush of new listings, investors are showing signs of indigestion. Shares in food delivery group Deliveroo (ROO.L) are languishing 35% below their March debut price, and a bunch of smaller Spanish renewable energy groups recently pulled their listings. Laidlaw also faces competition: Oil driller Wintershall Dea said in February its mooted $20 billion IPO would be done some time this year. Neptune has some compelling reasons to nip in front, though. Brent oil prices that last year sank below $20 a barrel are back up near $70, buoyed by the post-pandemic recovery and a forthcoming supply crunch. Meanwhile, the influential International Energy Agency said last week that gas demand needs to peak around 2025 if the planet is to restrict global warming to 1.5 degrees Celsius above pre-industrial levels. Previously investors could assume several more decades of growth in demand for gas, which emits less carbon than oil and coal. If the IEA is right, the fact that Laidlaw’s company counts 72% of its proved and probable reserves as gas is less alluring. Neptune’s mooted valuation also looks punchy. U.S. oil groups like Chevron (CVX.N), ConocoPhillips (COP.N) and Exxon Mobil (XOM.N) sold their assets in the North Sea at valuations of around $10 to $15 per 63

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barrel of proven and probable reserves. Adding Neptune’s $2 billion of net debt to a $10 billion equity valuation, and dividing it by its 601 million barrels of reserves, implies a valuation of almost $20 per barrel. Neptune’s assets are geographically diversified and therefore better hedged against price movements in different gas markets. Laidlaw can also sell investors a growth story whereby reserves will hit 800 million barrels, reducing the valuation to less than $15 per barrel. But the public markets are only becoming less welcoming for fossil fuel groups. He shouldn’t hang about. 65

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Corporate DispatchPro PETE SWEENEY VIA REUTERS BREAKINGVIEWS

Bike sharing shifts into a more manageable gear Bike-sharing companies are back in the saddle after a brutal wipe-out. Survivors are now pedalling their way onto public markets in a fresh test of investor endurance.

China invented so-called “dockless” shared bicycles: hardy vehicles unlocked by smartphone and left anywhere for the next user. Mobike and Ofo spawned dozens of imitators at home and abroad. A price war ensued, while bike-strewn sidewalks irritated municipal officials, who cracked down. The collapse was brutal: Ofo had raised $2.2 billion, per Crunchbase, before it failed. Yet the concept, now extended to electric models too, still appeals to commuters seeking to shorten the so-called last mile between subway stations and final destinations. With the sector no longer swamped by entrants offering free rides, pricing models are rationalising. And public nuisance concerns are being addressed with artificially intelligent “geofencing,” which turns off electric models when they enter prohibited zones and disables bike locks. There are new sources of revenue too. Patrick Davin, founder of Mute, says he sells his scooter data to advertisers and companies wanting to analyse transit habits. One major electric car manufacturer even offered to supply him with free vehicles in exchange for movement pattern information, letting him keep rental fees - near-instant operating profit. New investors will soon opine on these improvements. Ford Motor (F.N) is considering selling its scooter-sharing service Spin, Bloomberg reported last week. China’s Hello, which says its Hellobike brand is the country’s largest provider of shared bikes and e-bikes with some 183 million users, recently disclosed plans 67

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Corporate DispatchPro for an initial public offering in New York. The Ant-backed company reported a post-pandemic 89% surge in bike-sharing revenue in the first quarter, to $180 million, from a year earlier, as overall losses narrowed. California-based Bird, meanwhile, is going public by way of Switchback II’s (SWBK.N) special purpose acquisition company in a deal that values the electric scooter enterprise at $2.3 billion. Although its top line is rebounding like Hellobike’s, Bird expects it will take until 2023 before adjusted EBITDA turns positive. The valuation represents 12 times projected 2021 sales, where Uber Technologies (UBER.N) trades at 9 times. Even with spiffier bikesharing business models, investors may be wary of being taken for another ride.

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Corporate DispatchPro

BRIDGING THE INVESTMENT GAP

SUPPORTING SMEs, INNOVATION, INFRASTRUCTURE & SOCIAL INVESTMENT

CorporateDispatch Pro - Edition 20

Articles inside

North Sea oil IPOs had best take the plunge soon

Ray-Ban maker may finally live up to merger vision

Bike sharing shifts into a more manageable gear

The Maltese need to be protected from their own government

Communiqeu

Human rights approach needed regarding cannabis legislation

Malta Insights

Crime shouldn’t pay: why fighting money laundering matters

Month in pictures

Shooting the messenger

Holding the field

Malta News Roundup

Eating for your genes

The sweet and sour of hunger action