Sources close to the Malta Transport Authority (ADT) confirmed to this newspaper that there are between 200 and 400 car dealers who have no licence to trade in cars, and are thus avoiding Value Added Tax and payment of insurance and permit fees.
To add insult to injury, most of these car dealers park their cars on pavements, roundabouts, in empty fields and in other prominent places in order to market and sell them.
Moreover, by law, these cars should not display a “For Sale” sign or signs with telephone or mobile numbers.
The auto dealers – both the legal and illegal ones – are skirting around the regulations by affixing fluorescent posters with arrows or simply the name of the auto dealer because the regulations do not prohibit this.
The sources said the road licence of most of the cars being sold by dealers has expired between the date the car was bought and the date it was re-sold.
If a car is being stored inside a garage owned by the dealer the licence does not necessarily have to be renewed.
However, if the car is parked outside, in a legal parking space, it must have a valid road licence.
The source explained that for a motor car dealer to operate, he first has to submit an application with the Malta Environment and Planning Authority for a permit. After this is obtained, the dealer has to apply for another permit from the Trade Licensing Unit. The third and final permit must be obtained from the ADT and a yearly fee of Lm100 must be paid for a permit to trade.
Along with this permit, the ADT also issues a trial run plate to every dealer for Lm200, which covers insurance for the car on which it is being used. They also have to pay another Lm50 a year to the local council in whose area they operate.
The source said there are just over 230 auto dealers registered with the ADT in Malta and Gozo. Between 200 and 400 more are operating illegally.
A spokesman for the Malta Chamber of Small and Medium-sized Enterprise confirmed this information, adding that the authorities are doing very little to ensure fair competition between those who are licensed and those who are not.
“We have been telling the authorities, mainly the police and the Administrative Law Enforcement, about this abuse but our complaints seem to be falling on deaf ears. The licensed auto dealers are suffering because of unfair competition and we can do nothing about it if the authorities continue to tolerate the present situation. In addition, these unlicensed dealers are giving a bad name to the licensed ones” he said.
The spokesman added that they have held various meetings with ministers, former ministers and parliamentary secretaries including Censu Galea, Tonio Borg, John Dalli and Edwin Vassallo. They all agreed that this is a matter that needs to be looked into as soon as possible because of the considerable loss of revenue. However, after these meetings, no more feedback was received and complacency has reigned ever since.
He said the police are encountering difficulties in tracing the car dealers since the cars they buy in order to re-sell are not being transferred into their name.
Meanwhile, a number of dealers who spoke to The Malta Independent yesterday complained about the ADT Licensing and Testing Directorate and the service it gives.
“There is absolutely no customer service at the ADT. They are arrogant and they don’t seem to have discovered this principle yet. Their customer relations are non-existent. There is only one window where the car dealers can transfer car ownership,” they said.
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