MALTA Law and Practice Contributed by: Rosanne Bonnici and Rebecca Diacono, Fenech & Fenech Advocates
member states will apply the rules of the Regulation even in cases involving citizens or residents of third countries (eg, Switzerland or the USA), particularly if they own assets such as immovable property and real estate within the EU. The Regulation achieves a degree of harmonisation of private international law rules, enabling individuals to organise their succes - sions more efficiently and more rapidly within the area of freedom, security and justice. Although only EU member states and EU residents are technically bound by the Regulation, it is intended to apply to estates on a worldwide basis. The law appli - cable to the succession of the deceased as a whole shall be that of the deceased’s country of habitual res - idence at the time of death, unless the deceased has opted to apply the succession laws of their country of nationality. In more recent times, the availability of second passports for high net worth individuals may have an impact on this aspect of their lives, in terms of giving them more options in the choice of applicable succession laws. 2.3 Forced Heirship Laws The Civil Code provides for a form of forced heir - ship, whereby a portion of the deceased’s property is reserved by law in favour of the descendants and the surviving spouse of the deceased. Accordingly, the descendants and/or the surviving spouse of the deceased are generally entitled to a credit of the value of the reserved portion against the deceased’s estate. Interest at the rate of 8% accrues to such credit from the date of the opening of suc - cession if the reserved portion is claimed within two years from such date, or from the date of service of a judicial order if the claim is made after the expiry of said two-year period. The actual amount reserved is regulated by law and depends on the existence of surviving descendants and/or a spouse, if any. In terms of the Civil Code, it is unlawful for the testator to encumber the reserved portion with any burden or condition and, therefore, the reserved portion is calculated on the whole estate after deducting the debts due from the estate and any funeral expenses incurred. To this end, the estate is deemed to include the property disposed of by the
testator under a gratuitous title, even in contemplation of marriage, in favour of any person whomsoever, with the exception of such expenses as may have been incurred for the education of any of the children or other descendants. Deprived/Reserved Inheritance Besides the grounds on which a person may become unworthy to inherit generally (as defined in the Civil Code), the persons entitled by law to a reserved por - tion may also be deprived of the reserved portion if the testator makes a specific declaration to this effect based on special grounds specified in the Civil Code. This declaration must be stated in a will of the testator. In relation to the reserved portion, the law provides that testamentary dispositions exceeding the dispos - able portion shall be liable to abatement and limit - ed to that portion at the time of the opening of the succession, provided that a demand for abatement is made within the time established by law. For the purposes of calculating the abatement, the property of the deceased shall be deemed to include all their property at the time of death, including property dis - posed of by donation (calculated on the value at the time of the donation). It is legally possible to renounce a person’s right to the reserved portion. The Civil Code caters for the following three types of marriage contract, more commonly referred to as matrimonial regimes: • the community of acquests; • the separation of estates; and • the community of residue and separate administra - tion. Community of acquests In terms of the Civil Code, the community of acquests shall apply by default to a marriage celebrated in Mal - ta, in the absence of an agreement to the contrary. The spouses are free to choose a matrimonial regime other than the community of acquests to regulate their mar - riage, but this is the default regime if they fail to do so. 2.4 Marital Property Matrimonial Regimes
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