“Malta finds itself navigating a delicate balance between the EU’s drive for centralisation and Malta offering a competitive edge over its European counterparts,” said Dr Conrad Portanier in his opening address at Ganado Advocates’ 11th Annual Banking and Payments Seminar last month.
Co-hosted with the Malta Bankers’ Association, the event brought together senior figures from banking, payments, legal, and regulatory communities.
Opening the annual seminar, Dr Portanier, Partner and head of Ganado Advocates’ Banking and Finance team, warned that Europe’s fragmented financial landscape creates strategic vulnerabilities, particularly amid rising geopolitical tensions and a growing reliance on overseas payment systems.
As the EU adopts a more centralised approach, Malta may need to rethink its strategy for attracting foreign investment, since its Unique Selling Points may be changing.
“The strategies that succeeded over the past 22 years may not be as effective in the future and it will be vital for Malta to re-evaluate where it can offer value over other European jurisdictions,” he said.
He noted that historically the island gained substantial foreign direct investment when it pioneered legislation in private law spheres, such as with the introduction of trusts law, shipping mortgages and insolvency setoff and netting.
“The next challenge will be to enact a robust private law relating to digital or tokenised assets, in particular, a law allowing tokenised assets to serve as collateral under Maltese law.”
Malta Bankers Association Chair Kenneth Farrugia noted how as Europe moves towards the digital euro, it will be crucial that innovation is matched by legal and regulatory clarity.
“Financial institutions in Malta and across the EU are ready to support a digital euro that strengthens market integration, enhances efficiency, and safeguards financial stability. Success, however, will depend on a harmonised framework that provides certainty for banks, businesses, and end users alike, ensuring that this initiative complements existing systems, while fostering trust and confidence in the digital financial ecosystem yet does not impact in a material manner the funding side of banks’ traditional intermediary role.”
Professor Christos Gortsos, Professor of Public Economic Law at the National and Kapodistrian University of Athens delivered his keynote address on the legal challenges of establishing a digital euro and argued that the framework must address not only the euro’s legal tender status but also its practical implications for users, banks, and payment service providers.
“The digital euro must be grounded in a clear and comprehensive legal framework that defines its issuance, legal effects, and institutional responsibilities to ensure legal certainty for users and alignment with the European Central Bank’s Treaty mandate. Without explicit provisions on these points, the initiative risks legal uncertainty, fragmented adoption across Member States, and potential conflicts with existing banking and payment systems,” he said.
Professor Gortsos stressed that the legal nature of the digital euro under private law remains one of the most pressing questions.
“The choice of design, whether account-based, token-based, or hybrid, will determine how ownership and transfers are recognised, the rights of holders against other parties, and whether central bank liabilities grant proprietary rights similar to traditional currency. These considerations are essential to ensure the digital euro interacts coherently with existing private law doctrines governing currency, contracts, and property, and to avoid fragmentation across the EU,” he added.
While the Commission’s draft Regulation proposes that the digital euro be accepted for payment obligations at full face value, Professor Gortsos noted that significant interpretive questions remain.
“How should legal tender be defined in a digital context? How does mandatory acceptance interact with contractual freedom? And what limits, such as holding caps, can be imposed to safeguard financial stability and prevent bank disintermediation?” arguing that clear, carefully drafted provisions are vital to ensure the digital euro complements existing money and payment systems without undermining stability or user confidence.
Mario Zerafa from Ganado Advocates then outlined how board members of licensed entities needed to prepare and respond to the challenges posed by the new EU AML Package and the impact which the Anti-Money Laundering Authority (AMLA) will have on Maltese operators.
The session then split into two focused sessions: the banking session centred around upcoming consumer credit developments, whereas the payments sessions honed into recent trends and outlooks of next-generation payments.
After the break-out sessions, professionals from the banking and payments industries gathered for a lively networking drinks reception where attendees exchanged ideas and forged new collaborations.
