Importers of second-hand cars said on Tuesday that the government had dismissal their suggestions to negotiate a derogation from the EU-UK Brexit agreement that would have Malta considered as a disadvantaged state due to the norms in traffic rules inherited from the UK and thus the need to import right-hand drive cars.

The importers, grouped in the  Malta Car Importers Association, said they had held a meeting with Finance Minister Clyde Caruana and Transport Minister Ian Borg regarding added fees and bureaucracy caused by Brexit.

Recent official figures showed a sharp decline in the imports of second-hand cars - which used to come mostly from the UK. The figures showed that for the first time in years, imports of new cars were higher than used car imports.

The association said it expressed concern that most of its 75 members "are in a dire financial state and require intervention from the government due to imbalance caused in the local market".

The MCIA executive committee said it put forward proposals to address the current situation, including the derogation, but it was immediately dismissed by the government, stating that the European Commission would not be forthcoming on this matter.

"Even though the Executive Committee insisted to initiate formal discussion, the position from government remained unchanged."

Also discussed were adjustments to Value Added Tax. The government delegation agreed that efforts would be made to ensure that a double taxation situation does not occur.

The government also agreed that it will request an opinion on whether rules of origin apply for goods originating from EU countries, sold to the UK and then resold back to EU member states. Should this be the case, according to the Free Trade Agreement with the UK, there would be zero tariffs and zero quotas on goods that comply with the appropriate rules of origin.

The association said talks between the two sides will continue.