❔ How big is the global yacht fleet?
It is difficult to estimate the exact size of the global yacht fleet. However, it is estimated that there are several hundred thousand yachts worldwide.
Superyachttimes.com reported the global fleet afloat to be 9,198 yachts afloat as of today.
It’s important to note that the number of yachts in circulation may be understated, especially in countries where yacht registration is optional.
❔ Where should I register my yacht?
Where you register your yacht will depend on several factors, including where you plan to use the yacht, your nationality, and the type and size of the yacht.
It’s important to note that different countries have different registration requirements and laws, and some countries may have restrictions on foreign-flagged vessels operating in their waters. Hence, it’s essential to check with the relevant authorities before deciding where to register your yacht.
Some common options for yacht registration include:
The country where you reside: If you are a resident of a country, you may be able to register your yacht in that country. This is often the easiest option, as you will be familiar with the laws and regulations, and you may be able to take advantage of any tax benefits that apply to residents.
The country where the yacht is based: If your yacht is based in a specific country, you may choose to register it there. This is a common option for yacht owners who frequently use the yacht in that country’s waters.
Flag of Convenience (FOC) countries: Some yacht owners choose to register their yacht in a “flag of convenience” country, such as Panama, the Marshall Islands, or the Bahamas. FOC countries are often chosen for their more relaxed regulations, lower taxes, and greater privacy.
FOCs often receive bad publicity with their yachts and are known to come up against various challenges from Customs and Port State Control. For this reason, we would always recommend a jurisdiction that is well-established, stable and home to an internationally respected flag of choice whilst still meeting your broader objectives and requirements.
It is also advisable to consult a maritime lawyer or a yacht registration company to help you with the process and ensure that your yacht complies with international maritime laws.
At Sentient International, we can guide where to register your superyacht.
❔ What is the Red Ensign Group?
The Red Ensign Group (‘REG’) is a group of British shipping registers made up of the United Kingdom, the Crown Dependencies (Isle of Man, Guernsey and Jersey) and the UK Overseas Territories (Anguilla, Bermuda, British Virgin Islands, Cayman Islands, Falkland Islands, Gibraltar, Montserrat, St Helena and the Turks & Caicos Islands.
Where a vessel is registered in one of these jurisdictions, it is considered a ‘British ship’ and is entitled to fly the Red Ensign flag.
❔ Will cruising within the EU be a VAT issue?
VAT is a complex issue and can be confusing for yacht owners cruising within the European Union (EU), particularly as VAT laws vary from country to country.
In general, VAT is a tax applied to the provision of goods and services within the EU and is usually charged at the point of sale. However, when it comes to yachts, the rules can differ.
In the EU, yachts can be subject to VAT when they are used for commercial or charter purposes or if EU residents use them for more than 183 days per year.
If you are an EU resident and plan to use your yacht for recreational purposes, you will not typically be required to pay VAT on the yacht. However, if you plan to charter your yacht or use it for commercial purposes, you will typically be required to pay VAT. Additionally, if you use your yacht in EU waters for more than 183 days per year, you will typically be required to pay VAT on the yacht.
Non-EU resident owners of private yachts registered with a non-EU flag can use the Temporary Admission regime, which, subject to meeting the broader TA conditions, allows them to operate their vessel privately in the EU without the need to import their yacht formally.
It is important to note that VAT laws can vary from country to country, and there are multiple moving parts to consider. For this reason, appropriate professional advice should always be sought. It is also important to keep accurate records of the location and usage of your yacht to avoid any potential penalties or fines from the local authorities.
❔ How long is the yachting season?
The length of the yachting season can vary depending on the location and type of yacht, and also the type of sailing you are looking for. Some yacht owners may choose to sail in winter or colder weather, while others prefer the summer season.
In general, the yachting season refers to the period when the weather is suitable for recreational boating and when yacht charter companies and marinas are open for business.
In tropical locations, such as the Caribbean or the South Pacific, the yachting season is typically year-round, with the best weather conditions from December to April.
In Mediterranean locations, such as the Greek islands, the Balearic Islands, or the French Riviera, the yachting season is generally from April to October, with the peak season from June to September.
In colder climates, such as the Baltic Sea or New England, the yachting season is usually from May to September.
❔ What is the difference between owning and chartering a yacht?
If you own a yacht, the asset belongs to you. As an owner, you can subsequently choose to operate the yacht on a commercial (for charter) or pleasure (for private use only) according to your preference or individual needs and requirements.
If you charter a yacht, you effectively pay a fee to rent (charter) a yacht, which belongs to a third party, for an agreed period with a pre-arranged itinerary of where you will cruise whilst on board. Charters are normally for vacation purposes although they can also be used for business trips or events.
❔ Can a company own a yacht?
Yes, a company can own a yacht. It is highly recommended that a high-value luxury asset like a yacht is not owned by an individual directly.
Instead, it is better to own the yacht through a company or trust structure, which can offer fiscal benefits as well as limitation of liabilities. For more information check out our Yachting Services brochure.
❔ What is a Certificate of Registry?
A Certificate of Registry, also known as a Registration Certificate, is a legal document that confirms a yacht’s registration with a specific country or jurisdiction.
A Certificate of Registry is required for a yacht to legally operate in the waters of that country or jurisdiction. It is also required to prove the yacht’s nationality, which is important in cases of disputes or accidents.
The certificate includes details of the yacht including its name, registration number, type, length, tonnage, IMO number, and the name of the registered owner. It also states the port of registry and the flag under which the yacht is registered.
It is important to note that a Certificate of Registry is not the same as a Certificate of Survey, which is issued by a classification society and certifies that a yacht meets certain safety and construction standards.
❔ What is the Temporary Admission Regime?
Temporary Admission (TA) is a customs tax relief regime that permits non-EU owners to use their yachts freely within EU waters for a specific period with full or partial exemption from import duties.
Fundamentally, a non-EU individual with a non-EU owning entity and a non-EU flagged vessel (subject to meeting the broader TA conditions) can operate their vessel privately in the EU under TA without the need to formally import it, therefore avoiding Customs formalities, inevitable import VAT costs and structuring costs associated with EU importations.
Take a look at our Temporary Admission infographic for more information.
❔ Can I register my yacht in my name?
Yes, it is possible to register your yacht in your name however, each flag state has their qualifying criteria for both individuals and corporates depending on where they are residents and most will have a qualifying owner’s schedule, which lists the accepted jurisdictions of which you should be a citizen.
For individuals resident in a jurisdiction that is not on the qualifying list, ownership via a company incorporated in an accepted jurisdiction will be required to register the yacht.
Other countries may have different requirements for yacht registration, such as proof of residency, tax compliance, and compliance with local maritime laws and regulations. It’s important to check with the relevant authorities in the jurisdiction where the yacht will be registered for specific requirements.
Depending on the size of your yacht, you may wish to consider owning and registering your yacht through a corporate structure. It is recommended that a high-value asset such as a yacht, is better owned through a company, even more so when it is to be engaged in commercial activity, as it provides a layer of confidentiality, offers some form of asset protection and can limit an owner’s liability should there ever be a claim.
❔ What is a Ship Representative Person?
In several yachting jurisdictions, where the owner of a vessel is not resident or does not have their principal place of business in the jurisdiction of registration, they are required to appoint a Ship Representative Person (or ‘representative person’) in connection with the vessel before they can register it under that jurisdiction’s flag.
The representative person must ordinarily be an individual that is resident in said jurisdiction, or a company incorporated and having a place of business there. The function of the representative person is to enable the flag state in question to serve specific documents about the vessel for which they are appointed, such as notices of de-registration or papers for the institution of, or otherwise in connection with, any criminal or civil proceedings.
❔ What is the difference between Commercial and Pleasure use?
A commercial yacht is engaged in commercial activity i.e. available for charter by third parties.
A pleasure yacht is used solely for recreational use on a private basis by its owner and their guests.
❔ Do yachts have to be registered?
In some countries, yacht registration is mandatory, while in others it may be optional and depends on the size of the yacht, where it will be used, and the intended use of the yacht.
For example, in some countries, only yachts used for commercial purposes are required to be registered, while yachts used for recreation may not need to be registered.
It’s important to check with local authorities to find out the specific registration requirements for the country where the yacht will be used and to ensure compliance with maritime laws and regulations.
❔ How do I register a yacht in Malta?
To register a yacht in Malta, you will need to follow these general steps:
- Obtain the necessary documents i.e. proof of ownership, a valid certificate of survey or a classification certificate, and proof of your identity.
- Apply along with the required documents.
- Pay the fees associated with the registration process i.e. registration fees, tonnage fees and annual fees.
- Register the yacht – once the application has been reviewed and approved, the yacht will be registered and a certificate of registration issued.
Malta registration is valid for 5 years and will need to be renewed before it expires.
Please note that the above steps are general and may be subject to change and specific requirements may vary depending on the type and size of the yacht and its intended use. We recommend checking with Transport Malta or a local service provider with experience in yacht ownership, registration and administration. For more information on Yachting in Malta and why the Malta flag is so popular, check out our infographic 17 Reasons to Flag your Vessel in Malta.
❔ How do I register a yacht in the Isle of Man?
As a Red Ensign Category 1 register, the Isle of Man Ship Registry can register vessels of all sizes. It accepts privately operated yachts of any size and yachts used for charter over 24 metres in length.
It has a comprehensive list of over 60 countries for companies or persons qualified for registered ownership. There is a legal requirement for a local representative to be appointed for all vessels over 24 metres registered in the Isle of Man. If the vessel is owned by an Isle of Man body corporate, that entity can be appointed to provide this service. For a foreign-owned vessel, they would need to appoint a local representative to meet this requirement – Sentient International is approved by the Isle of Man Ship Registry as a ‘Representative Person’ and can act for owners and operators in this regard.
The process to register a vessel in the Isle of Man is simple and efficient.
1. Apply in writing for registration with the proposed name of the yacht.
2. Obtain, complete and submit all of the necessary documents and evidence required according to the size and use of the yacht, i.e. declaration and evidence of ownership, declarations of use etc.
3. Where applicable, appoint a representative person.
4. Arrange and obtain the necessary call sign, MMSI Number and Radio licenses.
5. Pay the fees associated with the registration process i.e. registration fees, tonnage fees and annual fees.
6. Register the yacht – once the application has been reviewed and approved, the yacht will be registered and a certificate of registration issued.
Here are our 10 Reasons to Flag your Vessel in the Isle of Man. Get in touch to find out how we can assist you in registering your yacht in the Isle of Man.
❔ What is the YET scheme?
The Yachts Engaged in Trade (‘YET’) is available to Non-EU resident owners of private yachts over 24 metres that are under temporary admission and registered with the Marshall Islands or the Cayman Islands flag.
It allows the yacht to engage in commercial activities i.e. charter, for up to 84 days per calendar year in French and Monegasque waters without having to pay VAT on the hull. Read our Yachts Engaged in Trade Scheme information sheet for more information.
❔ Can I charter my yacht anywhere?
Whether or not you can charter your yacht anywhere depends on the laws and regulations of the specific country or jurisdiction in which you plan to charter.
In some countries, chartering a yacht is heavily regulated, while in others it may be more relaxed.
To charter your yacht, you will typically need to meet certain safety and insurance requirements, as well as comply with any local laws and regulations related to chartering, which may include the need for a charter license and registration for VAT in a particular jurisdiction.
It’s important to research and check the local laws and regulations in the specific country or jurisdiction where you plan to charter as they may differ from one to the other. It is also important to note that some countries may have restrictions on foreign-flagged vessels operating in their waters, so it’s important to check with the relevant authorities before chartering your yacht in a foreign country.
If your yacht is owned by an entity that is managed by a corporate service provider or you have a dedicated yacht manager, they should be able to guide you appropriately according to your requirements.
To find out more about Yachting and the Isle of Man, its role in the global superyacht industry and the opportunities the Island has to offer new and existing owners, contact us on iom@sentientinternational.com or telephone +44 1624 616544.
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