Regulations within the Med have long dictated that megayachts fit into one of two categories. Either the yacht is strictly private, with no commercial (a.k.a. charter) usage, or she’s available for charter. That’s changing under the Marshall Islands registry. The third largest registry in the world has a new program called YET, for Yachts Engaged in Trade. YET blends the benefits of private and charter use. In sum, it lets private yachts engage in limited charter, without having to register as a full commercial yacht.
A few years in the making, the YET program was unveiled publicly at the Monaco Yacht Show. The setting was fitting, as the Marshall Islands registry developed YET with the French customs and port-state authorities. So far, it’s applicable only in French and Monegasque waters. But, because it’s based on European Union regulations, plans are underway to expand it throughout Europe.
The benefit of YET is that owners who wish to offer their yachts for charter to third parties for short periods—say, events like the Monaco Grand Prix and an additional few weeks throughout the year—can now do so without switching regimes. Specifically, YET permits charter for up to 84 days per calendar year. It also takes into account VAT regulations.
To qualify for YET, a Marshall Islands registered yacht must meet a handful of requirements. For example, she can be a European-owned or non-European-owned yacht that’s VAT paid. She can alternately be a non-European-owned vessel with Temporary Admission, meaning the yacht has temporary import status for solely private use while in European waters.
Once cleared for YET, you gain a few extra advantages. The yacht doesn’t need to head outside of European waters and clear customs in another country to officially change the use status of the yacht. (See the above-referenced “switching regimes” statement.) There’s no need to pay VAT on your own usage. And, non-VAT-paid yachts are exempt from VAT on certain works.
To learn the full list of prerequisites and advantages, contact the Marshall Islands registry, and consult your maritime attorney.
There are two important caveats to YET. You cannot use your yacht while she is under commercial use. And, fuel and other supplies aren’t VAT exempt.
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