The Republic of the Marshall Islands Registry (RMI) has announced the launch of a new category of yacht registration known as ‘Yacht Engaged In Trade’ (YET).
The full designation for a yacht operating under this new registration is a ‘Private yacht with intent to request a Temporary Certificate of Registry for Yacht Engaged in Trade’.
The YET registration addresses a need within the luxury yacht market for a dual purposes private and commercial charter yacht registration.
The Marshall Islands Registry
The Marshall Islands, officially the Republic of the Marshall Islands, is an island country located in the northern Pacific Ocean. Geographically, the country is part of the larger island group of Micronesia with the population of around 68,000 people spread out over 34 low-lying coral atolls comprising 1,156 individual islands and islets.
Politically, the Marshall Islands is a presidential republic in free association with the United States, with the US providing defence, funding grants, and access to social services.
Seagoing vessels of any tonnage engaged in foreign trade including commercial yachts and private yachts 12 meters or more in length are eligible for registration in the Marshall Islands.
Yacht owners can choose between the ports of registry of either Bikini or Jaluit.
Traditionally when yachts have been operated privately they have had to maintain a privately categorised registration whilst commercial charter yachts have had to maintain a fully commercial registration.
Whilst it is possible for private yacht to convert to commercial categorisation and vice-versa a change of categorisation at the vessel’s respective ship registry is necessary.
Under Port State Control rules it has also been difficult for a yacht holding a private category registration to charter and vice-versa.
The beneficial owners of yachts operating under a charter regime in EU waters also have had to charter their vessel under commercial terms meaning they had to effectively charter their own vessels and pay VAT on their own charters.
The Yacht Engaged in Trade
Yachts holding the Yacht Engaged in Trade categorisation will be able to charter for up to 84 days per calendar year, provided it complies with all relevant regulations and requirements that apply to RMI commercial yachts as outlined in the RMI Yacht Code. Applicable yachts.
The Yacht Engaged in Trade categorisation will be available only for yachts over 24 metres in length.
The Yacht Engaged in Trade categorisation has so far been cleared with the authorities of France and Monaco and the Marshall Islands registry are hoping to extend this clearance to other EU countries.
The Yacht Engaged in Trade categorisation when used in accepting European states will require the vessel to be VAT paid.
The yacht owning company will have to hold the relevant fiscal registrations that apply in the country where they will operate for charter.
In France and Monaco for example the owning company will have to hold fiscal registration in order to properly account for VAT and any other tax obligations resulting from the vessel’s charter activity.
EU Temporary Admission
We understand that the Marshall Island authorities have been able to obtain the approval of the French and Monaco authorities for yachts that are not VAT paid and entered into the EU under Temporary Admission relief from VAT to also benefit from the Yacht Engaged in Trade categorisation.
One of the key conditions of Temporary Admission relief from VAT is that it is available only to yacht in private use. Temporary Admission relief would therefore have to be suspended for the duration of any charter in order not to breach to these conditions.
RMI Marshall Islands Yacht Registration By Oceanskies
Oceanskies is based in the Channel Islands and provides a Marshall Islands yacht registration service to all yacht owners wishing to take advantage of the RMI registration for their yacht.
The registration service results in Oceanskies taking responsibility for the entire registration process on behalf of the owner including:
• Seeking vessel name approval
• Liaison with builder and/or seller to obtain legal title in the vessel
• Drafting and obtaining necessary documentation from owner
• Arranging and performing the tonnage survey and class / RMI surveys
• Assistance with registration of owner as a Foreign Maritime Entity
• Assistance with selection and appointment of fiscal agents in France and Monaco
• Obtaining provisional registration
• Assistance with Carving & Marking formalities
• Radio licence application & EPIRB registration
• Provision of Certificate of Registry
• Provision of vessel radio licence allocating call sign and MMSI number
For further information please do not hesitate to contact us.