Italy Announces revised rules for the Export of Yachts for VAT Purposes

In a very welcome move the Italian Agenzia Dogane Monopoli (the Italian Customs Agency) have announced a revision to the procedures for the export of yachts from Italy for VAT purposes.

Under previous rules any vessel built on an ex. VAT export basis by an Italian yard would have ninety days to leave the European Union and physically make passage to a non EU port whereupon a customs clearance would be undertaken in that port to prove arrival.

The proof of arrival would then be relayed to the shipyard as evidence of the discharge of the owner's obligations to export the vessel from the EU.

Failure to report and adequately demonstrate the physical arrival of the vessel in a non EU port would subject the vessel to Italian VAT at 22%.

In practice many vessels would export from Italy to Tunisia and other North African ports. Recent geopolitical tensions in the Southern Mediterranean have seen many yacht owners reluctant to visit these ports and navigate in surrounding waters on safety and security grounds.

The Italian customs in response to such concerns have on the 12th May, 2016 issued official notice N. 14/D titled "Esportazione delle navi da diporto - Prova dell’uscita dal territorio doganale dell’Unione".

A copy of the notice can be downloaded from our website here:

Esportazione delle navi da diporto - Prova dell’uscita dal territorio doganale dell’Unione

The effect of the notice is to simplify export requirements so that vessels now only have to navigate into international waters to effect an export. International waters is defined as 12 nautical miles from the nearest EU landmass.

The vessel owner or captain must make a written declaration to Italian customs that the vessel has navigated into international waters and supply an AIS print showing vessel location in international waters as evidence of the vessel's position.

The ninety day time limit to export the vessel still applies and owners can still if they wish choose to physically visit a non EU port within this timeframe.

Although not specified in the notice we understand that the simplification of the export rules extends to vessels who would otherwise need to navigate out of Italy to a non European port in order to renew their 18 month Temporary Admission discharge period.

It remains to be seen whether the welcome simplification of the export rules by Italy will be replicated in other EU countries. Until this point is clarified by the EU yacht owners operating outside of Italy may still wish to consider making a passage to a non EU port.

Oceanskies are specialists in the registration and documentation of yachts built for export and/or operated within EU water without being VAT paid under Temporary Admission.

A full guide to Temporary Admission can be found here in our online guide:

Oceanskies - Guide to Temporary Admission

We would be pleased to assist any owner intending to take advantage of these mechanisms for their vessel by providing non EU vessel registration solutions under Part I of the British Register of Ships at all of the main offshore ports of registry including the Cayman Islands, Jersey, Guernsey and the BVI.

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