Corporate Yacht Ownership and Yacht Registration
Irrespective of the pleasures that go hand in hand with yacht ownership, there are many disadvantages of purchasing, registering and operating a yacht directly in ones own name.
It may therefore, be advantageous to set up a corporate vehicle in which to hold the vessel. As well as providing a higher level of privacy this helps dissociate the link of ownership between an individual and their yacht. Ownership through a corporate structure will also limit their liability to the value of the asset. By separating the activities and operations of the vessel from an individual’s personal wealth, it offers significantly more protection from any contingencies and/or potential risks that may arise from such activities.
It is a fundamental requirement that all vessels sailing internationally are registered in a recognised jurisdiction.
The jurisdiction a vessel is registered in is known as its 'flag state'. This can be the country to which an individual is domiciled, but more often than not, it will be an offshore jurisdiction, whose laws are more conditioned towards the complexities of both pleasure yachts and commercial operations.
Of all flag states around the world, the British flag is the most highly regarded and has a reputation for maintaining the highest standards in maritime law. British registered yachts, can if required, benefit from the assistance of any British Embassy or Consulate around the world. Registration with the British Registry is reliable, offers security and peace of mind. As well as the United Kingdom there are many offshore jurisdictions that are British dependent territories, these include Guernsey, Jersey, Isle of Man, British Virgin Islands, Cayman Islands, Gibraltar and Bermuda. Each territory has its own set of regulations and the most appropriate for registration will be decided on by a number of factors, these will include but are not limited to, the yachts VAT status, cruising area, where the owner is domiciled and whether the yacht is to be used for pleasure or charter.
As only British nationals and citizens of the EU can own a British registered vessel, those resident outside these jurisdictions can make use of a company registered in a British domicile to own their yachts. The vessels can then be registered in the name of the company, with the client holding the shares either in their own name or by nominee.
By Nathalie Langmead
