Cayman Islands Registry – Yacht Engaged in Trade (YET) dual use programme..

The Cayman Islands Shipping Registry (CISR) has announced with its

SHIPPING NOTICE 03/2017

the procedure that is to be followed by a pleasure yacht registered in the Cayman Islands in order to obtain Yacht Engaged in Trade (YET) certification. The certification enables yachts over 24m to charter up to 84 days per calendar year in European waters, currently limited to France and Monaco.

In the Shipping Notice, CISR explains that the programme is applicable to all Cayman Islands-registered pleasure yachts that seek to charter in EU waters. Yachts must also be fully compliant with the requirements of the Shipping Notice, the Large Yacht Code and all other applicable national and international requirements.

Yachts up to 12 pax meeting these requirements will be allowed to charter for up to 84 days per calendar year in European waters (currently limited to France and Monaco waters only).

Advantages for yachts registered under the YET scheme include that

  • owners can use their yacht privately without losing the option of chartering the yacht on an occasional basis to offset running costs,
  • contrary to a commercially-registered yacht, the owners do not need to sign a charter agreement when using their own yacht on a private basis,
  • owners do not need to pay VAT on their own use of the vessel
  • the YET-registration option eliminates the need to switch between pleasure and commercial registration every time the yacht is to change its mode of operation and use,
  • It eliminates the need to proceed to export/import formalities and the need to leave the EU and visit a third-country port each time the yacht is to switch between pleasure and commercial use,
  • VAT exemptions will still be available on works for non-VAT paid yachts (via the inward processing relief regime) and the 18-month Temporary Admission allowance period is paused each time the yacht is used as a yacht engaged in trade and placed under Temporary Admission for Commercial Activity (TACA YET).

On the downside to being registered under the YET scheme is that

  • the yacht may have to comply with more stringent standards, as the yacht must operate in full commercial compliance at all times, whether engaged in trade or not. However, for most professionally-run superyachts, this is unlikely to be an issue,
  • Yachts certified under YET are not entitled to apply for any VAT exemptions on fuel or supplies.

“The majority of our large pleasure yachts are voluntarily compliant with the standards for commercial vessels and so switching a voluntary commercial yacht code certification to YET certification may just be a paperwork exercise in most cases,” assures Noad. “Of course, those pleasure vessels that voluntarily comply with safety requirements for a commercial vessel, but not security requirements, will need to meet those security requirements to be eligible for YET status.”

ELIGIBILITY FOR A YACHT ENGAGED IN TRADE (YET) 

  • The yacht must be 24 metres or more in length.
  • The yacht must be in possession of a Cayman Islands Pleasure Certificate of British Registry (Pleasure COBR).
  • The yacht must successfully undergo an initial Compliance Verification survey in accordance with section 6 of this Shipping Notice.
  • The yacht must comply fully with the requirements of the relevant chapters of the Large Yacht Code as required in the attached Annex 1.
  • The yacht must be classed by a Classification Society recognised by the Administration.
  • The yacht must operate in full commercial compliance at all times, whether engaged in trade or not; including full commercial compliance with all applicable national requirements and International Conventions including:
  1. The Maritime Labour Convention (MLC 2006);
  2. The Large Yacht Code;
  3. The International Convention for the Prevention of Pollution from Ships (MARPOL);
  4. The International Safety Management (ISM) Code;
  5. The International Ship and Port Facility Security (ISPS) Code.
  • Yachts with a gross tonnage of less than 500, shall implement a Safety Management System as per the requirements of Annex 2 of the Large Yacht Code. There is no requirement for a yacht under 500 gross tonnage to engage the services of a shore based company or Designated Person Ashore.
  • The yacht must have a documented planned maintenance system for all identified critical equipment.
  • The yacht must hold a valid International Load Line Certificate issued in accordance with the Large Yacht Code for at least a short-range yacht.
  • The yacht must be issued a with a Cayman Islands Yacht Engaged in Trade Certificate of Compliance (YET COC) and temporary Certificate(s) of British Registry for a Yacht Engaged in Trade (temp COBR YET) covering the charter periods or periods of commercial promotion.

This move from Cayman is significant for the industry. When the RMI first enabled its fleet to register with the YET scheme, take up was slow due to caution surrounding the legalities of such a flexible registration option. Now the scheme has Cayman’s backing, confidence in the initiative will grow. It is also good news for the French yachting industry, especially considering France’s year of bad yachting press. And, who knows, if the initiative provides the country with substantial revenue in the coming years, perhaps the authorities of neighbouring countries might sit up and take note.

(source: Cayman Registry, SuperYachtNews.com)

Please contact us if you wish to receive the Shipping Notice and/or any clarifications

 

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