How to Place Your Own Yacht Rental for Charter
25th September 2019
How to place your yacht rental for charter
The pleasures of owning a yacht are virtually without parallel. The autonomy, the freedom, the sociability, the sport, the luxury, the interaction with the elements – it all feels like a very profound validation of your investment. And while owning, running and maintaining a yacht as the sole owner can be a labour-intensive and costly business, the sophistication of the modern yacht rental market means that you no longer have to shoulder those responsibilities alone. In fact, by offering your yacht for charter, it’s possible not just to ease the financial burden, but to safeguard the condition, value and effectiveness of your yacht, while retaining a great many of the pleasures that compelled you to buy it.
The benefits of charter
An effective charter company can take full charge of your yacht, managing it through the annual charter schedule in a way that yields substantial returns. Not only can that help mitigate the costs of ownership, but it can also help keep your yacht in first-class condition, your systems in prime working order and your crew fully up to speed in terms of training and operational effectiveness. By making your personal yacht a business asset, you may also benefit from tax relief and, if the charter company is able to manage the schedule in a way that is tailored to your preferences, there needn’t be any prohibitive restrictions in terms of your personal use.
When the time comes to sell, a history of charter also puts you in a great position to do that faster and more lucratively, courtesy of the fact that its condition ought to be excellent, its rate of depreciation is likely to have been minimised and its breadth of public exposure will have been radically increased. Charter guests often become yacht owners – and the fact that potential buyers will be able to witness how cost-efficient ownership of your yacht has been will also make a deal much easier to strike.
The basic logistics
To offer your yacht for charter or rental, it has to acquire commercial status and be operated as a business concern. While large yachts of beyond 30 metres often operate in accordance with commercial codes as a matter of course, the transition to commercial status for relatively small yachts can involve a great deal of paperwork.
It starts with flag registration and compliance with both the codes of the jurisdiction chosen for your yacht’s charter operations and any pertinent international codes. A classification society will also have to be appointed to oversee the yacht’s surveys and certification, and taxation is also a key issue. For chartering within the EU, the yacht owning company needs to be registered for VAT, with a fiscal agent in the country of charter to pay the appropriate sums to that nation’s government.
Crewing is another major issue. There are a great many requirements laid down by the Maritime Labour Convention for the proper treatment of professional seafarers in relation to issues like contracts, wages, sick pay and working conditions – and uprated protection and indemnity insurance will often be required to cover that. More to the point, even if you have trusted crew on board your yacht already, the transition to commercial status will often necessitate additional training and qualifications, alongside specific endorsements form the flag state.
It is clear then that chartering your yacht, at least at the outset, is a complex business requiring time, patience, contacts and expertise. It is important therefore to pick a charter company either with the internal expertise to handle these logistical necessities or with close ties to a yacht management company that can keep your yacht and crew fully maintained, documented and legally compliant.
Does yacht charter make sense for you?
Any well-maintained yacht in good order from around 18m upwards can be considered for luxury crewed yacht charter. While relatively neutral décor tends to make a charter platform more broadly attractive, an even spread of cabin sizes and a blend of private and open areas is also useful. On larger yachts, it’s important to ensure that your tenders and toys are up to scratch and properly tailored to the region in which you intend put her up for charter. But whether on internal supplies and decor or on external facilities, an experienced charter company should be able to advise on where and how your money should be invested for the greatest financial return.
Once your yacht is a commercial vessel and a going business concern, your own personal use becomes broadly similar to that of a charter guest. To avoid being fined for use of your boat, you need to have the appropriate charter contract in place, and you need to pay the standard market rate for your time on board, including any VAT charges. It’s also worth noting that, when you’re not on board, you will need to remove most of your personal belongings and accept the fact that, as much as you covet your boat, the charter process inevitably involves having strangers on board. However useful charter might be in mitigating the overheads of yacht ownership, that simple reality is not for everyone, so you should think carefully before committing to the time, cost and effort of readying your yacht for charter.
How to pick the right charter company
Once your yacht is being operated as a commercial enterprise, the penalties for failing to run it properly can be severe, so in order to ensure that the various logistical issues are covered, most charter operators have close relationships with yacht rental management agencies. Other charter operators take a different approach, offering an integrated in-house service, which in some cases encompasses everything from design, construction and finance all the way through to management, charter, marketing and brokerage. In any event, as the owner of a crewed charter yacht, it remains vital to engage a proven management service to ensure that your yacht is not just compliant with the various regulations, but offered for charter in optimum condition. Princess Yacht Charter has close affiliations with its sister companies, Princess Motor Yacht Sales and Argo Yachting, enabling it to cover the full spectrum of yacht ownership needs and to offer a fully integrated management solution of exactly this nature.
The value of MYBA membership
MYBA, the Mediterranean Yacht Brokers Association, is an internationally renowned organisation, designed to maintain ethical and technical standards in the superyacht industry by means of a written guide to professional conduct. It covers the construction, maintenance, management, charter and brokerage of large crewed yachts and, as the internationally recognised standard, its influence is considerable. Member companies are required to hold Professional Indemnity Insurance and to meet the strict requirements outlined in the statutes. If you are a yacht owner considering offering your yacht for charter, MYBA membership therefore represents a confidence-inspiring assurance that levels of safety, service and quality are first-rate. Princess Yacht Charter is proud to be an established MYBA member.