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Old 16-02-2014, 04:39   #1
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Non USA citizen want to buy a boat in USA, how register the boat?

Hello friends,

I'm a Brazilian citizen and want to buy a sailboat "used" in the United States. My country (Brazil) prohibits importation of used boats. Only allows the import of new boats, I do not want because of high taxes.
As my intention is not to return to Brazil with the boat but do crusing around world, how should I proceed?
Can I register the boat in USA?
If not where could register the boat?

I appreciate if someone can answer me.
Im sorry my bad language.

Thank you!

Luciano
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Old 16-02-2014, 04:46   #2
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Re: Non USA citizen want to buy a boat in USA, how register the boat?

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Old 16-02-2014, 10:50   #3
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Re: Non USA citizen want to buy a boat in USA, how register the boat?

The way to do this as a non US citizen is to create a corporation in the US (Delaware being the easiest choice, and one chosen by hundreds of boaters around the world, you just need to look at the number of "US" boats moored in the fancy marinas in the Mediterranean in the summer).

Once you create the corporation in Delaware, a process that takes minutes and is done on line via the websites of the dozens of Delaware registered agents - the corporation buys the US boat, and voila, you become the proud owner of a US company, incorporated in Delaware, which itself owns a boat, with a Delaware registration.

The fees involved are minimal, for eg, there's a yearly tax to be paid ($250) to the state of Delaware, and an annual fee to pay the registered agent who takes care of all the paperwork for you. One of the less expensive ones is at Yacht and Delaware Registry, Ltd - Delaware Incorporation Services - Delaware LLC and General Incorporation - 1 302 477 9800 Wilmington, DE USA | company formation corporation boat incorporate but you can also google for "delaware registered agents"

It is all perfectly legal, and certainly the easiest way to buy a boat that is already registered in the US. The annual fees are negligible compared to the VAT one would have to pay in any high tax country like Brazil or the EU, and is a sensible solution if your goal is to cruise around the world, and not stay in any one place for longer than whatever period might make the boat be considered a "tax resident" of that country. That, in turn, is one of the main drawbacks, ie, with a Delaware courtesy flag, you normally cannot stay in the same country for a prolonged period of time.

Delaware has gotten so competitive in the last few years, and easy to set up on line, it has really displaced the BVI or the Channel Islands (Jersey or Guernsey), which used to be favourite locations in which to register your boat and avoid VAT if you never intended to bring your boat into the EU.







Turns out that Delaware facilitate these courtesy flags
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Old 16-02-2014, 11:33   #4
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Re: Non USA citizen want to buy a boat in USA, how register the boat?

I wonder what the down side of having a Delaware boat ?
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Old 16-02-2014, 11:48   #5
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Re: Non USA citizen want to buy a boat in USA, how register the boat?

A reminder for a non-US citizen. There are two issues which are totally separate.

First, is registration, which in the US is done by state. This is what the person is discussing in the Delaware registration post.

Second, is documentation. This is the equivalent of registration in many countries. Many boats in the US don't require it but might if traveling abroad. This is the process of "Flagging" the boat.

Now as to documenting in the US, it is very difficult for a non-resident. You can do it through a corporation but you must have the key people and majority of board of directors US residents. So normally, if documentation is required, one would still do that elsewhere, if not a US resident.

The question often arises as to whether documented boats need to be registered also. That differs by every state as do all the registration requirements.
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Old 16-02-2014, 12:02   #6
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Re: Non USA citizen want to buy a boat in USA, how register the boat?

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Originally Posted by BandB View Post
A reminder for a non-US citizen. There are two issues which are totally separate.

First, is registration, which in the US is done by state. This is what the person is discussing in the Delaware registration post.

Second, is documentation. This is the equivalent of registration in many countries. Many boats in the US don't require it but might if traveling abroad. This is the process of "Flagging" the boat.

Now as to documenting in the US, it is very difficult for a non-resident. You can do it through a corporation but you must have the key people and majority of board of directors US residents. So normally, if documentation is required, one would still do that elsewhere, if not a US resident.

The question often arises as to whether documented boats need to be registered also. That differs by every state as do all the registration requirements.
I may be wrong but I thought that these companies offer that "flagging" service too as part of the "package" (probably an extra).

There is also insurance to consider, I believe (not sure) that it may be hard to insure a US flagged boat with a non US company.
I know when I check my insurance co re insuring a boat with a Delaware flag the conversation ground to a halt very quickly.
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Old 16-02-2014, 12:06   #7
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Re: Non USA citizen want to buy a boat in USA, how register the boat?

Quote:
Originally Posted by Captain Ludd View Post
I wonder what the down side of having a Delaware boat ?
Judging from the number of Delaware registered boats around the world, I would say, not much! -

One thing to keep in mind if you're considering forming a Delaware company : you generally have a choice between an LLC or a corporation. In the latter case, you can elect to have your name on the official incorporation documents, which may be helpful -for eg, when you decide to sell the boat, and a suspicious prospective buyer may want to make sure that you are the real person owning the corporation. In the case of an LLC, your name does not appear in the incorporation documents - which could be an advantage for some. of course, in both cases, you will have the official corporate seal, and the records to show who the beneficial owners of the company are.

IMHO, as long as you cruise around the world, and not settle for any length of time in the EU (Vat implications) or the US (residency/visa implications), a Delaware flag if a practical and inexpensive port of registry. At least for now!
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Old 16-02-2014, 12:17   #8
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Re: Non USA citizen want to buy a boat in USA, how register the boat?

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Originally Posted by Captain Ludd View Post
I may be wrong but I thought that these companies offer that "flagging" service too as part of the "package" (probably an extra).

There is also insurance to consider, I believe (not sure) that it may be hard to insure a US flagged boat with a non US company.
I know when I check my insurance co re insuring a boat with a Delaware flag the conversation ground to a halt very quickly.
There are many of those companies offering many different things. One of those is to use a US corporation owned by a Trust. They use "nominee" directors. What all of this involves if documenting in the US is appointing others such as a company like this to in effect be in control of your boat. Now they do have responsibilities to you. While going through such a procedure may be beneficial and worth it to some it may be a lot of effort and cost to accomplish little for others.
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Old 16-02-2014, 12:25   #9
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Re: Non USA citizen want to buy a boat in USA, how register the boat?

Quote:
Originally Posted by luciano Rod View Post
Hello friends,

I'm a Brazilian citizen and want to buy a sailboat "used" in the United States. My country (Brazil) prohibits importation of used boats. Only allows the import of new boats, I do not want because of high taxes.
As my intention is not to return to Brazil with the boat but do crusing around world, how should I proceed?
Can I register the boat in USA?
If not where could register the boat?

I appreciate if someone can answer me.
Im sorry my bad language.

Thank you!

Luciano
Any of the countries that offer flags of convenience would work. Cayman Islands, Bahamas, Marshall Islands are popular among yacht owners. There are 32 listed flags of convenience at this time.
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Old 16-02-2014, 12:29   #10
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Re: Non USA citizen want to buy a boat in USA, how register the boat?

I have no personal knowledge but have heard that Panama may be a possibility for flagging your boat. There are some countries that welcome a Panama flag quicker than a U.S. flag.
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Old 16-02-2014, 13:01   #11
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Re: Non USA citizen want to buy a boat in USA, how register the boat?

Quote:
Originally Posted by BandB View Post
There are many of those companies offering many different things. One of those is to use a US corporation owned by a Trust. They use "nominee" directors. What all of this involves if documenting in the US is appointing others such as a company like this to in effect be in control of your boat. Now they do have responsibilities to you. While going through such a procedure may be beneficial and worth it to some it may be a lot of effort and cost to accomplish little for others.
Thanks, that does sound like a bit too much effort I have to say
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Old 16-02-2014, 13:22   #12
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Re: Non USA citizen want to buy a boat in USA, how register the boat?

You can establish an LLC in Delaware via the Corporation Company for very little expense and as stated previously the annual cost is small - about $250 between the Registered Agent fee ($50) and the Delaware Corporation Tax ($200).
A Delaware LLC can have as few as a single member and that member does not need to be a US citizen. That is a single non-US citizen may establish and own outright the De LLC. The LLC may purchase and operate a US flagged vessel. That vessel may be a documented vessel, even though the LLC owner is not a US citizen because the vessel is actually owned by the US LLC entity. The process is very simple and inexpensive. There may no need to "register" the vessel at all if the LLC owner does not intend to keep the vessel in the US. On the other hand it may pay to "register" in a non or low sales tax state just to avoid future complications with state tax authorities. I believe that NC has a fixed low dollar boat sales tax, for example. There is also no requirement to file US taxes on the LLC provided it is not an operating business.
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Old 16-02-2014, 13:24   #13
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Re: Non USA citizen want to buy a boat in USA, how register the boat?

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You can establish an LLC in Delaware via the Corporation Company for very little expense and as stated previously the annual cost is small - about $250 between the Registered Agent fee ($50) and the Delaware Corporation Tax ($200).
A Delaware LLC can have as few as a single member and that member does not need to be a US citizen. That is a single non-US citizen may establish and own outright the De LLC. The LLC may purchase and operate a US flagged vessel. That vessel may be a documented vessel, even though the LLC owner is not a US citizen because the vessel is actually owned by the US LLC entity. The process is very simple and inexpensive.
Thanks Chris
Outright ownership would be important for the obvious reasons.
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Old 16-02-2014, 14:47   #14
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Re: Non USA citizen want to buy a boat in USA, how register the boat?

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Originally Posted by chrisjs View Post
. That vessel may be a documented vessel, even though the LLC owner is not a US citizen because the vessel is actually owned by the US LLC entity.
Not that easy. The LLC must be under management of US citizens. The LLC equivalent of a Chairman of the Board in a corporation must be a US citizen. In Delaware this is the Manager of the LLC. This is often a nominee manager in order to be able to document the vessel, meaning it may be a person or company paid to be the manager. Or trusts may be used similarly.

But the Coast Guard does look beyond and have requirements beyond just the fact it's a US LLC.

So possible and done often, but not as simple as stated.
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Old 16-02-2014, 14:50   #15
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Re: Non USA citizen want to buy a boat in USA, how register the boat?

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I have no personal knowledge but have heard that Panama may be a possibility for flagging your boat. There are some countries that welcome a Panama flag quicker than a U.S. flag.
Panama has traditionally had the most vessels flagged of any country but that's because of so many commercial vessels. Liberia is number two but it's based strictly on them registering vessels over 500 tons. Some of the other countries I mentioned are more popular for pleasure craft.
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