Sailing a privately chartered boat into France

[Nor-sail]

Hello everybody, very happy to join a forum with such a vast group of members with the same interests.

I`ll cut to the chase. We are renting a boat privately from a Norwegian sailor, affordable and practical as I`m Norwegian too. We are planning a three week sail this summer, and the yacht is located in Sardinia Italy. Since we have three weeks at hand and two great Islands well within reach, we would love to explore both the Sardinian and the French island Corsicas coastline.

The boat owner warned us however, that the French are not too easy too deal with when it comes to private charter, although this really should not be an issue since both France and Norway are part of the common economic zone of the EU. This puts some unwanted restrictions to our plans. Our boat owner says there is not really any laws against privately chartering a boat within the EU zone, but the french are a bit too eager, and one risks getting forced to local incredibly expensive marinas if they decide that they need time to investigate the legality of privat charter. Ending up in such a situation, would for sure not be a great vacation experience, neither being forcefully stuck in a marina, nor being forced to pay 200 Euros per day, which is not an uncommon rate in Bonifacio and the surrounding areas I have heard. We are planning to anchor as much as possible, as the marina prices both on Corsica and Sardinia ar infamously expensive.

Does anyone have experience with this kind of practice, or knows French/EU laws on the subject? It sounds like a risk to take anyway, if the practice is strict regardless of what is actually right or wrong. Maybe if we do our research up front, and can refer to the correct laws, there is a better chance to stay out of trouble should we run into the coastguard. Maybe try to get something written from the French port authorities up front?

It would be great if someone has info on this subject.

Best Regards
Frode

[boatman61]

Maybe instead of carrying a charter agreement you just present a letter of consent from the owner for you to 'borrow' his boat for the holidays.
As far as I know there is no rule/law prohibiting a 'friend' from letting a another friend use his boat.
What happens in Norway stays in Norway..

I deliver boats and all I produce are the boats documents and a letter from the owner authorising me to operate the vessel.
To much info can be a bad thing.

[Nor-sail]

I have thought about it as a last resort or a "work around", although a more honest approach would be favorable

There is a risk though, that the coast guard suspects and starts asking natural questions about our proforma friendship. In that case one would need to be a half descent actor/lier, but I`m not quite sure I or the rest of the crew is ��

[TrentePieds]

Frode:

Sounds very odd to me, and if I were in your shoes I'd ask the owner just what he means, and what he is referring to. I cannot believe that Norway would have any objection to a straight-forward contract between two Norwegians, nor can I believe that a Norwegian vessel skippered by a Norwegian, though owned by another Norwegian, should not be able to go wherever she likes, just as long as all documentation is in order.

Is there some EU regulation that the owner is not complying with or seeks to contravene? Is there some particular licensing regulation that you as skipper, and therefore responsible for the crew, must comply with? Is the owner, or the vessel herself, already "in dutch" with the French for some reason?

Se dig nu for :-)!

TrentePieds, FDP

[Montanan]

References:

Upcoming changes on VAT treatment of French yacht charters in 2021

https://marosavat.com/vat-on-french-...on-EU%20waters.

A declared upcoming changes to VAT treatment on chartering activity for contracts signed after 1 November 2020. Previously, France allowed a lump-sum reduction policy of 50% on the taxable base as long as the boat spent part of the charter in non-EU waters. With accordance to the new law, this reduction will no longer apply.

Instead, businesses involved in chartering will charge the standard of 20% while the vessel is located in EU waters. When the yacht moves into non-EU territory, no VAT will be applied and evidence will be needed to prove the services carried out in non-EU waters.

Taxpayers are required to keep adequate evidence of the distance covered outside EU waters. This evidence may be challenged by the tax authorities in the course of a tax inspection. However, where the boat has sufficient means according to the SOLAS convention, such means would not be challenged by the French authorities.

Similar changes can be seen in Italy, with the on the VAT treatment to be applied on chartering activity. It is expected that the tax authorities in Malta and Cyprus will soon follow suit in order to make the tax laws within Europe more uniform.



VAT Changes for Yacht Charters in the Mediterranean 2021

BY EDITORIAL TEAM 9 FEBRUARY 2021

https://www.yachtcharterfleet.com/ne...terranean-2021

Changes in VAT regulations for yacht charters that start in France, Monaco or Italy have now come into effect in 2021.

If you are seeking to charter a yacht across the glittering Mediterranean this year, be aware of possible VAT changes that have come into effect in 2021 and may now apply to your trip.

The ever-evolving VAT regulations on superyacht charters in EU waters and beyond means keeping yourself up to date with developments now is key to preventing unexpected costs later. Below is our round-up of the most recent VAT protocol to keep in mind when chartering a yacht in 2021.
Whilst implementing new VAT regulations in France, Monaco and Italy were initially delayed due to the pandemic, 2021 sees this change. Now, all charters whose port of embarkation starts in these stated destinations will have VAT applied at their respective countries’ full VAT rate (and this will also pertain to any delivery or redelivery fees). The full VAT rate is applied irrespective of where the port of disembarkation is.

This means that for yacht charters that start on the tranquil shores of France or Monaco, you can expect a standard rate of 20% VAT (as well as any delivery or redelivery fees incurred).

Meanwhile, if you intend to start your charter in Italy, a standard rate of 22% plus any delivery or redelivery fees will now apply, following changes to VAT laws for Italy charters from June 2020.

For any itineraries that involve journeying to France, Monaco and Italy, the same rules apply: VAT is charged at the rate of the origin of the charter.




Also there is the issue of liability of the Charter Parties involved in the chart relationship, and the insurance coverage of both the vessel owner and the master of the vessel that is named as the charter person taking charge of the vessel during the voyage. That is a complex subject, very much contractual in nature between the parties and between the underwriter of the insurance.

This is NOT a casual transfer of the vessel's use under maritime law.

[Montanan]

From my filed notes.

What Is a Boat Charter?
Boat chartering refers to the practice of hiring or renting a boat for personal use. It is basically a like a rental or lease allowing a person to use a boat for a specified period of time. They can be obtained for recreational purposes such as a personal cruise or for business reasons like shipping goods.

Chartering a boat is usually done for a fee.

What Are Some Common Types of Boat Charter Arrangements?

There are many different types of boat charter arrangements. Each carries different legal responsibilities due to differences in crew management and the types of boats involved. Some common types of boat charter arrangements include:

Bareboat charter: Hiring a boat without a crew or captain. In this case possession of the boat is transferred to the patron, who may then hire their own crew. The transfer of possession is the main characteristic of this type of charter. Also called a “demise charter”

Time charter or voyage charter: The boat or yacht is leased along with a captain and crew provided by the owner of the vessel. In this way the boat owner effectively retains possession of the boat through the captain and crew

Skippered charter: Along with the boat or sea vessel, a professional captain (the “skipper”) is hired to maneuver the craft. Sometimes the skipper will be assisted by various other crew members as well. This type of charter is common for yachts and larger boats that require special skill and experience.

Who Is Liable for Injuries or Damages in a Boat Charter Agreement?

Liability for damages incurred during a chartered voyage depends on the type of charter. There can often be several different parties involved in the endeavor, including the broker, the boat owner, the captain and crew, and the party using the boat.

Legal responsibility will vary depending on the situation, but in general the following parties may have some amount of liability:

Owner of the vessel: The vessel owner is usually required to keep the ship or boat in safe working condition. They should inspect the boat for hazards and take steps to minimize accidents while on board.

The captain and crew: Such persons have a legal responsibility to operate the boat according to maritime laws and standards. They should be able to furnish proof of certification or licensing.

The charterer (the party hiring the boat, the patron / master): The party hiring the boat or crew has a responsibility to avoid contributing to their own injury. This includes obeying ship rules and preventing illegal uses of the boat. While there may be many of you voyaging together, there almost always is a Master defined as the person who is the legal charterer, and they are responsible. Who will be your designated charterer?
Point a finger at that someONE.

The charter broker company: Usually legal liability for such companies is limited to such issues as contracts and fee arrangements. They are rarely held liable for injuries as they are typically removed from the chain of causation.

Depending on the circumstances, liability may spread amongst the several different parties listed above. For example, if the vessel owner is also responsible for hiring a crew, they may be liable if they hire an unlicensed person to act as captain. Likewise, the captain of the crew might be held liable to the vessel owner if they damage the ship.

Liability in a chartering arrangement can be complex as there are many levels of interaction between the parties. Principles of vicarious liability may be used to determine which parties are liable to another for damages or injuries. Also, international maritime laws may apply if the voyage is to another country.

[Nor-sail]

Originally Posted by TrentePieds

Frode:

Sounds very odd to me, and if I were in your shoes I'd ask the owner just what he means, and what he is referring to. I cannot believe that Norway would have any objection to a straight-forward contract between two Norwegians, nor can I believe that a Norwegian vessel skippered by a Norwegian, though owned by another Norwegian, should not be able to go wherever she likes, just as long as all documentation is in order.

Is there some EU regulation that the owner is not complying with or seeks to contravene? Is there some particular licensing regulation that you as skipper, and therefore responsible for the crew, must comply with? Is the owner, or the vessel herself, already "in dutch" with the French for some reason?

Se dig nu for :-)!

TrentePieds, FDP

I don`t think that Norwegian authorities is the issue, since the owner of the boat is paying 25% Norwegian VAT from my understanding. But as Montana points out here, it looks as though VAT should be paid to the country of embarkation, not the origin country of the vessels owner. I`m guessing that the owner has not thought of this, and is just sending an invoice from his Norwegian based company. I`m also guessing that if I do make him aware that he has to check with Italian government to make sure he is paying tax to the correct country, he will probably not think it is worth the hassle, and either just pretend he did not hear it, or cancel the contract. The question here, am I at any risk for chartering his boat? I`m guessing it is his/his company's responsibility to make sure he is following the tax rules of the country he is operating in, not his clients?

Well ill be darned, Now i feel like it kind of would have been better not to ask the question in the first place

[Montanan]

https://improvesailing.com/destinati...irements-italy

Italian laws:


It is against Italian law to swim in any Italian harbour. Swimmers are subject to hefty fines.
It is against Italian law to motorsail within 300m of the shore, except when entering or leaving a harbour.
Anchoring is prohibited anywhere around the coast within 200m of a beach or within 100m elsewhere.

This rule can often be seen to be flouted, particularly during the high season, but it is a law which is increasingly being enforced, and can attract a fine of €350.


France:

Documents. Passport. Yacht registration papers. VAT receipt or other proof of payment. You may be asked for: proof of insurance for the yacht, proof of competence to handle a yacht such as the RYA ICC.

[TrentePieds]

Frode,

Well YOU might not have needed to ask the question, now that you've thot about it, but consider that you might have done a favour for someone less forthright about asking than you :-)!

As Montanan rightly point out, the relevant regulations are complex. and the danger to you is that even though YOU (and your crew) might be perfectly innocent of ANY dodgy dealings, the yacht, even while in charter, would still be the property of the owner, and therefore could be subject in some circumstances to seizure if the owner has transgressed.

And it's a long walk twixt Marseilles and Oslo :-).

My interpretation of the owner's warning to you is that he knows that he doesn't have "rent mel i posen"

In this 'ere colony the equivalent of EU VAT is GST (Goods and SERVICES Tax). It is payable on EVERY commercial transaction (with very few clearly stated exceptions) once the "seller" conducts business in excess of Can$30K per annum. And that ain't much! It is the seller's responsibility to collect it from the buyer and to remit to the Receiver General of Canada. If the seller fails to do so, the consequences will be on him, not on the buyer. If, therefore, Canada Revenue Agency seizes a yacht to recover GST not remitted while that yacht is in charter, the charterer might find himself not only out of pocket for the charter fees, but also in need of alternative transportation.

I would expect that French regulations would be very similar. I shouldn't be surprised if your "friend" knows that he is sailing too close to the wind.

Cheers,

TrentePieds

[goboatingnow]

Firstly. Unless the seller exceeds the annual vat threshold , and is not registered for vat. Then this transaction is between two unregistered people AND Vat does not arise in Norway or elsewhere within the EU.

The eu unlike the us does not have rules about private charters but some countries have specific restrictions , but these usually apply to the point of embarkation.

Hence in theory you can fall foul where you embark from such a country like Italy.

The best thing to do is to not present the arrangement as a commercial charter. ( it’s unlikely to be viewed as one anyway )

Simply carry a letter saying you have the permission of the owner to use the vessel. You will need to carry insurance and ownership papers for the boat.

Don’t advance any suggestion it’s a commercial relationship

As I said this has nothing to do with vat. It’s about charter laws in specific countries.

So so example you are not embarking in France so you’ve nothing to worry about there.

In the EU VAT is not charged on every commercial transaction. The threshold for example in Ireland is 37,500 for services and 75,000 euros for goods. If you sell under this amount annually you are not obliged to be vat registered and hence account for vat.

Loads of micro business hence are not in the vat loop at all.

[goboatingnow]

The long boilerplate piece quoted up thread has no bearing on the OPs position that refers to a concession vat rate France applied to charter companies that had a significant proportion of their business outside the Eu , ie super yachts , people need to stop cutting and pasting this sort of unrelated boilerplate

[goboatingnow]

Originally Posted by Nor-sail

I have thought about it as a last resort or a "work around", although a more honest approach would be favorable

There is a risk though, that the coast guard suspects and starts asking natural questions about our proforma friendship. In that case one would need to be a half descent actor/lier, but I`m not quite sure I or the rest of the crew is ��

The French will not in the main bother you.

There is no issue in France if you do not embark there. The issue is Italy. Private non registered yacht charter is not allowed in Italy but it widely occurs “ under the radar”

The main problem is not the authorities it’s other “ legitimate “ charter operations complaining about an illegal charter operation

If your Norwegian friend is doing this very very occasionally , that’s one thing. If this is a regular business you could have issues

The French are actually more laid back then the Spanish and the Portuguese in my experience.

[Emouchet]

I did chartered a boat in summer 2020 from south of france and sailed to corsica.

Did not had a problem at all. Marina handled as if I was the boat owner when I was requesting a slip.

Remember there are plenty of european and foreign boat sailing france and european water.

All what marina want is you business. I would be more worried with slip reservation. French can be a bit picky if you are arriving we no reservation and are requesting a slip.

Same with anchoring. Stay polite, pay what ever anchoring fees (yes they exists) is required and you will be fine. Anchroage can be fairly crowded. A good help tool is the Navily App.

3 hints:
-Remember also most french have a long 2 hours break at noon, so do not expect they will take care of you during those hours.
-Begin your request with "Excusez moi, J'ai un problème"... Excuse me, I have a problem. French love helping people that have problems and politely ask for help
-Speaking a bit of french, and trying to speak french will open a lot of doors...

[yeloya]

Originally Posted by goboatingnow

The French will not in the main bother you.

There is no issue in France if you do not embark there. The issue is Italy. Private non registered yacht charter is not allowed in Italy but it widely occurs “ under the radar”

The main problem is not the authorities it’s other “ legitimate “ charter operations complaining about an illegal charter operation

If your Norwegian friend is doing this very very occasionally , that’s one thing. If this is a regular business you could have issues

The French are actually more laid back then the Spanish and the Portuguese in my experience.

This is exactly my experience.. You can probably get away in France but Italy is a real problem, I was boarded by "Guardia di finanza" in Sardegna. If you don't speak Italian , you are even in deeper problem..

Cheers

Yeloya

[goboatingnow]

Originally Posted by Emouchet

I did chartered a boat in summer 2020 from south of france and sailed to corsica.

Did not had a problem at all. Marina handled as if I was the boat owner when I was requesting a slip.

Remember there are plenty of european and foreign boat sailing france and european water.

All what marina want is you business. I would be more worried with slip reservation. French can be a bit picky if you are arriving we no reservation and are requesting a slip.

Same with anchoring. Stay polite, pay what ever anchoring fees (yes they exists) is required and you will be fine. Anchroage can be fairly crowded. A good help tool is the Navily App.

3 hints:
-Remember also most french have a long 2 hours break at noon, so do not expect they will take care of you during those hours.
-Begin your request with "Excusez moi, J'ai un problème"... Excuse me, I have a problem. French love helping people that have problems and politely ask for help
-Speaking a bit of french, and trying to speak french will open a lot of doors...

This is not the OPs issue. The OPs issue will only occur where he embarks or disembarks , ie the start and end of the charter ( usually the same place ). No problems will be experienced in intermediate countries that you simply visit. Hence since the boat is in Italy , the only issue is there.