Operating a Business in International Waters

[Brian T]

So it would seem that much of the barrier that lies between many people's ingenuity and success comes in the form of government... (I have read every page of "making $ while cruising" and the like threads)

What do you guys think, and don't laugh now because I'm being partially serious here, (you can chuckle, but don't outright laugh ) what about a floating service station in international waters?

I am posting this before I have done much research on the subject, but the idea of setting up an operation that could operate in international waters is very curious to me! What all is involved in regulating activity in international waters? I'm thinking about how cruise ships can gamble and sell stuff tax free as soon as they have crossed into the magical territory that nobody seems capable of claiming and protecting...

Basically the idea so far would be to have some kind of floating barge with dock space that applicants could occupy and sell/trade their services in a free market environment...

Anyone have any ideas on this? Reasons why it would be tough or wouldn't work are just as welcome...

P.S. Early applicants are now being accepted and will be given preferential dock space when we open

[DennisM]

My first thought is that, just as no government would be capable of regulating the operation, neither would they be willing to protect it. How's your supply of heavy weapons?

[boatsail]

Originally Posted by DennisM

My first thought is that, just as no government would be capable of regulating the operation, neither would they be willing to protect it. How's your supply of heavy weapons?

That is a job to be hired out, just like private security in insecure areas if you have something valuabl and want it protected.

The thread is interesting and I have thought about this and wondered about the answers before. Can't wait to see what others post

[DennisM]

Originally Posted by boatsail

That is a job to be hired out, just like private security in insecure areas if you have something valuabl and want it protected.

That is certainly a solution, Boatsail. But I wonder how much you'd have to increase the price of a gallon of diesel to cover the cost of a private naval force.

[skipmac]

Interesting idea but off the top of my head I cannot think of many "services" that are not already legal in some part of the world, if not de facto then de jure.

For business services, there are plenty of countries that are tax havens where you can operate or at least on paper base your company to operate cheaply. Also plenty of places that offer duty free sales.

For vices there are plenty of countries one can visit to indulge in any intoxicant imaginable and the sex trade is booming in lots of places.

I don't know the current status but there used to be countries that, for a fee, would issue a passport to most any applicant.

Don't see any opportunity for pirate radio these days.

Gambling is already covered in so many ways.

To offer business services or indulgence in vices beyond that which is already available I think would venture into the realm of, shall we say, unsavory.

Maybe I'm just not thinking outside the box. What else is there?

[denverd0n]

International water is 12 miles offshore in most places. At least 3 miles offshore everywhere that I know of. You can't just take your average work barge out there, drop an anchor, and have it work very well. The only thing equivalent in use today would be oil rigs, and those are hundreds of millions of dollars each.

I'm thinking that, between the cost of the rig itself, the on-going costs to bring your inventory out, and the cost to provide security, you're not going to be able to compete with land-based operations.

[belizesailor]

Whose your market for this business? In most cases to be in "international" waters you need to be a minimum of 12 miles from land...whose going to motor 12 miles to buy expensive fuel from you?

[DennisM]

Originally Posted by skipmac

To offer business services of indulgence in vices beyond that which is already available I think would venture into the realm of, shall we say, unsavory.

Well said. But to paraphrase H. L. Mencken, nobody ever went broke overestimating the unsavoriness of cruising sailors.

[Brian T]

Originally Posted by DennisM

My first thought is that, just as no government would be capable of regulating the operation, neither would they be willing to protect it. How's your supply of heavy weapons?

Yeah I had thought about that... and I guess this is why governments get away with as much crap as they do, becasue in the end they can clamp down and sort out issues that could get out of control.

This would definitely be a wild west type of operation, and there would always be some more risk involved, but that is why you are potentially getting such a reward There would have to be some form of management that decides on what kind of defences/security would be required. (probably contract that out , I have some friends, as my background is in Emergency Management)

But in the end it's not really going to be anything that theives/villans would really find worth targeting... I mean it's really just a large gathering of people on their boats that are ready to work. (sure many have will have shops and equipment for their use, but very heavily used, very scattered inventory, and not much that would add up to large after market value... at least not anything that would be on the radar screen of say, pirates who are targeting tankers whos owners air drop pallets of millions in cash onto their decks for the return... I'm guessing they'd learn pretty quickly that no air drop payments will be made to return a livaboard cruiser to the international trading station) But yes, some form of defensive system will definitley be needed!

In the end it may be much less of a desirable target than areas with soft govt enforcement, becasue we can have as strong of enforcement as we like, and not have to adhere to any portocol or system

[s/v Jedi]

Originally Posted by belizesailor

Whose your market for this business? In most cases to be in "international" waters you need to be a minimum of 12 miles from land...whose going to motor 12 miles to buy expensive fuel from you?

On the Atlantic ridge, the route between the Cape Verde's and Barbados? Much like a space station in the likes of Deep Space 9 or Babylon 5

It would be a hit: cruise liners would visit.

[Pblais]

It's not totally dumb but mostly. There is a proposal to have a cruise ship anchored off San Francisco (13 miles) as a residence for high tech workers that can't get a US VISA. This would be a nice place shops and amenities for people get paid quite well. Huge investment but some people think it's feasible. In that sense the idea is possible BUT... .

The problem with your plan is far off shore means a floating barge is gone in the first storm. It needs to be bigger. As a dock in unprotected waters you might tie up for lunch but not much more.

Anyone needing to exchange "services" isn't going to want other people watching. Those that might want to watch might be concerned that illegal trading of special products were going on. That means law enforcement and criminal elements both will consider you competition which in turn adds risk and reduces the demand for your barge. Being in international waters means you'll need your own security because no one will come to help. Who wants to stay with criminals and pay top dollar? Things that needs to be done out of sight from government are best not advertised and boat slips would be an annoyance not a revenue source.

Now lets go beyond all the above and get to the construction of such a place. This is going to cost a LOT of money much like building an off shore oil platform. Renting boat slips isn't a high margin business unless the location has a strong demand. Strong demand in the middle of absolutely nowhere begs the question of how much would anyone pay? If I had enough money to do this I would invest in something else that won't wash away in the first storm. You wouldn't need to make a living if you could afford this idea.

Right now there are enough island countries that allow a lot of things and don't care about simple cruisers exchanging services. Staying off the radar is generally good enough at least until it's not. The biggest danger is locals feeling you are being competitive. A phone call is all it takes to have you gone. Advertisement would actually be the dumbest idea possible.

[goboatingnow]

There has been several organisations using offshore barges as refuelling stations outside customs areas. Since the tax on fuel approaches 60% in Europe , several have been placed offshore there.

Not sure if any survived.

Dave

[Brian T]

Originally Posted by skipmac

Interesting idea but off the top of my head I cannot think of many "services" that are not already legal in some part of the world, if not de facto then de jure.

For business services, there are plenty of countries that are tax havens where you can operate or at least on paper base your company to operate cheaply. Also plenty of places that offer duty free sales.

For vices there are plenty of countries one can visit to indulge in any intoxicant imaginable and the sex trade is booming in lots of places.

I don't know the current status but there used to be countries that, for a fee, would issue a passport to most any applicant.

Don't see any opportunity for pirate radio these days.

Gambling is already covered in so many ways.

To offer business services or indulgence in vices beyond that which is already available I think would venture into the realm of, shall we say, unsavory.

Maybe I'm just not thinking outside the box. What else is there?

I guess my main market for this idea was cruisers and liveaboards... After reading every page of the "Make $ while cruising" thread, the common theme was that the ideas that most people had of how to make $ while cruising wouldn't work becasue they would need work permits, insurance, taxes, ect for every country that they wanted to make a dollar in, and in the end it was not worth it to perform the service if all of that had to be taklen into account... That is where this market is based.

[Brian T]

Originally Posted by belizesailor

Whose your market for this business? In most cases to be in "international" waters you need to be a minimum of 12 miles from land...whose going to motor 12 miles to buy expensive fuel from you?

...Not nessicarily fuel (although that could be one of the vendors), it would be more of a service based station, with a variety of services offered for sale or barter...

[boatman61]

Originally Posted by Pblais

Right now there are enough island countries that allow a lot of things and don't care about simple cruisers exchanging services. Staying off the radar is generally good enough at least until it's not. The biggest danger is locals feeling you are being competitive. A phone call is all it takes to have you gone. Advertisement would actually be the dumbest idea possible.

+A1... no one likes rice stolen from their bowl... picking up a few grains spilled on the table is another matter..