Rosemont on Cayman’s new YET programme

alexbaldwin
By alexbaldwin January 17, 2018 13:03

Rosemont on Cayman’s new YET programme

Last week, the Cayman Islands announced that it has started offering Yacht Engaged in Trade (YET) registration for yachts.

Cayman is the second major yacht registry to start offering the YET registration, with the Marshall Islands launching a programme back in 2015.

From an owner’s perspective, the YET programme seems like a no-brainer if you are looking to earn back some money on your yacht.

When you register your yacht under YET, you can privately list it. This means that you do not need to pay tax on it and you can charter it out for 84 days to 12 different guests at a time.

We talked to Janet Xanthopoulos, senior manager – head of the yacht division at Rosemont, who worked with Cayman to implement the programme, about the YET registration, working with Cayman, and what YET offers over private and commercial yacht registration.

Who approached who about the collaboration?

Cayman approached Rosemont in January last year to discuss the possibility of extending the YET programme to yachts registered with the Cayman Islands. This has followed on from when Rosemont assisted the Marshall Islands back in 2015 to successfully launch their Yacht Engaged in Trade programme.

Both Marshall and Cayman identified the demand from yacht owners to have more flexibility in the way they operate their yachts in the Med. Yachts in the past were limited to either being operated privately or commercially, and not both ways, due to PSC and VAT regulations in force in Europe. Things are more complex here than in the Caribbean or in the United States where dual-use programmes are commonly used. Once again, Marshall and Cayman have also been the pioneers in that region of the globe.

Any idea how many yacht owners are YET registered?

So far, and as far as we know, around 15 yachts have been registered under the YET programme, the largest being over 100 metres. Five that we manage/administer have started to operate under temporary YET certificates and started, therefore, to charter from Monaco and France.

One YET yacht which is VAT paid also successfully operated last year in Italian waters under the programme; a second VAT paid yacht shall follow this year. We currently have several other yachts enquiring to be registered as YETs under Cayman or Marshall Islands for the next season. Two thousand and eighteen sounds very promising.

How was it working with Cayman over the seven-month process?

It has been a real pleasure working with Cayman Islands over the past 12 months. Their approach and proactivity toward the YET programme has been superb. Greg, Phil and Angus have a wealth of knowledge and diverse experience, and were always on hand to exchange views and offer solutions. Cayman Islands already have a large fleet of yachts under their Registry and this will no doubt increase with the Cayman YET programme.

Does YET certification affect the buying or financing  process when compared to standard private registration? 

Why should the buying process take longer? Technical compliance and VAT status would have to be reviewed to protect the buyer’s interests in addition to normal due diligence on the seller and on the yacht like for any other transaction. On the technical side, yachts registered under the YET programme are subject to compliance with those standards of a commercially registered yacht, including ISM, ISPS, MLC, MARPOL and other similar regulations.

In the event the buyer would like to keep the yacht registered under a YET programme or under commercial registration, all certification would already be in place. On the fiscal side, the buyer would have to review the VAT status of the yacht. There are no tricks, nothing is hidden from the technical or the fiscal side.

As far as financing is concerned, it would be more a question with regards to the internal policies of banks still offering yacht financing. Can they finance yachts which are registered under Cayman or Marshall  Islands flags? Private or YET registration should not affect the financing process. If banks know how to finance private and commercial yachts, they should know also how to finance YET-registered yachts.

Shipping notices are available and clearly define requirements for each type of registration. Class, local surveyors and insurance companies also start be familiar with this programme and could assist banks to audit yachts prior to any decision being taken by banks.

alexbaldwin
By alexbaldwin January 17, 2018 13:03

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