When buying a yacht for international travel, it’s important to pay attention to how you register it. Your yacht’s flag state can impact privacy, taxes, boarding, etc. The process of deciding which flag to choose can be challenging, so continue reading to learn tips on how to choose your yacht’s flag state.
If you consider buying a superyacht for international cruises and chartering in the Caribbean and the Med, your lawyer or broker will tell you to register and flag the yacht offshore. The flag you choose to fly from your transom can have a direct bearing on your privacy, taxes, exposure to liability and boarding, the vessel’s success as a commercial enterprise, and, ultimately, your enjoyment of the yacht. So how do you decide which flag best serves your purposes?
There is no simple answer that covers every owner, but some basic considerations do apply. The choice of flag state has, over the last few years, become one of the most important decisions owners and/or their representatives must make,’ says Mike Dean of Isle of Man-based Döhle Yachts. A flag state is the country or governmental entity under whose laws a vessel is registered or licensed.
This can be the country in which the owner resides, or more commonly in the superyacht world, an offshore ship registry in a country with laws that are attuned to the complexities of yacht ownership and charter operations. The flag state has the authority and responsibility to enforce regulations over vessels registered under its flag, including those relating to inspection, certification and issuance of safety and pollution prevention documents.