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Registering your yacht under a Monaco flag
Superyacht registration under a Monaco flag is one of those things that you do because it is highly prestigious, and not because of common sense, especially when your vessel is over a certain size.
Superyacht registration in general can often be a grey area. It can be a challenging process, one could easily be confused and even industry experts can become unstuck. Even in the Principality of Monaco, there are many legal firms focusing exclusively on legislations around superyachts.
One example is the fiscal (VAT) status of a vessel, and the other the registration process. (jurisdiction and commercial or non-commercial activity of the vessel).
To avoid any confusion, the very first thing one must do is identify whether the vessel will be used for commercial purpose or for private use.
One of the major objectives for superyacht owners is the correct registration and ownership procedure of their valuable asset, especially in regards to having an efficient Tax and VAT structure. This includes, but is not limited to tax jurisdiction, domicile status, or VAT and operational use of the vessel.
The main European Union jurisdictions for registering a vessel are the UK, Malta, Madeira, France, Italy, Cyprus and of course the Principality of Monaco. However, jurisdictions such as Malta, Greece being scrutinised heavily by the European Union.
It is important to know that the flag you choose can have a direct impact on your potential liabilities, privacy and enjoyment. As mentioned before, important future considerations for example are whether you intend to use the superyacht for private or commercial use.
Each flag state has the authority to enforce varying regulations based on their specific requirements including certification, safety, inspection and pollution prevention.
Normally the superyacht owner’s residence and tax status will be taken into consideration, as well as where the yacht will be located.
In general Monegasque nationals and residents can apply to register a boat under the Monegasque flag.
The Principality of Monaco has two primary requirements:
1., All vessels under the Monegasque flag must show their name and the word “MONACO” on the stern, to the exclusion of any other wording.
2., Yachts people who wish to appoint a captain and/or a crew must notify the Department of Maritime Affairs.
The vessel registration is quite simple in Monaco once you have the invoice to prove ownership, examples of this would be photos from all sides of the vessel and the necessarily certificates that accompany the vessel. The application must then be submitted to the Department of Maritime Affairs in Monaco.
An annual naturalisation fee is payable for all boats under the Monegasque flag. Payment must be made within a month from the date of the bill being sent by the Department of Maritime Affairs to obtain the annual stamp. This stamp is essential, as without it, the naturalisation is not fully valid.
It is also important to know that for vessels of over 5 meters, a proof will be requested that the radio complies with all obligations.
Furthermore, for vessels over 7.5 meters purchased within the E.U, you will need to present a confirmation that the boat complies with all tax obligations.
On the insurance side, the yacht, crew and all passengers must be properly insured in the event of accident, incident or liability issue.
One of the misconceptions with yacht registration comes in regards of the moorings. It is highly important to consider that granting permission to navigate under the Monegasque flag does not automatically include the allocation of a mooring in one of the Principality’s ports.
The general rule is based on the first come first serve basis. For this reason, even for long-term residents it is impossible to get a mooring space in the Monaco ports. The waiting list is more than 10 years, and there is no place for short cuts and exceptions through corruption.
This rule is very strict, and even the moorings are not transferable to a new ship belonging to an owner who already has a mooring already in the port, or subsequently to a new owner of a ship that is already moored in Monaco.
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