The end of charter licences in Greece?

As the new Mediterranean charter season has started, Greece has published a new Law 4256/2014, on 14^th April 2014, dealing with “touristic yachts and other provisions”.

According to leading registration company Monoeci Management, this new law which concerns commercial/private yachts and commercial touristic day-trip boats revolutionises the way yachts will be operated in Greek waters.

To help understand the changes, Monoeci management has explained in detail the situation before and after the new rules. See the differentiation of the rules below.

The situation before:

• A Greek charter licence had to be issued for five years for commercial yachts to enable them to embark and disembark passengers in Greek waters. Contrary to Spain it was possible to undertake one of the two operations without a charter licence (embark or disembark passengers in Greece). In addition, foreign EU entities had to open a branch office in Greece, apply for a local VAT number and pay VAT in Greece on charter fees.
• Documentary evidence had to be kept showing that the yacht was engaged in chartering for at least 200 days (or 300 days where the yacht is below 20 meters) during the five-year period of the licence.
• The issuance of a Greek charter licence was reserved only to EU yachts. Non-EU yachts were not allowed to charter.
• No VAT was applied to EU foreign flag yachts starting their charter in Greece or partially chartering in Greece.
• Yachts under Greek flag and EU yachts having obtained a charter licence had to pay VAT on charters starting in Greek waters.
• The Greek VAT applicable for non-static charters was 13% for one or two days charter and 6.5% for over 48 hour charter. (standard VAT rate is 23%)
• Fuel in certain cases could be purchased without duty and local taxes.

The situation under the new rules:

• An end to the necessity to obtain a Greek charter licence to be able to embark and disembark passengers in Greek waters.
• Abolition of the 10% luxury tax imposed on pleasure yachts.
• EU commercial flagged yachts and non-EU commercial flagged yachts of over 35m (providing they are built of metal or GRP, and can carry over 12 passengers) can now charter from Greece (embark and disembark passengers) by appointing a fiscal representative and registering on the online - Registry of Touristic Yachts and Small Vessels - and submitting an application to the Ministry of Mercantile Marine and Aegean.
• Minimum days of charter over a three year period. 105 days if yacht chartered without crew otherwise 75 days or 25 days for classic yachts and 5% to 20% reductions depending upon the age of the yacht. No minimum days requirement for VAT paid yachts.
• EU yachts still need to obtain a DEPKA and non-EU yachts a Transit Log which are delivered for one year.
• For commercial yachts a declaration must be obtained from the port of embarkation 48 hours prior to departure and the charter agreement submitted.
• Private use by the UBO is allowed when the yacht is not engaged in third party charter. Modalities to be confirmed.
• Possibility to charter with pleasure yachts if allowed by the flag of registration with extra security equipment and survey. Allowed for Greek pleasure yachts but no VAT exemption or Tax benefits. Modalities to be confirmed.
• No changes on VAT and detaxed fuel for commercial yachts? To be confirmed.

For more information, visit Monoeci Management.