The Geneva Convention on the High Seas, adopted on April 29, 1958, stipulates that seas and oceans are open to all nations. No country has the right to subject the high seas or any part thereof to its sovereignty. In practice, this means that every individual, regardless of their citizenship, is free to travel the high seas without hindrance. However, this does not negate the requirements for mandatory registration of yachts and maritime vessels.
Registration provides a vessel with a certain analog of nationality, ensuring its security and safety on the high seas. From a legal standpoint, yachts and vessels without registration do not fall under the purview of international laws. Maritime laws and customs do not specify particular countries that have the right to register yachts. Additionally, there are no requirements to restrict the choice of registration based on the owner’s citizenship.
Do you want to know which countries have the largest number of yachts, boats, and cruise ships? Read our new article on this topic!
Attention! Registering a yacht in the Cayman Islands is possible not only for individuals but also for offshore companies. However, for your new business to meet all your requirements, it is crucial to carefully select the jurisdiction, taking into account all relevant circumstances. Restricting yourself solely to the Cayman Islands is not advisable. We are ready to offer you many interesting and promising options. All the details will be provided during a free, personalized consultation.
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on which jurisdiction is best for
your business, preferred tax regime,
company structure.
on which jurisdiction is best for your business, preferred tax regime, company structure.
One of the options widely considered the gold standard is the Cayman Islands. A yacht owner who chooses almost any other jurisdiction for registration will encounter certain limitations. In most cases, these limitations may not be critically important but rather inconvenient, yet they cannot be ignored. For every argument in favor, there will be counterarguments against, making the final decision largely a compromise.
The Cayman Islands, as a jurisdiction for yacht and vessel registration, are virtually free from significant drawbacks. There are specific conditions to keep in mind, but this can generally be said of any country offering such services. However, before submitting documents for registration, discussing all available alternatives with an experienced lawyer and tax consultant is advisable. Ideally, this should be done even before purchasing the vessel or initiating construction at the shipyard.
Key aspects of yacht registration in the Cayman Islands:
- registration validity – 1 year
- procedure duration – typically 1-2 days
- base cost – starting from USD 1,499
- expedited yacht registration available
- permissible vessel usage options – private, commercial, bareboat
- extension of yacht registration in the Cayman Islands entails payment of applicable taxes and fees
- no restrictions on the vessel owner’s nationality for registration
- no VAT payment required
- yacht registration in the Cayman Islands is globally recognized
- mandatory technical inspections can be conducted on-site.
To fully appreciate all the advantages of this jurisdiction as a flag state for maritime and oceanic vessels, it would be best to use the services of a knowledgeable specialist well-versed in local legislation. While it is theoretically possible to undertake yacht registration independently, in practice, choosing this route often leads to unnecessary difficulties that can easily be avoided. Therefore, we strongly recommend entrusting administrative matters to an experienced lawyer.
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Who can own a yacht under the flag of the Cayman Islands?
The jurisdiction’s legislation provides various ownership options, which sets the Cayman Islands apart from other countries with fewer alternatives and more restrictions. When multiple ownership options are permissible in a specific case, choosing the optimal one becomes crucial.
Direct 100% ownership of a yacht/vessel (individuals – individual or joint ownership, legal entities – company or shipping organization) is available to:
- citizens/legal entities from the European Union countries
- citizens/legal entities from countries within the European Economic Area
- citizens/legal entities from jurisdictions listed in the Third Schedule of the Cayman Islands Money Laundering Regulations.
All other individuals can initiate the yacht registration procedure in the Cayman Islands but only under the conditions of collective ownership (shares ranging from 31% to 64%). Legal entities established in other countries but registered in the Cayman Islands as foreign companies can own yachts and vessels here if their business is connected to the jurisdiction (a qualifying condition being the place of board meetings).
! Attention! If the yacht owner (individual or company) is not a resident of the Cayman Islands or not registered here, they need to appoint an official representative who meets these requirements for the vessel registration (this must be done before submitting the registration application).
Countries, overseas territories, and associated states whose legal entities and individuals can own yachts and vessels in the Cayman Islands include:
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- Anguilla
- Argentina
- Aruba
- Australia
- Austria
- Azores
- Bahamas
- Bahrain
- Barbados
- Belgium
- Bermuda
- Brazil
- British Virgin Islands
- Bulgaria
- Canada
- Canary Islands
- China
- Cyprus
- Czech Republic
- Denmark
- Estonia
- Faroe Islands
- Finland
- France
- French Guiana
- Germany
- Gibraltar
- Great Britain
- Greece
- Guadeloupe
- Guernsey
- Hong Kong
- Hungary
- Iceland
- India
- Ireland
- Isle of Man
- Israel
- Italy
- Japan
- Jersey
- Latvia
- Liechtenstein
- Lithuania
- Luxembourg
- Madeira
- Malta
- Marshall Islands
- Martinique
- Monaco
- Netherlands
- New Zealand
- Norway
- Portugal
- Romania
- Singapore
- Slovakia
- Slovenia
- Spain
- Sweden
- Switzerland
- United Arab Emirates
- USA.
The Cayman Islands have introduced the new Beneficial Ownership Register Rule. Read its review from our experts!
Variety of yacht registration types
Potential vessel owners will have a plethora of options to choose from. One of the critical advantages of yacht registration in the Cayman Islands is the absence of a one-size-fits-all approach. Finding a suitable option tailored to your specific circumstances and requirements is entirely feasible.
Yacht and vessel registration options under the Cayman Islands flag:
- Complete registration with the issuance of a Certificate of British Registry. This option applies to new yachts that meet specific requirements at the time of completion.
- Intermediate/Transitional registration. It is used when re-registering a yacht in the Cayman Islands that was previously registered in another jurisdiction. This option is typically employed when the new owner is an individual.
- Limited-duration registration. A special expedited Certificate of British Registry is issued when the Certificate of Survey is physically unavailable. The duration of this registration option is 90 days.
- Registration for vessels under construction. Additional conditions apply concerning the place of construction (shipyard).
- Dual (Bareboat) registration. This is temporary registration for vessels engaged in bareboat chartering without crew or equipment. It is the only legal option for a yacht to be legally flagged to two countries simultaneously. Options include Demise Charter-Out and Demise Charter-In.
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Other advantages of registering a boat in the Cayman Islands
The range of jurisdictions willing to grant their flag to private yachts is quite extensive. Therefore, many potential boat owners prefer more cost-effective options. In certain typical cases, this approach may be conditionally acceptable. However, when evaluating the yacht registration process comprehensively and considering all the advantages and disadvantages, the Cayman Islands emerge as virtually unrivaled. The modest overpayment (relative to other jurisdictions) is fully justified and well worth it!
Why register yacht in the Cayman Islands:
- British Registry. The Cayman Islands Shipping Registry (CISR), which comprises the list of all vessels flying the Cayman Islands flag, is part of the Red Ensign Group (United Kingdom and Commonwealth countries, Category 1). Consequently, the Cayman Islands have the authority to register vessels of practically all sizes and types. It is also important to note that all ships under the flags of any Red Ensign Group member country are under the protection of the Royal Navy.
- Favorable and stable environment. As a British overseas territory, the Cayman Islands exemplify a modern jurisdiction where all conditions are created for living, leisure, conducting business, raising children, and investing. The political, financial, and economic situation here is truly stable, with an extremely low probability of any significant changes to the established position.
- Highly convenient yacht registration conditions. The registration procedure is streamlined, virtually free from bureaucratic delays, and can be completed within 24 hours (upon submission of all required documents).
- Global offices. Membership in the CISR family ensures maximum flexibility and convenience in the Cayman Islands yacht registration process. Vessel owners are free to choose the most convenient option for themselves. Offices where yacht registration documents can be submitted, are located not only in the Cayman Islands but also in the United Kingdom, the United States, and Southeast Asian countries.
- Tax neutrality. The Cayman Islands have no major taxes (personal or corporate income tax, capital gains tax, value-added tax, and withholding tax). There is no currency control, and the stamp duty on property transfers is only 7.5%. As a result, the risk of information leakage regarding the transaction is minimized.
- Modern and well-developed legislation. The legal framework for yacht registration in the Cayman Islands meets all current requirements. There is no risk of encountering any issues related to gaps in relevant laws.
- Diversity of yacht and vessel registration options in the Cayman Islands. The vessel owner can choose the most suitable pattern tailored to their needs.
Registering a yacht in the Cayman Islands is the gold standard in cases where the sum of characteristics truly matters. The procedure is highly streamlined and offers the vessel owner ample options, with its outcomes recognized worldwide.
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