Unlocking Luxury Yacht Charter Adventures: Your Guide to Demise Agreements
Are you dreaming of an opulent voyage on the high seas, but with the freedom of controlling your yacht like a seasoned captain? Welcome to the world of Demise Agreements, a unique concept that's gaining traction in the luxury yacht charter industry. If you're seeking the ultimate maritime adventure, Myst Yacht Charters has the answer.
What is a Demise Agreement?
Demise agreements, sometimes referred to as "bareboat agreements with a separate Crew Employment Agreement," offer an exclusive and personalized way to experience the world of luxury yachting. These agreements differ from standard charter arrangements and are particularly popular for certain types of vessels.
US Documented Vessels with Recreation Endorsement
One of the primary use cases for Demise Agreements is for US Documented vessels that operate under a Recreation Endorsement. In cases where a US Documented vessel has a foreign-built hull, chartering under Demise is permitted if they have a Recreation Endorsement. This allows charterers to explore the seas in their own style.
Foreign Flagged Vessels with Recreational Use
Additionally, certain foreign-flagged vessels operating primarily for recreational use may opt for a Demise Agreement, especially when the vessel doesn't fully comply with Maritime and Coastguard Agency (MCA) codes. These agreements offer flexibility and a unique opportunity for charterers to customize their experience.
How Does a Demise Agreement Work?
Under a Demise Agreement, the charterer assumes a role akin to that of a yacht owner. This means they take possession of the vessel and become responsible for all aspects of its operation. In essence, the charterer becomes the captain of their ship, steering their journey through the world's most breathtaking waters. However, it's important to note that they can also employ a captain to operate the vessel, provided the captain is properly licensed for the charter's destination.
The crew on the yacht cannot include the owner of the vessel, ensuring that the charterer has full control of the experience. This separation of roles guarantees that the charterer's wishes are the top priority throughout the voyage.
The 80/20 Split Agreement
Demise Agreements typically follow an 80/20 split structure. This means that 80% of the charter fee is allocated for hiring the vessel itself, while the remaining 20% covers crew hire under a separate employment agreement. This setup not only offers a unique and personalized experience for the charterer but also provides tax benefits for both the owner and charterer.
By segregating the yacht hire fee from the crew hire fee, sales and use taxes are only applied to the yacht hire portion. This division ensures that both parties can enjoy fiscal advantages while experiencing a top-tier yachting adventure.
Insurance Protection in Demise Agreements
When chartering under a Demise Agreement, it's crucial to consider insurance coverage. The charterer should be aware of the insurance limits and deductibles provided by the owner's policy, as they may be held responsible for these in case of any damages or incidents.
Charterer’s Liability Insurance can offer additional protection in the event that the charterer is named in a lawsuit arising from the charter. However, it's essential to note that this insurance does not cover the owner's deductible or any hull coverage not included in the owner's policy.
Experience the Ultimate Luxury Yacht Charter with Myst Yacht Charters
Now that you're well-versed in the world of Demise Agreements, it's time to turn your maritime dreams into reality. Contact Myst Yacht Charters for a personalized consultation and start planning your unforgettable yachting adventure today. Whether you're charting a course for a romantic getaway or a grand celebration, we're here to make your journey extraordinary.
Explore Our the Luxury Yachts we offer
Discover the range of luxurious vessels available for charter with Myst Yacht Charters. Whether you're interested in sailing yachts, motor yachts, or catamarans, we have the perfect options to suit your preferences. Search Now Explore our fleet to find your ideal vessel. You will frequently see Demise agreements use for charter in US waters such as New England and the US Virgin Islands. As always, there are more yachts availalbe than will come up in our online search, so contact us today for a personalized quote!