It is critical that yacht owners ensure that their asset is registered with a quality flag, and that their chosen flag demonstrates compliance with the highest industry standards. Choice of flag affects the ability to secure a mortgage on the asset and dictates the specifications to which it can be built. It also has a direct bearing on the owner’s privacy, tax requirements, and exposure to liability, as well as the vessel’s use as a commercial enterprise; it ultimately dictates where and how the yacht can be used.
The RMI is whitelisted on all the major port State Memorandums of Understanding (MoUs), designated as largely compliant by the Organization for Economic Cooperation and Development (OECD), is in compliance with the Financial Action Task Force (FATF) International Standards on Combatting Money-Laundering and the Financing of Terrorism, and since February 2020, has been whitelisted on the EU’s list of non-cooperative jurisdictions for tax purposes, reflecting the flag’s commitment to the highest standards of global compliance.
Over the past two years, Registry personnel have worked closely with EU regulators to regulate and monitor the RMI’s corporate program to meet updated EU requirements brought into effect in 2018. Following a rigorous process of review and consultation, the RMI Associations Law and Regulations were updated to meet the new EU requirements.
Susanne Andersson, Director of IRI’s Zurich office, explains: “The RMI’s whitelisting and largely compliant rating issued by the OECD reflects the Marshall Islands’ commitment to international corporate governance and taxation standards. It provides a stamp of approval that entities registered in the Marshall Islands are compliant with the highest international standards of financial conduct, which benefits our clients, as it gives them greater flexibility to operate in international jurisdictions and makes it easier to go about their business.”
Patrick Bachofner, Director of IRI’s Geneva office and Worldwide Director, Yachts, adds: “Our compliance with all the major MoUs translates directly into benefits for yacht owners, as these ratings make it easier for them to access finance for assets, operate in more international jurisdictions, and reduce the number of administrative barriers they encounter in the management of their yachts.”
For yacht owners to realize the benefits of their yachts, they need both a corporate structure that can effectively ring-fence individuals from corporate risk, and a registration program that allows them to use their yacht how and where they wish. The RMI Registry fulfils these requirements while providing owners with choice and flexibility. IRI’s decentralized structure, with no agent involved, enables owners’ representatives to go directly to the Registry. Since both the RMI Corporate and Maritime Registries are provided administrative and technical support by IRI, corporate and vessels registration can be completed at the same time and in a timely fashion.
Bachofner explains: “We have developed a very flexible and deliberately simple program that provides a number of options for ownership structures—you may choose to register your yacht through an RMI corporation, limited or general partnership, limited liability company, or a qualified foreign maritime entity. Each of these options provides personal protection from corporate liability, which is important in yacht ownership. In all cases, corporate formations and yacht registrations may be done quickly—typically within a day, if all the documentation is submitted in full.
As a Registry, we have easy-to-follow maintenance requirements and few extraneous costs for owners and representatives. We have developed solutions that meet our clients’ needs, while streamlining and simplify processes to save administrative costs. Our reputation provides a stamp of approval for compliance with the most stringent standards of regulation—and, most importantly, provides our clients with a dedicated, highly specialized, and experienced yacht team with the resources of one of the world’s largest maritime registries.”
