(Frequently Asked Questions)
I had a discussion with a catamaran buyer that was interested in catamaran charter ownership.
The visit to Ft Lauderdale was most enlightening - I truly appreciate the time you spent showing me around. There is nothing like a firsthand view! Let's talk Lagoon 400. I like what I see so far - I would declare this to be my "favorite" model (of course I am still open for discussion!). In my view the 4 cabin / 4 head layout is the only way to go with charter in mind. I also like your suggestion of placing the boat in the BVI's. I certainly do not see any reason to involve tax hungry entities...
What is poor/reasonable/ideal time for purchase?
For new boats like the 400 the factory has two price increases each year (usually 2-4% each time) and this occurs in Sept/Oct and March... so, it's best to act before those happen.
How are legally binding buy/sell commitments communicated?
We execute a purchase agreement... I'll send you a proposal.
What is jurisdiction for transfer of ownership?
Usually where funds run through... if it's through my escrow account in Florida then you gain U.S. Juriscidction and all buyer's rights which apply in the U.S... these are the strongest protections in the world for a yacht buyer.
Who has what responsibility at which time in ownership transfer process?
Once you sign an agreement you must come up with a 10% deposit... when the boat is ready (the next 400 is available in August ex. factory in France) then you have to remit the balance of funds. Then the charter company assumes all financial responsibilty (binds/pays for insurance, handles delivery to the base, pays for dockage, pays for maintenance, etc). Your responsibility is very minimal after the final purchase payment is made.
What is best location/country for transfer of ownership and registration?
There are many. I think St. Vincent is the cheapest-best.
How does transfer of ownership and registration process work?
A bill of sale, manufacturer's statement of origin and warranty are issued at closing and Fedex'd to you when final payment is made. Registration is handled by a marine documentation agent who we help you hire.
What is best legal structure for entity owning the boat?
I believe an offshore corporation (like an IBC in St. Vincent or BVI) is best... this affords maximum privacy for a minimum price (it's cheaper than B.V.I., Cayman Islands, etc.)
How do my citizenship and/or country of residence affect boat ownership in location/country of registration?
It doesn't... the yacht assumes the national identity of the place of registration and the beneficial owner's nationality doesn't come into play.
How does transfer of funds process work?
You wire 10% of funds to our escrow account to reserve a slot when we sign a purchase agreement... the other 90% is due when the yacht is launched... the escrow account is registered with the state of Florida and funds cannot be disbursed until the contract calls for it.
What insurance is recommended for which part(s) of ownership transfer process?
The factory covers the boat until finished... then the yacht joins the charter company "fleet" policy with you as loss-payee. The charter company pays for this.
What time line am I looking at between placing order and taking delivery?
If you ordered today you would get a boat coming off the assembly line in August. if we don't sign anything for 1-3 months then it can be delayed because "it's first come, first served" and whomever puts down 10% deposit gets the next slot(s)... sometimes the factory will stop production of the 400 to focus on another model and it may not be available for another 6-12 months... for example, the 420's are not in production now because that factory is building 380's... so 420's won't be available for another year. The factory builds each model in batches to achieve "economies of scale" and when a "batch" is sold out you can't get that model again until they start a new batch.
What paperwork is required and what paperwork needs to be initiated at which time?
Let's say we decide on what equipment you prefer now (we first go through the list of options) and you agree to reserve a boat. Then we sign a contract and you send a 10% deposit by wire transfer. This reserves the boat/slot. I'll send you a recommendation of equipment (that the charter manager recommends) along with pricing.
How do I get in touch with charter company of choice?
I am a duly-authorized agent for dream yacht charters and others... but I recommend we do it with Dream Yacht Charter because it's the only one who will do a 9% "guaranteed income" program in the BVI for a Lagoon 400. That means you will receive 9% (of whatever you paid for the boat including delivery to the base) guaranteed income each year (payable monthly for 66 months)... so, for example, if you pay $400,000 total for the boat/delivery; you then get 9% of that or $36,000/year until the end of the program... you essentially get back 49% of what you paid for the boat! This is the best deal out there. You will have owner's use of a Lagoon 400 at any of their 30 bases around the world of a 400 or equivalent/smaller boat for up to 12 weeks/year. So, let's say you are working in the far east and need a vacation nearby... just contact Dream and book a week at a nearby base... I recommend using your weeks around the world.
How is contract formulated between owner & charter company?
I'll send a proposal contract to look at... that will explain it best.
While the boat is in charter what are the responsibilities of charter company and owner?
You have next to none except to have maximum fun with your boat! The charter company handles everything for you. They totally manage the boat and pay for everything for you. This is the easiest yacht ownership "known to man".
What is your role as yacht broker (i.e. what do you and/or do you not facilitate)?
I help you negotiate the deal, I coordinate the purchase process and closing paperwork to transfer title to you.
Contact Gary Fretz for more information regarding Catamaran Charter Management by calling call 001.954.609.6282 or at BigYachts@gmail.com.
Ft Lauderdale, FL 33316, USA