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The Croatian Ministry of Maritime Affairs has just formally confirmed the anticipated changes to the regulations governing charter activities in Croatia.
While the changes are essentially what the industry had been expecting, there is one unforeseen (and welcome) modification.
Under the new regulations, charters starting outside the EU will be subject to 13% VAT in Croatia on a pro-diem basis. However, if a charter contract for a charter scheduled to start outside the EU and cruise in Croatian waters is executed and the charter fees paid before May 1, 2017, no VAT will be charged on the fees for the number of days spent in Croatia. This provides clients with a very narrow window to save 13% on the value of the charter.
In addition to the point above, below is a summary of all other changes that will be effective as of May 1, 2017.
1.Restrictions on non-EU commercial yachts under 40mt chartering in Croatia have been suspended. All non-EU commercial yachts may charter if equipped with a valid charter license.
2.All non-EU commercial yachts must purchase a charter license even if the charter starts outside Croatia in another EU or non-EU country.
3.Yachts flagged Isle of Man, Gibraltar and the Channel Islands do not need a charter license since the flags are now deemed to be EU.
4.If demand is too high, Croatian Ministry of Maritime Affairs may provisionally suspend the issuance of charter licenses for up to 3 months.
5.Charter license can be purchased through a licensed ship agent and are valid for one calendar year.