Solutions for chartering business in Montenegro
27 March, 2023
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Now most of our clients think it over: how to make yacht operation profitable?
There are many options, where chartering business is the main one. Montenegro is one of the most popular yachting venues, with lots of advantages such as:
– marvelous landscapes
– comfort climate
– safe navigation in the Adriatic Sea.
Montenegro is often treated as chartering region. So, let us highlight advantages of chartering business in such country.
Since Montenegro has not jointed the EU yet, procedure and terms for launching chartering business is governed by local legislation. However, if Montenegro joins the EU in the nearest future, it may facilitate quite interesting option for owners planning to import yacht in the EU (see our article for details).
As for chartering in Montenegro, first of all we note that commercial operation is available for yachts registered both under Montenegrin flag and under flag of any other state. Meantime, commercial registration is mandatory, which usually provides for primary and annual regular inspections of flag. Hereby we recommend you include inspection costs in the planned budget for chartering business.
Similar to the EU, Montenegrin legislation grants to owner the right on yacht import VAT recovery in case of her commercial operation. Such an opportunity is provided to the owner company as soon as it is registered as VAT payer in Montenegro and files an appropriate application on recovery. It should be noted that the chartering company should be incorporated in Montenegro and registered in the Central Tourism Register.
Montenegrin government proposes for yachting business such options for optimizing taxation, such as decreasing chartering TAX base. For instance, freight on route in international or territorial waters of another state may be partially released from VAT accrual in Montenegro.
We mentioned only some terms and conditions for launching chartering business in Montenegro. Based on your own vision of further business, Interlegal yachting lawyers Valeriia Fetysenko and Mariia Ktrichian will be glad to consult you upon any issues regarding preparation to chartering activity or optimizing the current business scheme.
