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Cruising after Brexit in Europe

Cruising after Brexit in Europe: temporary admission 

Following the exit of the United Kingdom from the EU, many are wondering about the consequences of Brexit for the right to navigation of UK-flagged vessels.

Since the entry into force of Brexit, the only provision which may be referred to is the Circolare No. 49/2020 issued by the Customs and Monopolies Agency, it states that starting from January 1, 2021 the United Kingdom has to be considered as a non-EU country.

In view of this, vessels flying the UK flag (i.e. the flag of the United Kingdom, not including protectorates) in the European territory will be required to observe the 18-month temporary admission, which allows them to remain for the limited period of 18 months in a country of the European Union, without paying and/or guaranteeing customs duties.

After such a time frame, which starts from the date of submission of arrival certificate issued upon arrival in port by the port authorities, or, in absence of it, from “the verbal temporary admission”, the yachtsman will have to pay import VAT in order to remain in the territory, while maintaining the UK flag (Article No. 60 Law Decree dated January 24, 2012, No.1).

Cruising after Brexit in Europe: what VAT am I subject to after Brexit? 

From January 1, 2021 the United Kingdom is no longer part of the common customs area of the European Union and, therefore, the circulation of goods from and to England is considered trading with a non-EU country.

Accordingly, navigation in English, Scottish, Welsh and Northern Irish waters is considered as navigation outside the EU. Specifically, trade of goods is subject to import-export customs rules, and cost of goods will include duties.

Indeed, once European goods arrive in the United Kingdom, they will be subject to import customs procedures, and will be marked “UKCA” (certification of “CE” conformity issued by the Union).

Products from Italy entering the United Kingdom will be considered as “non-Union goods” coming from a “third country”. Sale to the UK will no longer be a trade within the EU, but exportation.

Althout this type of operation is not subject to VAT, customs duties will be paid for exportation.

An exception is granted to cargo ships, and to all carriers: i.e. goods movement operations of entry into the UK and started before January 1 will be considered as trade within the EU.

Cruising after Brexit in Europe: the rules to purchase a boat 

Following Brexit anyone who wants to purchase a UK-flagged boat has to take into account certain rules. Will the location in which the boat was on December 31, 2020 at 11 pm be relevant?

In case the boat to be purchased at the above-mentioned time was located in a non-EU terriotory, for instance the United Kingdom, in order to import the vessel into Europe, it is necessary to pay VAT.

In case on Decemeber 1, 2020 at 11 pm UTC the boat was located in the territory of one of the 27 EU Member States, it shall be considered free to move (having the European status) and will be allowed to move freely for all the time it remains within the EU 27, as long as it can be proved that the vessel was stationed within the EU 27.

It is essential to get and keep all the documents which demonstrate that the boat was stationed in the territory of the EU at the moment in which the transition period ended.

Cruising after Brexit in Europe: how we can help you 

The Arnone & Sicomo International Law Firm has an internal maritime law and admiralty law department. Our maritime lawyers guide our clients during procedures of purchasing and selling of an type of vessel, besides, they support clients during procedures of reflagging.

In addition, we assist our clients in fiscal procedures which must be undertaken to import a yacht or any recreational craft into the EU.
Have you got any questions on the effects of Brexit on maritime law in EuropeContact us.