This has been the case for a long time and it is likely to remain so for the foreseeable future.
There are numerous reasons for this, none of which will be explored here, but in simple terms, the region between Monaco and St Tropez is simply stunning. In addition, the climate is perfect year
|Super Yachts Blade, Adriana and Starling in Fontvielle, Monaco|
French VAT uncertainty:
The introduction of new VAT rules to all super yacht charters as of July 2013 has however created a number of uncertainties prior to being announced. A number of clients who wanted to charter super yachts such as a Ferretti 80', a Perini Navi 45m or a Benetti 55m, at least a dozen of them, all decided either to delay their booking or to switch the destination all together. And while this did not affect the success of the luxury crewed charter season here in South of France in any big way, it certainly did increase number of enquiries and certainly bookings too, to other destinations, namely Croatia, Spain and Greece to name but a few. This is mainly due to uncertainty, rather than the extra costs.
|Monaco's luxurious swimming pool at Port Hercules|
On the other hand, once new rules were published, one regular charterer, who hires at least three different yachts out of Monaco or St Tropez every year, during different seasons and for a range of different occasions, reported as being totally upset with the French governement. He thought of himself as a resident of Monaco and as such did not assume or want to pay any additional costs. For him and his party, this additional costs was unacceptable so instead of chartering three yachts, they have taken up only one in France and even so, decided to start and finish the charter in Monaco, rather than in St Tropez as it was usually the case, all in order to avoid any chance of having to pay the additional 9.8% reduced VAT rate. The new VAT rate is actually, 19.6%, yet for yachts which spend at least 50% of their charter time outside French Territorial waters ie. 12nm from shore, it is possible to apply reduced rate.
|Luxury Yachts moored in Mahon, Menorca in the Balearics|
|Mega charter yachts moored in Marina Icici, in Opatija, Croatia|
as magnificent Puerto Banus and trendy Malaga in the Costa del Sol, historic Barcelona on Costa Brava and the whole of Balearics are equally prestigious as South of France yacht charter locations are, this could mean that longer term some of the yachts will move from France to Spain. On top, certain locations in Montenegro, Croatia, Greece and Turkey are increasingly creating their own glamourous events, clubs and destinations in their own right, so that in the longer run, we may indeed see a transfer of super yacht lifestyle from South of France to other parts of the Mediterranean, at least to a certain extent.
In case you would like to add your own comments, experiences or ideas to this argument or even enquire about current situation with French VAT being applied on luxury crewed and mega yacht charters in South of France, please drop us a line at email@example.com .