Yacht ownership can enhance your life and the lives of your family and friends. Whether you have a passion for adventurous sailing, serene cruising or are looking for an exclusive setting for entertainment, a yacht offers a multitude of advantages that go far beyond the realm of ordinary living.
A yacht can also serve as a powerful tool for business networking and building relationships with clients, partners and colleagues. It provides an impressive and memorable setting for hosting corporate events, business meetings or product launches.
But all these benefits come at a cost. Aside from the initial purchase price, owning a yacht will typically cost you between 10 and 25% of its value annually in respect of upkeep and operating costs, including: fuel, mooring fees, crew salaries, communications, maintenance, cleaning, insurance, taxes and the costs of depreciation.
A yacht keeps on costing money even when not in use, so the best way to make the most of your investment is to increase its exploitation. Depending on the type of yacht and your location, chartering or renting out your yacht presents opportunities to offset the costs of ownership or even make a profit.
It also guarantees that your yacht will be properly maintained and ready to cruise at all times, and there may be significant tax advantages if your rental revenue is offset by deductions for operating expenses, depreciation and interest deductions.
Dubai – regional centre for yacht charters
Fortunately, you’re in the right place. Dubai is one of the best places in the world for yacht rentals. Situated on the southeast coast of the Persian Gulf and built on a rich maritime history, the city is made for boats thanks to its generous coastline, picturesque islands and luxury marinas. Warm weather all year round here also makes it possible to extend the yachting season even during winter.
Dubai’s ample harbours and marinas invite vessels into the most fashionable districts of the city moments from record-breaking landmarks, fine dining, and designer outlets. Plus, berths are kitted out in state-of-the-art facilities for any luxury pleasure craft or superyacht. Dubai’s strategic location also provides easy access to various international waters which facilitates yacht charters to nearby destinations.
Dubai’s reputation as the entertainment and leisure hub of the Middle East offers the chance to integrate a passion for yachting with an entrepreneurial vision. Dubai’s demographic profile includes a significant number of high-net-worth individuals. Dubai is also a global tourist destination, attracting millions of visitors each year. Together, this creates a substantial market for yacht rental companies, with potential clients seeking luxurious and exclusive experiences on the water.
Dubai has been investing significantly in developing its maritime industry. The emirate’s commitment to marine tourism and infrastructure development, including marinas and waterfront projects, enhances the overall appeal for a yacht rental business.
The Dubai International Boat Show is the region’s top marine event for showcasing a massive array of marine vessels and superyachts from boat makers across the world, as well as attracting boat enthusiasts and affluent individuals who could be potential clients. The show is scheduled to be staged at Dubai Harbour between 28 February and 3 March.
Dubai Maritime City Authority (DMCA)
Yachting is a regulated activity and requires approval from the Dubai Maritime City Authority (DMCA). The DMCA is the government authority charged with regulating, coordinating and supervising all aspects of Dubai’s maritime sector in line with best international practice.
All marine craft must be registered with DMCA and will need to apply for a Dubai Department of Economic Development (DED) License for the business activities for Marine Craft Renting and Operating/ Pleasure Marine Craft Licence, which is valid for one year. All boats must be inspected by the DMCA as part of the registration process. An inspection is mandatory for the application and renewal of a licence for a vessel to operate in Dubai waters or if there is a major modification in the vessel or a change of ownership.
Anyone who operates a boat or yacht around the coast of Dubai is also required to hold a marine craft ‘driving licence’, which is valid for five years. To gain a licence, applicants must pass a test to prove they are medically fit and have knowledge of how to operate a marine craft. DMCA issues the following types of licence for the Pleasure Marine Craft category:
- Pleasure marine craft licence for craft up to 12 metres long
- Pleasure marine craft licence for craft up to 24 metres long
- Pleasure marine craft licence for craft over 24 metres long
- Pleasure marine craft temporary driving licence (visitor licence)
How can Sovereign help?
Setting up a yacht rental company in the UAE as a foreign investor can be challenging. Sovereign has experienced business setup consultants with in-depth knowledge of business practices in the UAE and close connections with key government departments to assist clients with navigating complex regulations and obtaining necessary licences and regulatory approvals.
Within Sovereign, we have Sovereign Marine Services (SMS) which provides a wide range of marine and professional services to yacht owners, managers, and brokers worldwide. SMS registers, administers, and manages yachts across the globe. It also specialises in the provision of ownership structures, VAT and tax planning, yacht importation, safety and technical management, marine insurance and finance, crew administration and payroll, accounting and banking, foreign exchange, and international payments.
We can advise you on the most appropriate activity, Dubai DED licence and jurisdiction to establish your yacht rental company and assist you with incorporating your company, registering with all required regulatory authorities, and obtaining all necessary visas and approvals.
If you need assistance with this or with any other related company formation in Dubai, restructuring, local partner or visa and PRO support matter in UAE or any other related service, please contact us on +971 4 270 3400 email us at info@sovereigngroup.com or complete the contact form below and we will be delighted to assist.
