http://www.ibi-plus.comwww.ibi-plus.com International Boat Industry | JUNE–JULY 2018 59
worth individuals) – particularly in Asia,
the Americas and Europe – means there
is no shortage of candidates. In fact, only
a very small single-digit percentage of the
hundreds of thousands of UHNWI/HNWIs
own superyachts (see pg96).
At the annual Cluster Yachting Monaco
Rendezvous, held early in June at the Yacht
Club Monaco, leading internationally
renowned yacht designer and vice
president of the cluster Espen Oeino, gave
a presentation entitled 'New generation of
owners – is yachting still fun?'. In this he
covered many of the issues that influence its
current progress and impact upon its future.
In respect of ownership, he referred to a
new generation of UHNWIs that are giving
life to new types of vessels. These wealthy
people, in pursuing luxury, are moving
away from goods and services to unique
experiences. The mix of younger owners
comprises individuals who have earned their
fortunes in high-paying sectors such as IT,
and those with inherited wealth.
With an emphasis on finding unique
experiences for these new owners who are
generally time-poor, finding privacy and
being able to personalise the experience
means combining luxury and the
experience.
It is this trend that is underpinning
the significant growth in the demand for
expedition/explorer yachts, which now
come in all shapes and sizes. Linked to
the experience challenge is the need for
a wider range of toys and tenders such as
submarines, helicopters and seaplanes.RISE OF THE EXPLORER
Also associated to this is the increased
demand for shadow vessels which can carry
the extended range of toys and, if required,
provide added guest accommodation
perhaps for experts related to the
experience. Like expedition/explorer
yachts, shadow vessels now come in all
shapes and sizes and sophistication. The
need for the experience has also brought
into the superyacht market a number of
experts in extreme sports or out-of-the-
way places to meet the specific needs of
yacht owners.
Designers play an essential role. They
constantly have to try to meet the ever-
increasing demands of owners as well as
aligning their designs to new technologies,
materials and the needs of class and
maritime rules and regulations, especially as
superyachts grow in size.The number of designers participating
in the yacht market is rising, as owners
bring in their own people who may have
worked on their property assets or private
jets. This has led to growth in full- and
semi-custom yacht projects, as owners
look to put their own mark on their yacht.
Supporting these trends is the need
for more able project managers, owners’
representatives, build captains, surveyors
and managers. As the sophistication of
yachts and their designs intensify, so does
the need, from a cost-of-build perspective,
to incorporate all or as many as possible of
the features of the yacht right from the start
of planning, because amendments are both
expensive and often cause delays.
As Oeino made clear in his presentation,
while privacy, the different experiences,
family time, parties,
fun and relaxation,
new cruising locations
and healthy lifestyle all
make up one side of the
superyacht ownership
equation, there are other
issues to contend with.
Technology, social
media, security, rules
and regulations, and
VAT are another side of
the equation that can
take the enjoyment out of owning.
Oeino suggested that with the exposure
of yachts to the media – notably the
easy access and spontaneity of social
media – a yacht is no longer a private
retreat. Alongside this is the regulatory
environment for yachts which includes
differing VAT rules, temporary importation,
local chartering rules, and tax-free fuel. In
addition to these are other topics such as
yacht management, with the annual average
cost of maintaining a yacht being said to be
10% of the original cost.PANAMA PAPERS
A growing challenge for wealthy owners is
the increased pressure worldwide for more
transparency about beneficial ownership
of assets, including superyachts. Following
the release of the Panama Papers, for
instance, the demand for more public
registers of ownership is causing real
concern in offshore jurisdictions such as
the Cayman Islands and the British Virgin
Islands.
This is a work in progress and
international links between banks, tax andother fiscal authorities are biting ever deeper
into this sensitive area. It is not only about
bringing more transparency, but combatting
tax evasion and money laundering.
Large yachts and their display of wealth
are also not encouraged in some cruising
areas, as there is a lack of understanding
about the economic benefits that such an
asset can bring – in many cases, amounting
to several thousand dollars. Persuading
governments of this economic benefit in a
bid to introduce charter licences and other
related benefits is a tussle that is underway
in many countries, especially in the Asia-
Pacific region.
What this means for builders, brokers,
designers and others linked to superyacht
projects, ownership and management is that
they need to have clarity
about their clients or
else they may get drawn
into situations they
would rather not be
associated with. Linked
to this are increasing
visits to yachts and
yacht-related businesses
by police, customs and
fiscal authorities.
Earlier this year
Camper & Nicholsons
International (CNI) had a visit to their
Antibes oice by the authorities asking for
specific documentation about yachts, which
they were able to provide thanks to their
good working practices.
For yachts cruising in various areas,
clearance procedures – which can vary
widely from being simple to very complex- need to be addressed by yachts working
in conjunction usually with local agents
or their managers. In several countries
the interpretation of clearance rules by
oicials in difference ports is a problem to be
overcome.
Alongside all of the above is the range of
international, national and regional rules
and regulations that apply to yachts. These
are becoming more complex and stringent
with some including penalties when they
are not met. This bank of regulations
include ISM, MLC, SOLAS and ISPS from
groups such as the International Maritime
Organisation (IMO). From the UK’s
Maritime & Coastguard Authority there
is LYC3 – the large yacht code – and the
Passenger Yacht Code (PYC) that relates to
carrying up to 36 guests.
A growing
challenge for
wealthy owners
is the increased pressure
worldwide for more
transparency