Demystifying the Industry-Standard Agreement for Your Luxury Charter

For first-time or even experienced clients, the legal and financial terms of a luxury yacht charter can seem complex. At EJ Yachts, we believe transparency is key to building trust. We primarily utilize the globally respected MYBA (Mediterranean Yacht Brokers Association) Charter Agreement, which provides a clear, standardized framework for the industry.

This guide clarifies the three core financial components of the MYBA contract, ensuring you understand exactly where your funds are allocated.

Component 1: The Charter Fee

The Charter Fee is the base price for renting the yacht itself for the duration of your agreed-upon itinerary.

• What it Covers: This fee typically includes the yacht’s hull, the machinery, all operating equipment, the hire and wages of the permanent crew, and the crew’s food and laundry.
  
  
• What it Does Not Cover: The Charter Fee does not cover operating expenses such as fuel, food, beverages, dockage fees, taxes, or crew tips. These variable costs are managed separately by the APA.

Component 2: The Advanced Provisioning Allowance (APA)

The APA is a standard industry practice designed to simplify the management of all variable charter expenses, ensuring a seamless experience without constant payment requests.

• What is the APA? The APA is a monetary advance, typically 35% of the base Charter Fee, paid to the yacht’s captain prior to the charter start date.
  
  
• What is it Used For? The Captain uses this fund to cover all costs incurred during your trip:
  • Fuel (for cruising, generators, and tenders).
  • Food and Beverages (tailored to your preference sheets).
  • Dockage Fees (marina costs).
  • Local Taxes and VAT (if applicable in the cruising area).
  • Crew Gratuity (Tipping): While tipping is always discretionary, the industry standard for excellent service is generally 15% to 20% of the base Charter Fee, paid at the end of the charter. This amount is provided directly to the Captain for distribution among the crew, recognizing their exceptional service throughout your journey
    
    
• Post-Charter Reconciliation: At the end of the charter, the Captain will present a detailed accounting ledger. If the expenses exceeded the APA, you must pay the difference. If money remains, the unused balance is immediately refunded to you.

Component 3: Local Taxes and VAT

Taxes are variable and depend entirely on the cruising location and the yacht’s registration.

• Variable Rates: Unlike a fixed sales tax, VAT (Value Added Tax) on charter fees can range from 0% to 20% or more, depending on whether you are cruising in international waters, the specific country’s tax laws (e.g., cruising tax), and the vessel’s flag state.
  
  
• Clarity is Key: EJ Yachts ensures full transparency regarding applicable VAT and local cruising taxes specific to your chosen itinerary before the Charter Agreement is signed. These costs are managed through the APA.

EJ Yachts: Your Transparent Charter Partner

Understanding the MYBA contract ensures you begin your charter fully prepared and confident in the financial arrangements. At EJ Yachts, we guide you through the intricacies of the agreement, manage the APA transparently, and handle all logistical details so your focus remains on enjoying the pristine luxury of your yacht experience.