Story by Andrew Holland / June 1, 2018
Occasionally we handle transactions where either a buyer or seller require a closing to occur outside of the area where the boat is currently lying. This is what we call an “offshore closing”.
The main reason that either party would request an offshore closing most often directly coincides with potential taxation or duty ramifications on the sale of the boat in it’s given location. To avoid these potential costs, the buyer and seller may agree to perform a legal offshore closing on the sale of the boat.
An offshore closing can be defined as when a boat is sailed into international waters on the agreed day of closing – the required distance offshore for closing will depend on the boats location – and finalization of the closing documents is done directly on the boat once you are in international waters. Photos are taken of the GPS coordinates and signing of the required documents, along with a photos of the signer with a copy of the days newspaper to provide photographic evidence of the time and location of the finalization of the closing documents.
Offshore closings are most often seen in states like Florida, California and in various countries in Europe.
While an offshore closing does require logistical consideration that can potentially complicate the closing process, it does present potentially advantageous legal methods to avoid tax and duty on the purchase or sale of a vessel depending on the details of the transaction.
The procedure and requirements for an offshore closing will depend on the boats current location and where she intends to re-enter the country after the closing, so if you intend to proceed with an offshore closing it is important to consult with professionals to discuss the legal requirements that must be followed.
For questions, feel free to contact the Multihull Company offices at 215-508-2704.
My wife and I worked with Andrew Hodgdon to sell our 2021 FP Elba 45. In addition to skillfully carrying out the traditional yacht broker responsibilities, Andrew went above-and-beyond to ensure that we were well-positioned to sell in a competitive market. For example, Andrew helped out with much-appreciated repairs and hurricane prep, among other things. Trustworthy, intelligent, and conscientious, Andrew’s communications with us and the buyer were always thoughtful and forward-thinking, and fairly represented our interests.
We really lucked out in connecting with The Multihull Company. We made a cold call to Cynthia Wummer, a Multihull Company broker and told her we wanted to buy a catamaran to cruise The Great Loop and experience the Bahamas. We particularly wanted a PDQ power catamaran. From our first contact she was so helpful and responsive. She immediately contacted a selling broker who represented a prospective seller. Because we are new to a bigger boat and boating on the ICW, Cynthia assisted us through the entire process. She is a captain which was an added bonus to the process; she knew all the right questions to ask the selling broker as well as the surveyor. She drove 3 hours to be present during the survey, she developed a good relationship with the selling broker, she called and checked in with us regularly, was very enthusiastic about our purchase, and answered all our questions. We could not have done it without her. The Multlihull Company support team, Andrew Holland and Courtney Greider, were so helpful in the closing process: the paperwork was easy to complete and communication was smooth and timely. We wouldn’t hesitate to recommend The Multihull Company and Cynthia to anyone who is the market for a boat large or small. Thank you!!!!
Multihull Company has succeeded again. This is my second time using their services and they are extremely professional and honest. Working with their brokers and their administrative team was easy. Communication occurred at every level and constructive advise was always given. They know this business inside and out and acted as my fiduciary in every way. I will use them again for their service and knowledge.
Great to deal with and very patient in our questions. They were able to find us the perfect vessel for our needs.
Successful relationships cannot exist without it. At The Multihull Company we base every relationship on a firm commitment to earning and retaining our client’s trust.
Advice of any kind is valuable only when grounded in hard-won expertise. It too, must be trustworthy. Trust and expertise define the heart and soul of The Multihull Company. We are a team of skilled professionals who thrive on providing expert, trustworthy advice and service to catamaran and trimaran sailors around the globe.
Read More
