LUXURY YACHT PURCHASE

Where you want to use your yacht and how do you plan to use it? Do you want to charter or maintain it for private use? Are you a diving enthusiast, adventurer, or thrill-seeker? 

While preferences are still being refined, it’s helpful to attend one or two international boat shows where we can arrange for you to step on board any number of vessels to get a sense of size, perspective, and class.

We assess your yacht before shortlisting; this assures that all yachts we put forward are in class, well-maintained, and meet the list price value.

Arranging viewings is done via your broker.  There is usually an opportunity to speak with the captain or chief engineer during the viewing and discuss how the yacht handles in more detail.

A formal offer is made by “you,” the Buyer once a suitable yacht is found. This is usually presented through a ‘Letter of Intent’ (LOI) to agree on the purchase price, followed by an industry-standard contract for the purchase – either a ‘Memorandum of Agreement’ (MOA) or a ‘Purchase and Sales Agreement’ (PSA). These sales agreements outline the timing for the sea trial, survey, acceptance, and closing.

The Seller will accept, reject, or counter your offer to buy. It is rare for the first offer to be accepted, so it usually takes a week or two to receive an accepted offer.

Upon acceptance of offer, depositing 10% of the agreed price into escrow with your attorney or broker is normal. Additionally, once the MOA has been signed by both parties, the Seller must arrange a complete inventory within seven days. The inventory will be signed and form part of the MOA contract to include all the items (onboard and ashore) in the sale.

First stage of the MOA is the sea trial of the vessel, and the Seller must make the vessel available to the Buyer for this purpose.

After the sea trial has been conducted, the Buyer can choose to accept or reject the vessel by providing written confirmation within 24 hours (or before placing the vessel ashore for a condition survey, whichever is sooner). If the vessel is rejected by the Buyer, the deposit is refunded immediately; however if accepted, the Buyer proceeds to survey the yacht.

Depending on the size of the yacht, the survey can take several days to complete. All mechanical, electrical, and electronic equipment is tested during the survey. The objective of the survey is to understand the current vessel’s condition accurately and precisely how much the yacht will cost to maintain in the next few years. As part of the survey, it is strongly recommended for the vessel to be hauled out of the water for inspection. 

Once a survey is complete, a report is sent to the Buyer. Following that, a decision must be made to either accept the yacht’s condition or reject the yacht if defects are discovered during the survey.

Depending on the outcome, you can either:

• Provide written acceptance of the vessel.
• Issue a written notice requiring the Seller to rectify the defects or reduce the sales price, which might result in an extended completion date.
• Issue written notice of rejection of the vessel, specifying the defect officially certified by your appointed marine surveyor, particularly if the defect affects the operational integrity of the vessel, machinery, or systems or renders her unseaworthy.

If there are valid defects, the Seller can choose to repair these defects at their own cost, reduce the price of the vessel accordingly to cover the costs of repairing these defects or decide not to proceed with the sale of the vessel.

With a price negotiated, sea trials and surveys conducted and accepted, we are 90 per cent there. The hard work on the Buyer’s front is pretty much over, and all that is left is for the Buyer’s broker to ensure that every piece of documentation is in place to enable the Buyer to take ownership of the vessel.

In this final stage, your broker will check all the requirements of the Flag State (Flag) and Classification Society (Class) to complete the sale. They will also investigate insurance requirements necessary for ownership and handover.

Completion involves signing the Bill Of Sale and handing over all valid original documents (provided by the seller) in exchange for the balance transfer of funds (provided by the Buyer).

The Captain will need all the necessary original documents of the yacht on board, ready to be presented to the Buyer’s representative at completion.

Once all the documents are in order, simultaneously, the balance of the purchase price is transferred to the seller. The protocol of delivery is then signed by both the Buyer’s and Seller’s representatives onboard the yacht. It states the time and place of the transaction, as well as the current condition and position of the vessel. The yacht’s positioning for delivery is important, as it will determine any potential tax implications of the transaction.

SALT Superyachts will conclude the Flag and Class documentation requirements, including issuing a new registration with the new owner’s name and address.