This is the first of a series of articles about the impact of BREXIT on the yachting fraternity. It focuses on the considerations surrounding the import and export of secondhand vessels and is based on real examples from our surveying clients. Future articles will chronicle our own experiences of entering the EU as a cruising yacht and an overview of some the challenges, myths and options posed by the Shengen 90-day limitations.
Case Study 1: importing a vessel from outside the EU into the United Kingdom – and then selling it.
Overview. The current owner purchased a secondhand yacht in the USA, sailed it over to the UK and now wants to put it on the secondhand market in UK.
The vessel was built in Florida, USA in 1986 and operated in the Caribbean, California and the West Coast of the USA until purchased by the current British owner in 2010 and sailed to Europe shortly afterwards. She was registered on the UK SSR at that time and formally imported into the United Kingdom in 2012 when VAT was paid. Since then, she has been extensively refurbished.
The vessel was constructed before the EU Recreational Craft Directive came into force in 1998. The current RYA guidance[1] states that
A watercraft needed to comply with the RCD if it was/is:
1 • first placed on the EEA market after 16 June 1998; or
2 • put into service in the EEA after 16 June 1998 (whether manufactured in the EEA or imported from outside the EEA); or
3 • a home-built boat placed on the market within five years of completion; or
4 • imported from a third country without CE marking
It seems pretty clear that the vessel would need to comply with the RCD (and the UK equivalent, the Recreational Craft Regulations) under paragraphs 2 and 4 above in order to be offered for sale in UK or the EU. It might be argued that as she was already in service outside the EEA in 1998, then strictly speaking she was not ‘put into service’ after 1998 when she arrived in the UK. On the other hand, there is little dispute that she was imported into the EEA after 1998 without a CE marking.
Even if you accept the ‘built before 1998’ argument, we suggest that the principal difficulties arise now that the vessel is being offered for onward sale. The original purpose of the RCD was to set standards of safety for recreational vessels; whilst the current owner, as a private importer, was using the vessel for his own use, the ‘authorities’ would have little specific interest in the vessel. For example, if a private importer brings an antique ivory into Europe as part of their personal collection, nobody minds too much. But if they wish to sell that ivory on the open market, there are strict laws. The same principles apply in this case (except that clearly they focus on safety).
Articles 19 and 23 of Directive 2013/53/EU[2] state that the importer is obliged to initiate a post construction assessment procedure carried out by an Approved Body before the vessel can be placed on the market. The RYA guidance states:
Article 19(2) of Directive 2013/53/EU requires that a private importer applies the post construction assessment procedure referred to in Article 23 before putting into service a product that falls within its scope if the manufacturer has not carried out the conformity assessment for the product concerned.
If you are temporarily importing a boat into the EU for a short holiday you are unlikely to be considered to be putting a product into service in the EU, but if you own a boat which is released for free circulation in the EU (kept in the EU) it will need to comply with the RCD.
Post BREXIT, the RCD principles were transposed into the UK Recreational Craft Regulations 2017 as amended by the Product Safety and Metrology Regulations 2019. The guidelines for private importers state:
A private importer is any natural or legal person (e.g. a company) established in the UK who imports in the course of a non-commercial activity a product from a country outside the UK with the intention of putting it into service for their own use.
The obligations of private importers include:
If a private importer imports a product that has not previously been placed on the GB market, where the manufacturer has not carried out the relevant conformity assessment procedure, the private importer will have to carry out a post construction assessment to demonstrate conformity with the Regulations, as set out in Schedule 5.
The private importer must ensure before putting recreational craft into service that it has been designed and manufactured in accordance with the essential requirements.
The private importer must ensure that the obligations for manufacturer covering technical documentation; declaration of conformity; relevant marking; instructions and safety information; provision of information and cooperation have been met or carried out.
Where technical documentation is not available from the manufacturer, the private importer must have this drawn up using the appropriate expertise.
The private importer must ensure that the name and postal address of the approved body that carried out the relevant conformity assessment procedure in relation to the product is marked on the craft.
These guidelines are laid out in Section 36 of the UK RCR Regulations and are designed to ensure that recreational boats are not knowingly operated or traded in an unsafe state. We consulted two leading UK and International yacht brokers about this case. Their advice was consistent: the vessel needs to have a RCD Post Construction Assessment Certificate before it can be sold in UK or the EU. Indeed neither of them would be prepared to list the vessel for sale without such a certificate. The onus lies with the current owner, not the prospective purchaser. Failure to comply will certainly limit the resale options for the vessel in the EEA; it might result in the vessel being impounded by UK or EU authorities; it may also compromise any insurance claim, particularly given that no definitive builder’s statement as to the seaworthiness and design of the vessel for offshore sailing was located during the survey.
The outcome of all of this was that the current owner was unable to legally offer this yacht for sale on the UK market. In our view, he had two options:
- Sail her back to the USA and sell her there.
- Bite the bullet and spend the money organising compliance with the Recreational Craft Regulations. Basically that requires an inspection by an Approved Body to acquire a Post Construction Assessment Certificate. The most time-consuming element of this is likely to be the compilation of documentation to generate an ‘owners handbook’. The most expensive element may entail replacing equipment installed after 1998 (when the EU RCD came into force) that does not have an EU CE Mark. The ‘Approved Body’ could charge anywhere between £500 and £5000 for their work…
- If he wants to sell the boat into the EU, he needs to read Case Study 2!
[1] Extract from the RYA RCR and RCD Guide for Boats dated February 2023
[2] Directive 2013/53/EU of the European Parliament and of the Council of 20 November 2013 on recreational craft and personal watercraft and repealing Directive 94/25/EC (Text with EEA relevance) (legislation.gov.uk)