Expert Insight into the Rise of the East Med Superyacht Scene
In recent years, the landscape of superyacht ownership and chartering has witnessed a radical revolution. We heard from Christina Economou, Business Development Director at Trident Trust Cyprus, on how various factors – both new and old - have aligned to create ‘the rise of the East Med’ as the world’s new favourite superyachting destination.
2021 has been a record year for the industry, with shipyards and brokerages citing a pandemic-instilled ‘bounceback’, vast order books and even a record year for second-hand superyacht sales. But it is not just buying patterns, but also how owners look to use and enjoy their superyachts, that is beginning to shift.
With the traditional yachting hotspots such as France and Spain enjoying fewer superyacht visitors than the previous years, Trident Trust marine experts mention complex tax and VAT regulations applying to non-EU vessels as disrupting the traditional ‘milk run’ of yachting as we once knew it.
Not only this, but recently introduced measures to protect marine life in these areas also appears to be discouraging superyacht visitation.
Christina explains, ‘Vessels over 24m (or 20m in some cases) are now prohibited from anchoring, mooring or otherwise stopping within protected areas, and those who ignore warnings or otherwise break the rules can expect significant penalties, including a temporary or permanent ban on sailing in French territorial waters, up to one year’s imprisonment and a €150,000 fine.’ She adds that under the new regulations, over 70 vessels have been fined so far this year alone.
This amalgamation of factors has inevitably put pressure on non-EU vessels in particular, causing yachting owners and charterers to set sail for alternative destinations in the Mediterranean. In contrast to their western counterparts, the waters around Croatia, Turkey and Greece are enjoying a three-year high in superyacht visitation off the back of this shift.
‘The rise of the Eastern Mediterranean is not a new phenomenon, but it is certainly more in focus than ever before. Croatia, Montenegro, Corfu, the Greek Islands, Cyprus and Turkey are all now on the radar – along with stunning scenery and modern infrastructures for yachts, they also offer the perfect gateway to the Suez Canal and key locations in Egypt, Lebanon and Saudi Arabia,’ says Christina.
The island allure of Cyprus has been particularly irresistible to this renewed superyacht clientele, offering a safe yachting haven and gateway to the rest of Europe, the Middle East and Asia. A rich maritime history, enviable yachting infrastructure - including the Limassol and Ayia Napa Marina - and favourable fiscal climate come together to create the unique appeal of Cyprus as a destination of choice for superyacht visitation and registration.
’The Cyprus Government recognises the significance of marine business activities, and has invested significantly in advanced infrastructure and offering the right legal and fiscal ecosystem for those choosing Cyprus,’ Christina adds.
Cyprus-flagged vessels can enjoy advantages such as no tax on the operational or management profits of the yacht, no income tax or dividends received from the management company, no estate duty imposed on inheritance and no income tax imposed on wages of officers or crews.
Finally, Christina tells us, the upsurge in Cyprus’s appeal as a yachting destination has also been reflected in significant refit projects being undertaken in the country. With a highly educated and skilled labour force, Cyprus’s growing superyacht clientele is increasingly taking advantage of the opportunity to undertake extensive marine repairs and maintenance in the country. In addition, with an increasingly complex regulatory framework in the West Mediterranean, along with increasing prices and a widespread penchant for ‘something new’, Cyprus’s rise to the forefront of global superyachting havens shows no sign of slowing down.
"The Cyprus Government recognises the significance of marine business activities, and has invested significantly in advanced infrastructure and offering the right legal and fiscal ecosystem..."