Charter Contract Explained
A comprehensive guide to yacht charter agreements — what to expect, what's covered, and how to protect your interests.
Types of Charter Contract
The yacht charter industry uses standardised contracts developed by professional associations to protect both parties.
MYBA Charter Agreement
INDUSTRY STANDARDThe industry standard for Mediterranean and international charters. Used by all MYBA member brokers, this contract provides comprehensive protection for both charterer and owner. It covers payment terms, cancellation policy, APA, insurance, and dispute resolution. Bluebnc Yachting is a MYBA E-Contract subscriber.
IYBA Charter Agreement
INDUSTRY STANDARDThe standard contract for charters in the Americas, particularly the Caribbean and Bahamas. Similar in structure to the MYBA agreement but tailored for US maritime law and Coast Guard regulations. Used by IYBA member brokers.
ECPY Charter Agreement
INDUSTRY STANDARDThe European Committee for Professional Yachting standard, widely used in France and the Western Mediterranean. Provides specific provisions for EU VAT compliance and French maritime law.
Bespoke Contracts
For unusual charter arrangements — multi-week voyages, round-the-world expeditions, or complex corporate events — a bespoke contract may be drafted. These are always reviewed by maritime lawyers on both sides.
Key Contract Terms
Charter Fee
The base cost of hiring the yacht and crew for the agreed period. Quoted in euros for Mediterranean charters and US dollars for Caribbean charters. Payable in two instalments: 50% on signing, 50% four weeks before embarkation.
APA (Advance Provisioning Allowance)
Typically 25–35% of the charter fee, paid before embarkation. Covers fuel, food, beverages, port fees, and other running expenses. Any unused balance is refunded; if exceeded, the difference is settled at the end.
Delivery Fee
If the yacht needs to reposition from its home port to your preferred embarkation point, a delivery fee may apply. This covers fuel, crew overtime, and any port charges during the delivery voyage.
Cancellation Terms
Standard MYBA terms: cancellation more than 6 months before charter — 50% refund of first instalment. Less than 6 months — no refund unless the yacht is re-chartered. Charter cancellation insurance is strongly recommended.
Insurance Requirements
The yacht must carry comprehensive hull and machinery insurance, P&I (Protection & Indemnity) insurance, and passenger liability cover. Charterers are advised to take separate travel and cancellation insurance.
VAT & Tax
VAT applies to charters embarking in EU waters. Rates vary by country: France 20%, Spain 21%, Italy 22%, Greece 24%, Croatia 13%. VAT is typically added on top of the charter fee. Non-EU charters (Caribbean, Bahamas) are generally VAT-free.
Gratuity
Not contractually required but customary. The industry standard is 10–20% of the charter fee, with 15% being the most common. Paid directly to the captain at the end of the charter for distribution among the crew.
Dispute Resolution
MYBA contracts specify London arbitration under English law. IYBA contracts typically specify Florida or New York law. Disputes are rare when using standard industry contracts through reputable brokers.
The Booking Timeline
Initial Inquiry
Day 1
You contact us with your charter requirements. We present a shortlist of suitable yachts.
Yacht Selection
Days 2–7
You review options, possibly arrange a yacht viewing. We negotiate the best terms with the owner.
Contract Issued
Day 7–10
We issue the charter agreement for your review. You may have your own lawyer review it.
Contract Signed + 50% Deposit
Day 10–14
Both parties sign. You pay the first 50% of the charter fee. The yacht is now reserved exclusively for you.
Preference Sheets
6–4 weeks before
You complete detailed preference sheets covering food, wine, activities, dietary requirements, and special requests.
Final Payment + APA
4 weeks before
You pay the remaining 50% of the charter fee plus the APA. The captain begins provisioning.
Embarkation
Charter day
You board the yacht. The captain reviews the itinerary and safety briefing. Your charter begins.
Disembarkation + Settlement
Last day
APA reconciliation, any additional expenses settled, gratuity paid. Captain provides a detailed accounting.
Your Broker's Role
A professional charter broker acts as your advocate throughout the entire process. Here's what we do to protect your interests.