A yacht under a non-EU flag can stay eighteen months in the Union under temporary admission, not twenty-four. The regime requires an owner and a user established outside the Union. A charter, a loan to a resident in the owner’s absence, or an overstay gives rise to the customs debt.
A Cayman Islands-flagged yacht enters Antibes in April, spends the summer there, winters at La Ciotat, leaves the following May for Sardinia and returns in July. Nobody has declared anything, nobody has signed anything, and yet the vessel has been under a customs procedure since day one. That procedure has a duration. It has conditions of use. And it has a sanction.
Temporary admission is the mechanism that allows a boat belonging to a person established outside the Union to stay in the customs territory without paying duties or VAT. It is not a right attached to the flag, nor a seasonal tolerance: it is a special procedure within the meaning of the Union Customs Code, with a holder, a time limit and discharge. Owners who are caught have almost never breached it knowingly. They simply did not know they were under it.
What the procedure requires, and who can benefit from it
Article 250 of Regulation (EU) no. 952/2013 defines temporary admission: non-Union goods intended for re-export may be subject to specific use in the customs territory, with total or partial relief from import duty, provided in particular that they undergo no change other than normal depreciation, that they can be identified, and that the holder of the procedure is established outside the customs territory of the Union.
Article 212 of Delegated Regulation (EU) 2015/2446 applies this logic to means of transport, including vessels. Total relief requires three things: that the vessel is registered outside the customs territory in the name of a person established outside that territory, or, if not registered, that it belongs to such a person; that it is used by a person established outside the customs territory; and, where a third party also established outside the Union uses it privately, that the third party is authorised in writing by the holder of the procedure.
The word to remember is establishment, not nationality. A French national settled in Dubai for eight years can perfectly well be the holder of the procedure; a Swiss citizen who has moved his residence to Nice no longer can, whatever the flag of the boat and whatever passport he shows.
Eighteen months, not twenty-four
This is where the most common mistake lies, and it is made by professionals. Article 251 of the Union Customs Code sets a default period of twenty-four months for goods placed under temporary admission. That period does not apply to pleasure yachts. The text’s reservation refers to the Delegated Regulation, whose article 217(e) sets at eighteen months the period for discharge of sea and inland waterway means of transport for private use.
Eighteen months from placement under the procedure. An extension remains possible, but under the strict conditions of article 251(3) of the Code: exceptional circumstances, a justified request, a reasonable period. Wintering is not an exceptional circumstance. Nor is the fact that the yard fell behind on a refit, unless it can be shown that the authorised use could not be achieved within the period.
Discharge, for its part, follows article 215 of the Code: the procedure ends when the goods are placed under another customs procedure, have left the customs territory of the Union, are destroyed or are abandoned to the State. For a yacht, that means one simple thing: leave, or declare for release for free circulation and pay.
The Commission confirmed this reading in its guidance note of 30 April 2026 on pleasure boats, reference TAXUD.A.1.003/EC. It recalls the eighteen-month period, the possibility of an extension in the exceptional circumstances of article 251(3) of the Code, and a rule owners would do well to ponder: a boat used in the customs territory of the Union by a Union resident should normally have the status of Union goods. This is not a doctrinal nuance; it is the grid applied in inspections.
The invisible procedure, or why nobody knows their start date
The difficulty lies in how placement happens. Means of transport may be declared orally, under article 136 of the Delegated Regulation, and failing that they are deemed declared by any other act within the meaning of articles 139 and 141: passing a customs office, using the green channel, or simply entering. The corollary is that no document records the date of entry.
The owner therefore has neither a title nor a written deadline, and discovers the existence of the clock on the day the administration confronts him with its own reconstruction, built on AIS tracks, port receipts, bunkering invoices and yard contracts. At that point the burden does not fall on whoever has the best arguments but on whoever has the best records.
Hence the only recommendation worth making, and it is prosaic: keep on board a dated log of entries into and exits from the customs territory, keep the documents that prove them, and do not rely on the previous captain’s memory. A three-page file avoids a three-year argument.
The typical sequence, where this precaution has not been taken, fits in a few lines, and I have seen it replayed identically in files with no connection to each other: customs notes, during a routine inspection at anchor or a request for information sent to a port, that the vessel already appeared in a database two years earlier; it questions the harbour master’s office, which produces berthing invoices; it cross-checks with public automatic identification system tracks; it reconstructs a continuous presence from a date of its choosing; and it is for the owner, who never declared anything because no text required him to declare in writing, to prove the departures he did not document. The reversal is complete.
An EU resident on board
This is the second trap, and the least understood, because it concerns ordinary social gestures. The principle is that use must be by a person established outside the Union. Article 214 of the Delegated Regulation lists exhaustively the cases in which a person established in the Union still benefits from relief, and none of them corresponds to private use of a yacht.
Article 215(1) opens a narrow gap: a natural person with habitual residence in the customs territory may use the means of transport privately and occasionally, at the request of the holder of the registration, provided the holder is in the customs territory at the time of use. Four cumulative conditions, then, one of which is systematically forgotten: the presence of the holder.
Translated for a Sunday in August. The American owner welcomes Parisian friends on board and goes to sea with them: nothing to report. The same owner, back in New York, leaves the keys to those friends for the weekend: the procedure is breached, and the customs debt arises that day. The difference between the two situations lies in the presence of one man on the quay.
One question remains that the text does not settle and that I flag as such: where the vessel is registered in the name of a company established outside the Union, the condition of presence of the holder of the registration becomes awkward, since a legal person is not anywhere. Should the presence of its legal representative be substituted? The regulation does not say, no published decision says so to my knowledge, and prudence dictates bringing the director over rather than arguing the abstraction.
Charter during temporary admission
The third trap is the most expensive. The procedure described above is that of private use. Article 215(4) of the Delegated Regulation distinguishes private use from commercial use, meaning the carriage of persons for remuneration or of goods for industrial or commercial purposes. Chartering the yacht by the week during its stay under private temporary admission therefore takes the vessel out of the category under which it was placed.
The consequences are twofold and must be kept separate. On the one hand, the applicable period is no longer the same, article 217(b) treating means of transport for commercial use by reference to the time needed for the transport operations. On the other hand, the change of use is a breach of the conditions of the procedure, which gives rise to the customs debt. A shipowner who wants to move from private to commercial use therefore does not just change contract: it takes the vessel out of the customs territory and places it again, or declares it for free circulation.
I add an observation from practice. Summer inspections in the Mediterranean almost never concern the flag or the hull: they concern contracts, bank transfers and online charter listings. A marketplace listing a third-country-flagged yacht with a weekly rate is a public declaration of commercial use.
The Cour de cassation confirmed this on 16 September 2026, in a decision to be published in the Bulletin (Cass. com., 16 September 2026, no. 24-19.047): a yacht registered in the Cayman Islands, operated commercially in Martinique by a French company under cover of temporary admission, was notified of an offence of misuse of the procedure amounting to import without declaration, with import VAT reassessed on the value of the vessel. The same decision recalls, for fuel, that the excise exemption is assessed according to the use made of the vessel by its end user and that hire for pleasure purposes does not qualify.
How the debt arises, and on whom it falls
Article 79 of the Union Customs Code settles the question. The debt arises through non-compliance, either with an obligation relating to temporary admission or customs supervision, or with a condition governing placement under the procedure. It arises at the moment the obligation ceases to be met, which in practice means the nineteenth month, the first day of charter, or the first weekend of the Parisian couple.
The same article designates the debtors, and that is where liability widens: in addition to the person required to comply with the obligation, the debtor includes any person who knew or should reasonably have known that the obligation was not being met and who took part in the failure, and any person who acquired or held the goods knowing, or when they should have known, of the irregularity. The manager, the captain and the over-hasty buyer all fall within that definition.
On the tax side, the mechanism is distinct but parallel. Directive 2006/112/EC provides, in article 71(1), that where goods have been placed since their entry under temporary admission with total relief from duty, the chargeable event and chargeability of VAT only occur when the goods leave that procedure. Article 61 adds that importation is then deemed to take place in the Member State where the goods leave the procedure. Temporary admission therefore does not remove VAT: it defers its chargeability, and an irregular exit triggers it.
The defences that remain
All is not lost once the breach is found. Article 124(1)(h) of the Union Customs Code provides for extinction of a debt arising through non-compliance where the failure had no significant effect on the correct operation of the procedure, did not constitute an attempted deception, and the formalities needed to regularise the situation are completed. Article 103 of the Delegated Regulation gives the list, two items of which directly concern our files: exceeding a time limit by no more than the extension that would have been granted, and spontaneously informing the customs authorities before the debt is notified or an inspection announced.
The second gateway has considerable strategic value. It means that an owner who discovers an overstay has an interest in speaking first. It also means that this reflex only works until the administration’s first request.
A qualification, however. Extinction of the debt does not disarm prosecution, which follows its own rules, and article 124(2) expressly reserves the case of goods seized and then confiscated: the debt is then deemed not extinguished for the purposes of penalties, where national law bases them on the duties or on the existence of the debt. The customs and criminal aspects therefore follow two separate paths.
Seizure, and the new Customs Code
The French side changed this year. Ordinance no. 2026-265 of 8 April 2026 gave the Customs Code a new legislative part, in force since 1 May 2026, without substantive change, with entirely new numbering and published concordance tables. Smuggling is now defined in article L. 512-1, which covers in particular importing goods outside customs offices and landing or loading goods on the coast by manoeuvres designed to escape the administration’s supervision.
For a yacht, the concrete risk is not the fine, it is immobilisation. The vessel is not here the vehicle of the fraud but its object, so protective measures bear on the asset itself, with the consequences one can imagine for a sailing season, a pending sale contract and insurance. The recodified Code makes confiscation conditional on the known owner being given the opportunity to assert its rights, and it keeps the settlement route, which remains, in the great majority of files, the real way out.
A caveat of method that I accept: not all correspondences between the old and new numbering can yet be read with the same ease, and a letter from the administration received today must be checked against the tables before it is discussed.
What the firm does
Before the vessel arrives, we check that the ownership structure is compatible with the procedure, and we set out in black and white who may come on board and on what conditions. We organise traceability of entries and exits, because that is what will decide the file three years later. We deal with changes of use, from private to commercial, choosing the route that avoids creating the debt rather than the one that creates it.
In an inspection, we dispute the placement date retained by the administration, the characterisation of the breach and the identity of the debtor, and we argue, where the conditions are met, that the breach had no significant effect. Where the vessel is immobilised, the first emergency is not legal: it is obtaining release before the season is lost.
For a complete picture, our practical guide Yacht tax and customs: which status to choose, and at what cost? sets out the three statuses side by side, with the documents that prove each one and the cost of leaving it; it can be downloaded free of charge. To have your own situation reviewed, contact the firm.
Further reading: Disputes with a yacht broker: commission, mandate and deposit.
Frequently asked questions
How long can a non-EU flagged yacht stay in the Union?
Eighteen months from its placement under temporary admission, under article 217(e) of Delegated Regulation 2015/2446, and not twenty-four months as the default period of article 251 of the Union Customs Code suggests.
Must the vessel be declared on arrival?
Not necessarily in writing: means of transport can be declared orally, and they are deemed declared by any other act when they enter the customs territory. The lack of a written declaration does not stop the procedure running; it only deprives the owner of proof of its start date.
Can a French resident use the boat?
Only privately and occasionally, at the request of the holder of the registration and provided the holder is in the customs territory of the Union at the time of use, under article 215(1) of the Delegated Regulation. Lending the boat in the owner’s absence falls outside that framework.
Can the yacht be chartered during temporary admission?
No, where the vessel was placed under the procedure for private use. Hire for remuneration is commercial use within the meaning of article 215(4) of the Delegated Regulation: it changes the applicable period and is a breach of the conditions of placement.
What happens if the period is exceeded?
A customs debt arises through non-compliance, under article 79 of the Union Customs Code, and import VAT becomes chargeable, the deferral provided by article 71 of Directive 2006/112/EC ending when the vessel leaves the procedure.
Does leaving the territory reset the clock?
Leaving the customs territory discharges the procedure within the meaning of article 215 of the Union Customs Code, and a new entry opens a new placement. The exit must still be provable, which requires documented calls at a port in a third country, not just a loop offshore.
Can an overstay of a few weeks be put right?
Often, yes. Article 124(1)(h) of the Union Customs Code and article 103 of the Delegated Regulation allow the debt to be extinguished where the breach had no significant effect, in particular where the overstay does not exceed the extension that would have been granted, or where the administration was informed spontaneously before any inspection.
Does wintering suspend the period?
No text provides for it, and I know of no published guidance to that effect. A vessel laid up ashore continues to use up its period. The solutions are an extension, where its conditions are met, or placement under another customs procedure.
Hervé Guyader, avocat at the Paris Bar, doctor of law.
In case of an inspection or detention, the firm can be reached through its contact form.
On the same subject, the commercial regime: commercial yachts, VAT and duty-free fuel; proof of VAT: a yacht without proof of VAT paid; charter: what chartering without commercial status triggers.