A creditor holds an acknowledgement of debt for 400,000 euros signed by a businessman who has stopped paying. He learns that his debtor owns a yacht moored in Saint-Tropez. Can he arrest it, even though the debt arises from a loan between private individuals?
The principle: a maritime claim
The Brussels Convention of 10 May 1952, to which France is a party, confines the arrest of ships to the maritime claims it lists (Article 2): damage caused by the ship, salvage, charterparties or contracts of carriage, supplies, repairs, crew wages, mortgages. A personal loan is not among them. If the yacht flies the flag of a Contracting State and the creditor is not resident in France, an arrest for a non-maritime debt runs up against the Convention.
The exceptions that open the door to arrest
Two situations change the answer. First, a ship flying the flag of a non-Contracting State may be arrested for a maritime claim or for any other claim for which the law of the State of arrest permits arrest (Article 8(2)). Second, the Convention does not prevent the application of national law where a claimant whose habitual residence or principal place of business is in the flag State arrests a ship in that State (Article 8(4)). The typical case is a yacht under the French flag, arrested in France by a creditor resident in France: domestic law applies.
Under domestic law, the court may authorise the conservatory arrest of a ship as long as the claim appears well founded in principle (Article L. 5114-22 of the French Transport Code), without any requirement that it be maritime.
The flag, a preliminary question
Many yachts based in the Mediterranean are registered in Malta, the Marshall Islands, the Cayman Islands or the United Kingdom, sometimes in the name of a company. The first task is to identify the flag, the registered owner and whether the flag State is a Contracting State. A yacht held by a company separate from the debtor cannot be arrested for the shareholder’s personal debt, unless the company can be shown to be a sham.
The owner’s side
An owner whose yacht is arrested for a non-maritime debt first examines the flag and the residence of the arresting creditor: if the Convention precludes the arrest, release can be sought without waiting for the merits. Failing that, release against security remains available.
What the firm checks first
- The flag and whether the flag State is a Contracting State.
- The registered owner: an individual or a company.
- The creditor’s residence.
- The nature of the claim and the supporting documents.
- The yacht’s location and movements.
For the firm’s services, see Ship arrest and Your yacht has been arrested in a French port.
Further reading
- Wrongful arrest of a ship: obtaining compensation for the detention
- Release from ship arrest: what to require of the P&I club’s letter of undertaking
- Your yacht has been arrested in a French port? What to do
For owners whose yacht is based on the French Riviera, see our page French yacht lawyer on the Riviera.
This analysis is part of the firm’s work in maritime law.
Frequently asked questions
Can a yacht be arrested for a debt that is not maritime?
It depends on the flag and on the creditor’s residence: the 1952 Convention confines arrest to maritime claims, except for ships of non-Contracting States and where national law applies (Article 8(2) and (4)).
Can a yacht under the French flag be arrested over a loan by a creditor resident or established in France?
In that case, national law applies and the arrest may be authorised if the claim appears well founded in principle (Article L. 5114-22 of the Transport Code).
The yacht belongs to a company: can it be arrested for its director’s debt?
Not in principle, since the company is a separate legal person, unless it is proven to be a sham.