Hong Kong relaxes “permission to navigate” for visiting Pleasure Vessels

Despite the growth of the HNWI population in Asia there is still a relatively weak demand for pleasure vessels; few Asians buy yachts at the moment and few non-Asians send their yacht to Asia.

Why? There are still a lot of barriers to yacht ownership which include: potentially negative cultural perceptions, high effective taxes (ie: 43% in China), immature regulatory environment for yachts, poor equipment quality standards, lack of senior technical personnel and training mechanisms, lack of “real” marinas, lack of service, refit and maintenance facilities…Asians and especially Chinese also have different preferences in terms of layout and use and are afraid of sun and sea. Yachts are mainly used for day charter, as an entertainment venue with card tables and karaoke machines, not for navigation or holidays with family and friends.

There is, however, a willingness of all local Governments to develop yachting activities and implement specific yachting regulations. We see more and more Yacht Shows announced every year, the most renowned being the Singapore Yacht Show. We also saw large Chinese corporate groups recently acquiring European Brands as Ferretti and Sunseeker and several brands like Azimut-Benetti, Perini Navi, Princess have increased their presence in the region. We expect this trend will continue for some time yet.

Indonesia is set to become the biggest market for luxury goods in Southeast Asia and has recently relaxed its regulations on yachting. Malaysia and Singapore are also going well.  Professionals are also hopeful about the yacht markets in Hong Kong, Zhuhai and Shenzhen. Thailand continues to expand its yachting activities.

The area is huge, the potential is there, but one needs to be patient as population and local authorities are still in the learning curve and lots of barriers continue to exist. Associations like APSA* (Asia-Pacific Superyacht Association) are definitively helping in this education process with a clear aim to participate in the take-off of yachting in Asia.

APSA won its last battle! After various discussions, meetings and pressure, Hong Kong Marine Department finally announced on 8 December 2016 that they will relax the rules for visiting yachts and their crew.

So far and according to Section 8 of the Merchant Shipping (Local Vessels)(General) Regulation, Cap. 548F, a Pleasure Vessel from outside Hong Kong was not allowed to navigate in the waters of Hong Kong, except if it had obtained prior permission from the Director of Marine. Only Vessels participating in a racing event, going to a shipyard for repair or changing berthing location were granted such permissions after having submitted an application, producing valid third party risk insurance policy, to cover not less than HK$5,000,000 for operation within the waters of Hong Kong.

Thanks to APSA’s successful lobbying, the possibility of obtaining permission has now been extended to Private Vessels (PV) cruising in the waters of Hong Kong for leisure purposes only, as long as the following conditions are met: 
  • submitting a Pre-Arrival Notification (PAN) for the visiting PV, before entering Hong Kong waters, to notify the Marine Department of arrival and specify the location of the PV’s berth (documentary proof is required to confirm that a berthing space has been secured with a marina or yacht club);
  • appointing a local agent with legal responsibility for the operation and activities of the visiting PV during its stay in Hong Kong;
  • submitting recent photographs of the visiting PV covering the entire port and starboard sides, and showing clearly the name and/or identification mark on the hull of the PV;
  • installing VHF radio and Automatic Identification System on board the visiting PV and ensuring it is in good operation condition and remain turned on while in Hong Kong waters;
  • possessing a valid safety certificate or equivalent, if the visiting PV is of over 150 Gross Tonnage (GT) or carrying more than 60 passengers;
  • possessing valid Pollution Prevention Certificates, if the visiting PV is of 400 GT or above;
  • participating in Vessel Traffic Service of the Marine Department, if the visiting PV is of over 300 GT;
  • complying with specific traffic control measures as expressly stated in the permission, such as a restriction from entering into certain busy waters of Hong Kong;
  • not engaging in chartering or hire business during its stay in the waters of Hong Kong, except for charter or hire agreements made for the visiting PV before its arrival in Hong Kong;
  • possessing a valid third party risk insurance policy, covering not less than HK$5,000,000 for operation within Hong Kong waters;
  • maintaining on board minimum safe manning appropriate to the vessel’s size and equipment and in all cases, not less than two qualified operators; and
  • the on-board operators must hold navigational qualifications issued or recognized by an recognised administration. A copy of such qualifications is to be submitted when applying for a permission to navigate.
It should be noted that the duration of the permission to navigate will be granted on monthly basis, or shorter as the case may be, but in any case, the aggregated period should not be more than 182 days. 
Should a visiting PV remain in Hong Kong waters for more than 182 days out of 365 consecutive days, it must be licensed in accordance with the Merchant Shipping (Local Vessels) (Certification and Licensing) Regulation, Cap. 548D.

To complement the relaxation, the Immigration Department has also implemented measures to facilitate crew members of a visiting PV to enter and remain in Hong Kong.

Non-local crew members, who are visa-free nationals or residents of Macao, may be permitted to remain in Hong Kong for a period of up to 90 days, and crew members who are visa-required nationals and residents of the Mainland or Taiwan, can remain until the expiration date of the visit visa / exit endorsement / entry permit, or, and this is new, until the PV departs Hong Kong, whichever is the earlier, subject to the condition that they are engaged solely in the operation of the PV at all times and the normal immigration requirements being met.

Let’s hope this relaxation will be followed by many others in Asia.

Do not forget that there are still lots of battles to win out there and Associations need members…
*APSA is the It is a non-profit association incorporated in Hong Kong in April 2011.The primary objective of the Association is to promote the Asia-Pacific region to the global superyacht community both as the world’s “most exciting cruising destination” and as a superyacht construction, refit and services location.  APSA is working towards attracting more superyachts and helping the industry to overcome any challenges which may arise.

APSA also aims to work with governments to make access easier for visiting yachts, and help to maintain high standards and procedures.  APSA is financed through membership, sponsorship, ad revenues and donations. 
For more information contact Janet Xanthopoulos, Yacht Ownership & Administration Department Manager, Rosemont Yacht Services  at  j.xanthopoulos@rosemont-yacht.com