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New charter rules in the USVI

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In December, U.S. President Obama signed into law the Howard Coble Coast Guard and Maritime Transportation Act of 2014. This legislation contained multiple appropriations and various new regulations.

For the U.S. Virgin Islands, there was a long-awaited regulatory amendment that increased the maximum number of passengers that charter yachts can carry on board.

In 1993, the U.S. Congress amended the Passenger Vessel Safety Act and placed a six-passenger limit on vessels measuring less than 100 gross tons. Referred to as the “6-pack” restriction, this amendment had an unintentional but especially negative impact on the crewed charter business in the U.S. Virgin Islands. It was estimated that about $70 million-$100 million were lost in annual revenue.

Some of the fleet of charter yachts in St. Thomas this winter. New rules allowing up to 12 paying guests are likely to encourage some yachts to base in the USVI again. PHOTO/DEAN BARNES

Some of the fleet of charter yachts in St. Thomas this winter. New rules allowing up to 12 paying guests are likely to encourage some yachts to base in the USVI again. PHOTO/DEAN BARNES

When the act was signed into law, the affected charter yachts moved their businesses and bases of operation to the neighboring British Virgin Islands (BVIs). In contrast, the BVIs follow the international regulations that permit up to 12 guests on board a charter yacht.

Now, with the passage of the Coble Act, vessels of 80 feet (24m) and less operating in the U.S. Virgin Islands will be permitted to carry up to 12 passengers. In order to use this new privilege, a charter yacht must be certified to one of the following safety standards, as quoted from the Act:

  • the Code of Practice for the Safety of Small Commercial Motor Vessels (commonly referred to as the Yellow Code), as published by the UK Maritime and Coastguard Agency (MCA) and in effect on Jan. 1, 2014; or
  • the Code of Practice for the Safety of Small Commercial Sailing Vessels (commonly referred to as the Blue Code), as published by the UK Maritime and Coastguard Agency (MCA) and in effect on such date.

These yacht safety codes are well known within the yachting industry. They are collectively referenced through the Marine Guidance Note (MGN) 280. The United Kingdom, registry through its Red Ensign group, implements this legislation. Members of this group include the flag of the United Kingdom and it dependencies. The dependencies are Anguilla, Bermuda, the British Virgin Islands, the Cayman Islands, Falkland Islands, Gibraltar, Guernsey, Isle of Man, Jersey, Montserrat, St. Helena, and the Turks and Caicos Islands.

The Small Commercial Vessel Code is also adopted and implemented by several other flag administrations that are members of the British Commonwealth, but not subject to the oversight of the MCA. These flags include Antigua and Barbuda, the Bahamas, Barbados, Jamaica, and St. Kitts and Nevis.

For commercial yachts registered with one of the above flags and certified to MGN-280, it is expected that they will meet the U.S. regulations outlined in the Coble Act. This certification will permit the yacht to charter in both the U.S. Virgin Islands and the British Virgin Islands.

Understandably, reactions to this new amendment are not being met with open arms in the BVIs. Some local charter managers expressed strong optimism, but with the usual amount of caution. It is foreseen that the changes will benefit the economies of both territories in the Virgin Islands region.

However, others have expressed strong concern that make basing charter operations in the U.S. Virgin Islands much more favorable. These advantages include improved travel services, ready availability of provisions, and taxes.

Also, as to be expected with any new law, its simple signature into existence does not mean an instantaneous understanding on its proper enforcement. The U.S. Coast Guard is the primary agency responsible for this compliance. The agency is being tasked to verify a foreign safety code that has no counterpart under U.S. law.

The Howard Coble Coast Guard and Maritime Transportation Act of 2014 was named in honor of Howard Coble, a Republican congressman from North Carolina. Rep. Coble retired in January after 30 years in the U.S. House of Representatives. He was the only current member of Congress to have served in the U.S. Coast Guard. The Coble Act provides more than $17 billion for operations during the next two fiscal years.

Owners, captains and crew must remember that the U.S. Coast Guard is responsible for ensuring safety at sea for all vessels under the U.S. flag, plus foreign-flagged vessels operating in U.S. waters. Simply presenting a Certificate of Compliance will not guarantee acceptance at face value. Additional inspections as part of the port state control program may be warranted.

Patience and understanding are the keys to making this a successful transition.

Capt. Jake DesVergers is chief surveyor for International Yacht Bureau (IYB), an organization that provides flag-state inspection services to yachts on behalf of several administrations. A deck officer graduate of the U.S. Merchant Marine Academy at Kings Point, he previously sailed as master on merchant ships, acted as designated person for a shipping company, and served as regional manager for an international classification society. Contact him at +1 954-596-2728 or www.yachtbureau.org. Comments on this column are welcome at editorial@the-triton.com.

 

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