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New VAT Regulations for Vessels in France
On 1 January 2016, as announced in the Bulletin Officiel des Finances Publiques-impôts of 12/05/15 which we have had translated for ease of reference, French tax law made it mandatory for all companies wishing to exonerate services to a vessel from VAT in accordance with article 262, II-2, 3, 6 and 7 of the French General Tax Code, to obtain a signed affidavit from the said vessel, which as you will see from this link to our translation, states that the vessel is:
- commercially registered. For non-French-flagged vessels, the term registration means recognition by a foreign authority of a vessel’s assignment to a commercial activity;
- manned by a permanent crew;
- assigned to a commercial activity;
- and that at least 70% of its total navigation takes place outside French territorial waters.
The Marseille-Fos Association of Ship Agents has circulated the new requirements to its Members advising them that they will need to hold on their files original signed affidavits from all vessels requiring any supplies or services in their ports. They should also obtain the ship’s certificate of registry.
In the absence of the affidavits and registry certificates, ship agents (and all other port suppliers) have been advised that they will have to charge VAT.
Sarah Penwarden (sarah.penwarden@budd-pni.com)
Budd Marseille-Fos