Charter yachts, clearing houses and charter yacht brokers operate under some very specific rules. Here, courtesy of the Virgin Islands Charteryacht League (www.vicl.org) are the Industry Policies and Procedures. These are the standards under which Flagship operates.
Owner/Captain Bookings and Holds – Owners/Captain’s are in control of the yacht calendar. You must place dates for haul out, self-booking, owner time, travel time, yacht show, maintenance, crew vacation on either a hold or block. If you request a hold, we will email you if an inquiry from a broker comes in. You can decide if you wish to release the time. If you place a Block on the time, you will not be contacted regarding inquiry. Please supply the dates of either the hold or the block and the reason for the hold or block along with beginning and ending ports.
If a broker already has a hold on the dates you are wishing to block/hold, you must allow the broker a reasonable amount of time to book those dates as he/she has already offered your yacht in good faith. Four working days is normally sufficient.
If you do not block or place holds on dates which you do not wish to charter, these days will show open on your calendar and will be offered to brokers. Flagship will check with you for last minute bookings (within two weeks) to make sure your crew hasn’t gotten some “project” going on. If Flagship, in good faith, books a charter for dates showing open on your calendar you are expected to fulfill the charter. If you cannot fulfill the charter you are expected to pay the broker’s commission since it is already and earned fee.
Since most bookings come from brokers, you are strongly encouraged to work with them as much as possible.
Rules & Policies
- Commissions: Although there are no set commission rates, accepted industry standards are 15% of the charter fee and are earned at the time of booking. Brokers will deduct the commission amount from the funds sent to Flagship. If a travel agent is involved, a 20% commission is standard. Some yachts are offering a standard 20% commission to a broker not involving a travel agent. This is your choice.
- Cancellation/Refund Policy: Contracts between charterer and yacht, which are prepared by the broker (note: read all contracts carefully) should spell out the conditions for refunds for deposit monies on cancellation. If they do not, following is the industry-accepted policy for deposit refunds:
- If the client cancels – a charter deposit is considered an “earned fee” by the yacht because the charter dates have been taken off the market and reserved for the client’s exclusive use. If the client cancels and the time is not rebooked, the yacht is entitled to keep the deposit. If some of the dates are rebooked, a prorated refund will be issued. Since the broker receives the entire commission upon booking, he/she will owe half of that commission to the yacht should the client cancel. This will mean both the yacht and the broker earn half fees. If a travel agent is involved and has taken commission, it is the broker’s responsibility to obtain half of that commission for the yacht.
- If the yacht cancels – Flagship will make every effort to find a suitable replacement. However, if a replacement cannot be found or if the client does not wish to accept the substitute vessel, the deposit will be refunded. Regardless of whether or not the client charters another vessel, it is the yacht’s responsibility to pay the broker his/her full commission, which was rightfully earned when the charter was sold. However, just as brokers will frequently ask yachts to allow a deposit to apply to a rebooking when the client has to cancel for a good reason it is hoped that if a yacht has to cancel due to extenuating circumstances, a mutually acceptable agreement regarding the commission can be reached.
- Mechanical breakdown – in the event of a mechanical breakdown, a yacht has a 24 hour grace to repair the yacht or cancel the charter (for refund policy – see above).
- Your rates: Rates for charters in the Caribbean are based on a seven-night charter. When referring to a charter, the terms “day” and “night” may be used interchangeably, but both refer to a 24-hour period running from noon to noon. In an effort to minimize the confusion which would be caused by frequent or random rates changes, clearinghouses restrict rate increases to specified time – February 1, May 1, August 1 and November 1. Rates are for a “season”. Winter season runs from December 15 to May 14. Summer season is May 15 to December 14. Holiday rates are often at a higher rate (plus 10 –15%).
- Bar: usually included in the Virgin Islands but may be extra on down island charters
- Cruising Taxes: these are paid to the BVI government and are currently $4.00 per person per day, $5.00 per person departure tax plus a per cruise fee of $40 – $50 depending on the length of your vessel.
- Fishing License: if your client’s wish to fish in the BVI they must obtain a fishing license. The license is currently $45.00. DO NOT FISH IN THE BVI without this license! Applications can be retrieved on line at: http://www.nwmangum.com/documents/BVIFishingApp.pdf
- Deadhead fees: fee to reposition a yacht for a pick up in a location other than its home base.
- Diving: may or may not be included in a yacht’s rates. Inquire regarding costs for rendezvous diving (a dive boat will pick up and drop off your guests at a predetermined location)
- Dockage: if requested by guests, it is normally at their expense
- Fuel: may be extra on large power yachts and sports fishing vessels. In late 2005 fuel surcharges were added to many smaller power yachts as the fuel costs escalated.
When Do You Receive Your Money?
Deposits are held in escrow until ten days prior to the charter date. At this time you will receive a check of the deposit less commission. Final payments, if received in advance, will be released the day of the charter. If not received by Flagship, final payments will be paid in cash or travelers checks upon boarding. Cruising taxes, passenger fees, fishing licenses, etc. are normally paid in cash during the charter.