I just agreed to buy a boat in Italy. Now what do I do?

[petem]

Making interesting reading. I'm currently looking at (ie, thinking about) buying my next boat in the EU as an "EU-VAT-paid and keep it there" affair. The experience described by @Dogone and the caveats posted by my learned colleagues make me wonder if that's entirely as simple as it seemed on paper ....

It can be simple. My strong preference is to buy from brokers who represent UK brands. Ideally from a British owner.

If paperwork is important then don't bother leaving the house to view a boat until you've seen evidence that it exists. Alternatively, buy privately from a Brit though a FB Owners Group.

 

[Sticky Fingers]

Agreed. Be a year or two yet but good advice.

 

[DavidJ]

…. Alternatively, buy privately from a Brit though a FB Owners Group.

Pete
Can I trouble you to explain what one of these facebook groups is. Do I join one or have to make one?
cheers

 

[petem]

Pete
Can I trouble you to explain what one of these facebook groups is. Do I join one or have to make one?
cheers

This would be your best bet (it's got 2,800 members)...

Sealine owners club | Facebook

It's a Private Group so you'll have to be approved.

 

[DavidJ]

This would be your best bet (it's got 2,800 members)...

Sealine owners club | Facebook

It's a Private Group so you'll have to be approved.

Thanks Pete

 

[jon and michie]

ask @Whitelighter - He will tell you the pitfalls

 

[Hooligan]

Apologies if already covered and congratulations on how far you have got. I am neither Italian nor a lawyer but for me there would be two critical things. First as others have said a really good lawyer who can navigate between local practices and international practices. As on all things title is critical. Secondly I would not use an Italian surveyor. Not because they are any less capable than a U.K. surveyor but simply because the U.K. guy is likely to “better” represent your interests so as to speak. I have personal experience as to what “happens” locally in Italy re surveying. The cost of getting a U.K. surveyor is minimal vs the cost of the purchase. Good luck and tell us how it ends up.

Ps I am not sure if I would pay any deposit personally although it sounds as if you have not. You seem to have an agreement to buy which is great. But at the end of the day if he walks because someone offers higher or any other reason, or you walk because the survey is bad or you find a better boat, then so be it.

 

[westernman]

Apologies if already covered and congratulations on how far you have got. I am neither Italian nor a lawyer but for me there would be two critical things. First as others have said a really good lawyer who can navigate between local practices and international practices. As on all things title is critical. Secondly I would not use an Italian surveyor. Not because they are any less capable than a U.K. surveyor but simply because the U.K. guy is likely to “better” represent your interests so as to speak. I have personal experience as to what “happens” locally in Italy re surveying. The cost of getting a U.K. surveyor is minimal vs the cost of the purchase. Good luck and tell us how it ends up.

Ps I am not sure if I would pay any deposit personally although it sounds as if you have not. You seem to have an agreement to buy which is great. But at the end of the day if he walks because someone offers higher or any other reason, or you walk because the survey is bad or you find a better boat, then so be it.

I don't know if Italy is the same, but in general in most European countries there is a pre-sale contract and that usually means a deposit (typically 10%) is paid (to an escrow account).

The pre-sale contract includes all the conditions for the sale to proceed, such as satisfactory survey etc. And the conditions under which you can withdraw from the purchase (and get your deposit back).

The conditions you put in the pre-sale agreement are critical.

Once a pre-sale agreement has been signed, the seller cannot sell to anyone else. Until then he can.

 

[Dogone]

I don't think we are at cross purposes, and if you think it's just a matter of semantic, well, it isn't.
As I said in my first post, my question about if and how what you call a deal was formalized is just the first basic point that I was trying to address, but there's much more that ought to be considered.
Not to mention that I believe to be the only Italian contributing to this thread so far, and I have good reasons to tell that I know the local practices and regulations on this matter like the back of my hand.

But... Hey-ho!
Sorry if you found my posts annoying, and good luck for a satisfactory completion of your "deal" - whatever that means.
From my part, I'll just keep some popcorn ready for following in the background the next steps.

Lost in translation... Never mind. Please chip in and as an Italian your posts are especially welcome.

 

[Dogone]

We are often at daggers but while I have attempted to inflate an air bag for the falling stunt man in a movie fall , you have left the guy to splat on concrete.
I would like to hear the outcome btw .Having successfully navigated all this .
I won’t post any more just listen .

You too, please don't hold back.

 

[Sticky Fingers]

You too, please don't hold back.

You may regret suggesting that

 

[Dogone]

Apologies if already covered and congratulations on how far you have got. I am neither Italian nor a lawyer but for me there would be two critical things. First as others have said a really good lawyer who can navigate between local practices and international practices. As on all things title is critical. Secondly I would not use an Italian surveyor. Not because they are any less capable than a U.K. surveyor but simply because the U.K. guy is likely to “better” represent your interests so as to speak. I have personal experience as to what “happens” locally in Italy re surveying. The cost of getting a U.K. surveyor is minimal vs the cost of the purchase. Good luck and tell us how it ends up.

Ps I am not sure if I would pay any deposit personally although it sounds as if you have not. You seem to have an agreement to buy which is great. But at the end of the day if he walks because someone offers higher or any other reason, or you walk because the survey is bad or you find a better boat, then so be it.

I don't know if Italy is the same, but in general in most European countries there is a pre-sale contract and that usually means a deposit (typically 10%) is paid (to an escrow account).

The pre-sale contract includes all the conditions for the sale to proceed, such as satisfactory survey etc. And the conditions under which you can withdraw from the purchase (and get your deposit back).

The conditions you put in the pre-sale agreement are critical.

Once a pre-sale agreement has been signed, the seller cannot sell to anyone else. Until then he can.

I haven't paid a deposit yet or signed the contract because there are things I asked for as a condition that have not yet been delivered: title papers and documentation of repairs are the main things. Once these are received a lawyer will be appointed and the contract signed. They are pressing me to sign now before delivery of this information. That makes no sense. "Don-a-t-a worry, don-a-t-a worry".

Agreed, a non-local surveyor would be ideal. I don't want any existing relationships to get in the way of getting represented properly.

I have got an acceptance of the MYBA MoA and as mentioned it does tie up both the buyer and seller pretty tightly, so detail does needs agreeing first.

 

[westernman]

I haven't paid a deposit yet or signed the contract because there are things I asked for as a condition that have not yet been delivered: title papers and documentation of repairs are the main things. Once these are received a lawyer will be appointed and the contract signed. They are pressing me to sign now before delivery of this information. That makes no sense. "Don-a-t-a worry, don-a-t-a worry".

Agreed, a non-local surveyor would be ideal. I don't want any existing relationships to get in the way of getting represented properly.

I have got an acceptance of the MYBA MoA and as mentioned it does tie up both the buyer and seller pretty tightly, so detail does needs agreeing first.

You can add all these things to the pre-sale contract. And you should do anyway. I.e. you have the right to withdraw and get your deposit back if anything is not satisfactory (be careful to define what that means).

 

[DAW]

I have got an acceptance of the MYBA MoA and as mentioned it does tie up both the buyer and seller pretty tightly, so detail does needs agreeing first.

That's very good news!

As I mentioned in an earlier post, there are some clauses in the MYBA agreement that you or your lawyer should seek to amend and also some additions to make. I usually add the following as addenda to the MYBA:

Description of any Seller's works to be performed before completion
Complete list of original documents to be delivered by Seller at completion (with copies/drafts prior to signing where possible)
Specification and inventory, detailing any modifications and/or major items of equipment that should remain onboard
Proforma letter of confirmation that there have been no groundings, collisions, or significant water ingress
Proforma letter of guarantee and indemnity
Protocol of completion, delivery and acceptance
Document containing any other amendments to the MYBA

In the last document, I usually refer to deletion of provisions in the MYBA and their replacement with alternative language. The most significant changes are to clauses 26 to 29 which deal with Sea Trial (26), Condition Survey (27), Acceptance (28) and Cancellation (29). I don't like some of the MYBA language in these sections, which as I mentioned earlier gives very little time for consideration of any sea trail or survey findings. For example, the survey is deemed to be completed once the physical inspection is over and before you see any written report or summary of findings from your surveyor, and the definition of defect is limited to items which affect sea worthiness when it should include anything which affects the normal functioning of the vessel or any of its material systems. If you're not careful you can find that you have to complete a purchase even if you find something that you're not happy with.

 

[Dogone]

That's very good news!

As I mentioned in an earlier post, there are some clauses in the MYBA agreement that you or your lawyer should seek to amend and also some additions to make. I usually add the following as addenda to the MYBA:

Description of any Seller's works to be performed before completion
Complete list of original documents to be delivered by Seller at completion (with copies/drafts prior to signing where possible)
Specification and inventory, detailing any modifications and/or major items of equipment that should remain onboard
Proforma letter of confirmation that there have been no groundings, collisions, or significant water ingress
Proforma letter of guarantee and indemnity
Protocol of completion, delivery and acceptance
Document containing any other amendments to the MYBA

In the last document, I usually refer to deletion of provisions in the MYBA and their replacement with alternative language. The most significant changes are to clauses 26 to 29 which deal with Sea Trial (26), Condition Survey (27), Acceptance (28) and Cancellation (29). I don't like some of the MYBA language in these sections, which as I mentioned earlier gives very little time for consideration of any sea trail or survey findings. For example, the survey is deemed to be completed once the physical inspection is over and before you see any written report or summary of findings from your surveyor, and the definition of defect is limited to items which affect sea worthiness when it should include anything which affects the normal functioning of the vessel or any of its material systems. If you're not careful you can find that you have to complete a purchase even if you find something that you're not happy with.

I agree and thanks for the good advice. I will add these to the list.

One example of a problem I am having (and there are bigger issues) is there is major damage to glazing and it will be an expensive repair. It was disclosed to me and the broker insisted he didn't want to negotiate on that now. A quote is for about €30,000. He said it would be reported in the survey and the owner asked to fix it or compensate for it with a deduction. The problem is the MoA disregards all defects known prior to survey (including this one therefore) and to any defects that don't affect 'operational integrity' or 'seaworthiness'. (arguable to apply to this one). So without it being itemised I stand to be liable for its costs. It is frustrating that they think it fair to demand I sign before issues like this are settled, when by signing I can't get the redress promised. Another reason I have to hold off.

The MoA doesn't allow you to seek compensation for unacceptably worn or damaged items that need replacing and which may have been missed at my inspection, but which still function. Similarly structural or major repairs that may be revealed in the survey, but not previously disclosed must be disregarded as a reason for compensation or cancellation. These things need correcting.

I get a lot more protection if I do the the surveys before the sea trial, which I will do as the boat is fortunately on the hard now. The sea trial allows me to reject the vessel on purely subjective grounds, so if I can't agree on the results of the surveys then I still have a get out of jail card.

 

[PowerYachtBlog]

I think the Maltese registry is quite expensive for a normal yacht.
If you are into 8 figure territory for the purchase price, then may be Maltese registration is worthwhile.

If you are not an EU citizen you will need a Maltese or EU company to own it. This has additional costs and of course requires tax declarations every year (even it contains 0 everywhere).

Find out exactly what the costs are. I also think it has to be renewed every year.

That is correct I presume for a non resident.

 

[DAW]

I agree and thanks for the good advice. I will add these to the list.

One example of a problem I am having (and there are bigger issues) is there is major damage to glazing and it will be an expensive repair. It was disclosed to me and the broker insisted he didn't want to negotiate on that now. A quote is for about €30,000. He said it would be reported in the survey and the owner asked to fix it or compensate for it with a deduction. The problem is the MoA disregards all defects known prior to survey (including this one therefore) and to any defects that don't affect 'operational integrity' or 'seaworthiness'. (arguable to apply to this one). So without it being itemised I stand to be liable for its costs. It is frustrating that they think it fair to demand I sign before issues like this are settled, when by signing I can't get the redress promised. Another reason I have to hold off.

The MoA doesn't allow you to seek compensation for unacceptably worn or damaged items that need replacing and which may have been missed at my inspection, but which still function. Similarly structural or major repairs that may be revealed in the survey, but not previously disclosed must be disregarded as a reason for compensation or cancellation. These things need correcting.

I get a lot more protection if I do the the surveys before the sea trial, which I will do as the boat is fortunately on the hard now. The sea trial allows me to reject the vessel on purely subjective grounds, so if I can't agree on the results of the surveys then I still have a get out of jail card.

The points you raise above are good examples of why I don’t like the MYBA agreement In its standard form.

Repair of the damage to the glazing and the other matters you refer to can be itemised in the schedule of Seller’s works to be done before completion. You can be as vague or specific as you like, but you should always insist that are at least “to Buyer’s reasonable satisfaction”.

With regards to worn or damaged items, you can try to add them to the list of Seller’s works if you know about them now. Alternatively, suggest an amendment to the wording for the condition survey which states that all of the vessels systems have to be in normal working order and anything that affects the vessels integrity (e.g. structural damage or major repairs) falls within the definition of “defect”. Your lawyer should be able to help with this.

With regards to survey, etc. the MYBA contemplates a sea trial followed by a condition survey. In practice the two are usually done on the same day. The boat should be lifted for inspection and to clean the bottom and stern gear prior to the sea trial and the surveyor normally does his inspection of the exterior at the same time. I always amend the MYBA to state that the condition survey is not complete until the surveyor has delivered a written report, and I increase the time allowed to form a conclusion and deliver a verdict on the sea trial. In that way you have the surveyor’s comments on performance, handling, etc. from the sea trial in writing before you formally accept the sea trial was satisfactory.

 

[DavidJ]

Where can I get a copy of this MYBA that everyone seems to know about. Could be very useful for me.

 

[Alicatt]

Where can I get a copy of this MYBA that everyone seems to know about. Could be very useful for me.

Would this be it?
MYBA E-CONTRACT: Electronic MYBA CONTRACT from MYBA ASSOCIATION Homepage

 

[DavidJ]

Would this be it?
MYBA E-CONTRACT: Electronic MYBA CONTRACT from MYBA ASSOCIATION Homepage

Thank @Alicatt
The site has been updated from your link to
MYBA Portal

However it seems you have to be in the trade to apply for membership. I was rather hoping to download the contract for free or make a contribution