Madeira Vessel Registry: Ensuring Compliance and Benefits

Home | Shipping | Madeira Vessel Registry: Ensuring Compliance and Benefits

Madeira Vessel Registry: Ensuring Compliance and Benefits

by | Wednesday, 26 June 2024 | Shipping

Madeira Vessel Registry: Ensuring Compliance and Benefits

Introduction

In today’s dynamic maritime landscape, shipowners and operators face a myriad of considerations when selecting the optimal vessel registry. Among the prominent options, the Madeira International Shipping Register (MAR) has emerged as a compelling choice, offering a robust regulatory framework, attractive tax incentives, and a commitment to safety and compliance. This comprehensive article delves into the key aspects of the MAR, highlighting its advantages and demonstrating why it has become a preferred destination for vessel registration.

Establishing MAR’s Credibility

The Madeira International Shipping Register (MAR) was established to provide a credible alternative to other international vessel registries. Adhering to the highest quality and safety standards, MAR has meticulously maintained these principles within an attractive tax environment designed to encourage inward investment in the island of Madeira. This strategic approach has earned MAR a reputation as a reputable and secure EU registry, commanding the trust of industry leaders and regulatory bodies alike.

Whitelisting and Qualship 21 Recognition

A significant milestone in MAR’s journey was its inclusion on the “White List” of both the Paris MOU and the Tokyo MOU. This prestigious designation is a testament to the exceptional standards upheld by the registry, demonstrating its commitment to safety, environmental protection, and compliance with international maritime regulations. Furthermore, vessels under the Portuguese flag, including those registered with MAR, have been recognized by the United States’ Qualship 21 Index, which acknowledges the exceptional quality of vessel registries.

Collaboration with Classification Societies

MAR has forged strategic partnerships with leading classification societies to enhance its service offering further. The registry has authorised the Korean Register (KR), a member of the International Association of Classification Societies (IACS), to deliver statutory services on behalf of the Portuguese flag. This collaboration enables KR to conduct surveys, audits, and issue certificates to Portuguese-flagged ships, including those registered with MAR, ensuring full compliance with the most stringent international regulations.

Advantages of Registering with MAR vessel registry

The Madeira International Shipping Register offers numerous advantages that make it an attractive choice for shipowners and operators. These benefits span tax incentives, operational flexibility, and regulatory compliance, making MAR a compelling option in the global maritime landscape.

Tax Incentives

One of the primary draws of registering a vessel with MAR is the favourable tax environment it offers. Shipping companies licensed to operate within the Madeira International Business Centre (MIBC) framework benefit from a corporate income tax rate of just 5%, a rate that is guaranteed until 2027. Additionally, these companies enjoy automatic VAT registration and access to Portugal’s extensive double taxation treaty network, further enhancing their financial efficiency.

Ownership and Crew Flexibility

The Madeira International Shipping Register boasts a flexible approach to vessel ownership and crew composition. There are no nationality requirements for ship owners, and they are not obliged to have their headquarters in Madeira; instead, they can appoint a local legal representative with adequate powers to fulfil the registry’s requirements. Furthermore, the crew composition guidelines are designed to promote safety and quality of life, with the captain and 30% of the crew required to be nationals of Europe or PALOP (Portuguese-speaking African) countries. This flexible approach allows for a diverse and multinational crew catering to the needs of shipowners.

Mortgage and Temporary Registration

The Madeira International Shipping Register offers a flexible mortgage system, allowing the mortgagor and mortgagee to choose the legal system of a particular country to govern the mortgage terms. This feature enhances the appeal of MAR for international shipowners and financiers. Additionally, the registry permits temporary registration, enabling vessels to be registered temporarily (“in” and “out”) under the Portuguese flag, further adding to the operational flexibility it provides.

Crew Taxation and Social Security

Crew members of vessels registered with MAR enjoy a unique tax and social security advantage. Their salaries are exempt from income tax in Portugal, and they are not required to contribute to the Portuguese social security regime as long as they are covered by an alternative, public or private system. This favourable treatment of crew members is a significant draw for shipowners and operators.

Specialized Services for Yachts

The Madeira International Shipping Register caters not only to commercial vessels but also to the needs of yacht owners and operators. Vessels registered with MAR, including yachts, benefit from full access to sailing within EU waters, a crucial consideration for those seeking to operate in the European maritime domain.

VAT Exemption and Flexible Crew Composition

Yacht owners registered with MAR can enjoy VAT exemption on the acquisition or importation of their vessels and on the purchase of fuel and maintenance or repair operations, provided the yacht has a commercial activity at high sea. Additionally, there are no limitations on the nationality of the crew for commercial yachts registered with the Madeira registry, further enhancing the flexibility and appeal for yacht owners.

Flexible Social Security System

The Madeira International Shipping Register offers yacht crews a flexible social security system. Crew members and their respective employers are not obliged to pay social security taxes within the normal Portuguese system, allowing for the adoption of voluntary insurance or social security arrangements that better suit their needs.

Establishing a Madeira Shipping Company

Beyond the advantages of vessel registration, the Madeira International Shipping Register provides an attractive option for shipowners and operators to establish their corporate presence within the Madeira International Business Centre (MIBC) framework.

Tax Incentives for Shipping Companies

Shipping companies licensed to operate under the MIBC regime benefit from a highly competitive special tax regime. This includes a reduced corporate income tax rate of 5%, guaranteed until 2027, as well as an exemption from withholding tax on dividends paid to shareholders as long as they are not residents of a blacklisted jurisdiction. Additionally, the salaries of crew members of vessels registered with MAR are exempt from taxation in Portugal.

Comprehensive Corporate Services

Madeira Management, with its team of highly qualified and multilingual professionals, offers a complete range of business and private consulting services to companies and individuals investing in or doing business through Portugal. From vessel registration and reflagging to establishing corporate owning or operational structures, Madeira Management provides comprehensive support to ensure a seamless experience for its clients.

Navigating the Regulatory Landscape of Vessel Registry

The Madeira International Shipping Register operates within a robust regulatory framework, ensuring compliance with international maritime conventions and treaties ratified by Portugal. This commitment to upholding the highest safety and environmental protection standards is a hallmark of MAR’s operations.

Compliance with International Conventions

All vessels registered under the Madeira International Shipping Register fly the Portuguese flag and are subject to the international treaties and conventions entered into by Portugal. This alignment with global regulatory standards contributes to including MAR on the prestigious Paris MOU and Tokyo MOU White Lists, solidifying its reputation as a reputable and compliant registry.

Recognized Classification Societies

The Madeira International Shipping Register recognizes eight International Classification Societies, allowing shipowners and operators to delegate certain functions to these respected organizations. This collaboration streamlines the registration process and allows shipowners to work with their preferred classification society, ensuring seamless compliance with SOLAS, MARPOL, ITC, ILL, and MLC regulations.

Cabotage Rights and EU Access

A significant advantage of registering a vessel with the Madeira International Shipping Register is the ability to engage in cabotage, or coastal shipping, within the European Union. As vessels under the Portuguese flag, MAR-registered ships can freely navigate and transport goods or passengers between EU member states, providing shipowners with unrestricted access to the lucrative European maritime market.

Leveraging the Portuguese Flag and Vessel Registry

The Portuguese flag carried by MAR-registered vessels grants them full access to EU cabotage, a critical consideration for ship owners and operators seeking to capitalize on the opportunities within the European maritime landscape. This advantage, coupled with the registry’s high technical standards and safety protocols, makes MAR an attractive choice for those seeking to expand their operations within the EU.

Conclusion

The Madeira International Shipping Register (MAR) has emerged as a compelling choice for ship owners and operators seeking a reliable, compliant, and tax-efficient vessel registry. With its robust regulatory framework, attractive tax incentives, and operational flexibility, MAR offers a comprehensive suite of benefits that cater to the maritime industry’s diverse needs.

By leveraging the Portuguese vessel registry, maintaining the highest safety and compliance standards, and providing a supportive ecosystem for shipping companies, the Madeira International Shipping Register has solidified its position as a preferred destination for vessel registration. As the industry continues to evolve, MAR’s commitment to innovation, customer service, and regulatory excellence positions it as a trusted partner for shipowners navigating the global maritime landscape.

Remember, this article provides a comprehensive overview. Still, for more detailed information, we recommend seeking the expertise of our team at MCS, who are here to support you throughout your business journey.

Other Articles

Is the NHR program to come back?

Is the NHR program to come back?

The government intends to restore the Non-Habitual Resident (NHR) regime for both self-employed and paid workers. According to claims made by the Finance Minister to the Financial Times, anyone who stays in Portugal for at least 183 days and establishes tax residence...

Our Newsletter

Join our mailing list and get the latest information about incorporating in Madeira (Portugal), Expat Services and Vessel Registration.

Need Help?

Should you have any questions about us and our services, please do not hesitate to contact us.

Contact Us

Other Articles

Is the NHR program to come back?

Is the NHR program to come back?

The government intends to restore the Non-Habitual Resident (NHR) regime for both self-employed and paid workers. According to claims made by the Finance Minister to the Financial Times, anyone who stays in Portugal for at least 183 days and establishes tax residence...

Want to talk with us?

Should you have any questions about us and our services, please do not hesitate to contact us.