No, it is not a new type of tender or superyacht toy. It’s far more serious, even mundane. A Special Purpose Vehicle is an arrangement that is designed as a legal and fiscal envelope for an asset, or collections of assets. This is often the case of a superyacht which will be incorporated into an SPV and managed by corporate service providers.
Who is the Owner?
The Owner of the asset is not actually the owner of the asset which in theory is owned by the SPV. In fact, an SPV may be designed to preserve the anonymity of the ‘owner’ whose identity may be concealed behind a façade of an SPV and possibly trusts.
This is less a deception but more a measure of personal security and means of minimizing personal liability.
While the yacht itself can be registered to a flag state such as the Cayman Islands or the Marshal Islands, the Corporate Service Providers can be based elsewhere, an arrangement which can be useful if VAT registration is required for a commercial yacht.
The Yacht Management Company is almost always located elsewhere, managing the operational aspects on behalf of the CSPs who in turn are responsible for the SPV. In the case of huge estate, a family office may also be involved.
When a yacht is sold, the SPV is usually dissolved. The sale itself has to be signed off at a board level, which means the owner will often have to get the permission of the Corporate Service Providers to sell an asset he bought in the first place. There may be a mortgage on the SPV to be redeemed before a sale can proceed.
In summary, an SPV has these characteristics:
• It incorporates a very high-value asset, often built overseas and owned by an SPV domiciled in a third jurisdiction
• Offers a vehicle for VAT and local tax affairs if commercially chartered in the EU
• Allows the owner to be removed from the operational and legal complexities of yacht ownership