The maritime sector, specifically the activity related to recreational boating, has experienced in the last years a highly important increase in the countries bordering the Mediterranean Sea and, especially, in the Balearic Islands.
Within the nautical sector, different contractual modalities coexist, among them the contract for the sale and purchase of vessels and ships, which is detailed below.
Currently, the contract for the sale and purchase of vessels and ships is not defined as such in any regulatory provision. Thus, despite the entry into force of the Spanish Law 14/2014, on Maritime Navigation (Ley 14/2014 de Navegación Marítima), the contract for the sale and purchase of vessels and ships is not expressly regulated. Although its contents and scope were not defined in the abovementioned Law, the special features of the contract were outlined. Therefore, in order to obtain the definition of the contract for the sale and purchase of ships, we must turn to the generic definition established in Article 1445 of the Spanish Civil Code.
The sale and purchase of vessels (ships of or over 24 meters in length) or craft (ships below 24 meters in length) is subject to freedom of form, but must nevertheless be recorded in a written document, granted before a Notary or not. The sale and purchase contract may be notarized and must be registered with the Personal Property Register (Registro de Bienes Muebles) to take effect regarding third parties. Except when otherwise stated, the sale and purchase contract shall include the appurtenances of the ship and its accessories, being advisable to include an attached inventory. The conclusion of the contract shall be determined by the delivery of the vessel or craft, so to receive the full ownership, the buyer must have taken possession of the asset.
As occurs with any other kind of asset, in the nautical sector there are also first and second- hand markets, being advisable to take into account the following guidelines in the second case.
Review the documentation and request information from the Register of Vessels for additional information on the owner and to know if the ship has any encumbrance.
Execute a contract where the contracting parties, ship, price, method of payment, inventory, and jurisdiction are indicated, in addition to the invoice of purchase.
Regarding the guarantee period, it is also different in new and second-hand ships; in the first case, a two-year guarantee will be granted, being this period generally shorter and variable for second-hand ships.
In addition to the guarantees indicated above, our legal system establishes for the cases in which the purchaser has acquired the ship from a supplier, the application of regulations for the protection of consumers and users, which offer several solutions when the asset acquired does not conform with the contract:
In order to seek the protection of the mentioned regulations, the purchaser must be an individual consumer acting outside any business or commercial activity and, therefore, those purchasers that use their ship for charter activity are excluded.
It is necessary to indicate that from the sale and purchase contract a series of tax obligations will result, for which the parties will be liable taking into account certain circumstances (among others, the State, the final destination of the ship, or the capacity of the parties). Thus, depending on the case at hand, the purchaser may be liable for the payment of VAT, or he/she may deduct it in another country, if the purchaser is a foreign company, it may also occur that VAT might have been already paid and Tax on Patrimonial Transfers (Impuesto de Transmisiones Patrimoniales) might be due. In addition to the mentioned taxes, we must not forget the Registration Tax (Impuesto de Matriculación), which shall only affect those residing in Spain and that must be paid, except when any of the exceptions established by law apply.
If you have any doubt, please contact our law firm in Palma de Mallorca.
Ana María Cardona Fernández – Dr. Frühbeck Abogados Mallorca