When it comes to dealing with cash allowances, the industry is clear in highlighting the problem does not lie with understanding the regulations (in most – but not all – cases the limit lies at 10,000 of the relevant currency) but practically applying them on board – something made more difficult if owners and guests aren’t aware of the associated regulations.
“I don’t think that most owners are aware of the amount of cash that is allowed on board, and I suppose at the end of the day that’s what they pay the captain for – to manage those sorts of issues so that they need not worry,” believes Captain Alastair Smal of motoryacht Amphitrite.
However, leaving this in the hands of the captain can cause for potentially uncomfortable situations. “As a captain it is very difficult to approach high profile guests requesting what funds they carry on their person at any time,” explains Captain Scott Kynoch of motoryacht Zoom Zoom Zoom. “I would say it would be the responsibility of the charter broker to inform potential clients of the risks involved, prior to the charter commencing.”
While 10,000 euros, for example, seems like a hefty sum, when consideration that that 10,000 includes incomplete instruments such as cheques and bearer-negotiable instruments, such as travelers’ cheques, this limit is easily reached and, according to Mary Dykes, accounts manager at Döhle Corporate and Trust Services Limited, captains need to focuses on declaration compliance rather than not hitting the limit. “In reality, while captains can try to limit the amount of cash held on board, the declaration limit is easily reached, particularly with charterers on board and when managing guest APA monies. Carrying in excess of 10,000 is not an issue with customs – not declaring it is,” explains Dykes. “In practice, most captains seek to ensure compliance via the appointment of experience licensed port agents who know the specific territorial requirements and will assist the captain and crew in ticking off many of the standard control checklist requirements over rand above cash declarations.”
"As a captain it is very difficult to approach high profile guests requesting what funds they carry on their person at any time."
Ian Petts, financial director at Hill Robinson, advises captains introduce an Imprest system, whereby the value of receipts and cash always equal the float. “It is easy to check at any moment in time the balances and they will always be below the limit. A spot check can be done at any time and it’s recommended the captain or chief stewardess checks floats and cross-checks each other’s floats each month,” Pretts explains.
Penalties for non-compliance are heavy (penalties of up to 5,000 euros can be imposed by EU courts and further penalties can go so far as confiscation of the yacht and imprisonment), so it is paramount captains understand not only the regulations surrounding cash allowances on board, but their responsibility to ensure they and the yacht comply with the regulations.
A full look at the regulations surrounding cash allowances on board can be found in ‘Prepare to declare’ in issue 13 of The Superyacht Owner.