Boat rental business - how to start one  

• 13.11.2023.
• News, Regulations

Have you ever wondered how to open a boat rental business here? Croatia is a country that abounds in natural beauty, made for rest and relaxation, as well as adventure, which is why visitors from all over the world flock to the Adriatic coast every season.

If you have been building a story in your head for some time now on how to use the natural advantages of living in Croatia to build a successful business, this is the article for you.  
   
In it, we will deal with instructions on how to start a boat rental company, which is also one of the more popular ways that guests like to explore the delights of the Croatian coast.  
   
Every business start is complicated and full of questioning and uncertainty due to unexplored terrain and still unknown information.  
   
In the hope that we will facilitate your first steps and encourage you to contribute to Croatian entrepreneurship, we have prepared a brief overview of the most important legal provisions you need to comply with when starting a boat rental business.  

  

What is boat rental and who can do it  

Nautical tourism is regulated by the Law on providing services in tourism. Still, as one of the most essential services of nautical tourism, the boat rental business is subject to additional legal regulations.  
   
The activity of renting a vessel includes renting a vessel and/or providing accommodation services on a vessel in internal sea waters and the territorial sea of the Republic of Croatia.  
   
From a legal point of view, there is a difference whether the guests will spend the night on the vessel or just rent it for the day.  
   
If they do not spend the night, then the provisions of paragraph 1, points 1, 2 and 6 of Article 12 of the Ordinance on the conditions for carrying out the activity of renting vessels with or without a crew and providing the service of accommodation of guests on the vessel do not apply to you. You do not have to submit an eCrew Application to the Ministry.  
   
Charter activity can be performed by any vessel owner registered for commercial purposes, with the condition of establishing a company or trade that covers this activity with its headquarters in Croatia.  
   
Likewise, the vessel's owner can conclude a contract with a yacht charter company registered in Croatia, based on which the charter company takes over the powers and responsibilities for managing the vessel prescribed by the Ordinance as mentioned above.  
   
The vessels you plan to rent can be of Croatian nationality but also of EEA/EU or third countries if they have been granted cabotage approval.  
   
Also, charter activity can be carried out by a foreign yacht charter company that has its seat outside of Croatia, provided that it has an OIB and a VAT ID number issued by the tax authorities.  
   

Conditions for starting a boat rental business  

In addition to the above-mentioned conditions for opening a boat rental business (such as owning a boat or concluding a contract with the owner of the boat and establishing a company or business that covers the activity of boat rental), some other conditions are necessary to mention before we start with the specific documentation.  
   
When it comes to the conditions that must be respected in connection with the vessel rented out, it must be registered for commercial use. It must also be technically suitable for boat rental activities (which will be determined by a technical inspection). It must have a minimum number of crew members with appropriate professional qualifications.  
   
In addition to having valid documents, depending on the country in which they are registered, you should also have an active liability insurance policy.  
   
Keep in mind that after opening a boat rental business, you must have equipment for electronic submission of crew and passenger lists, including an Internet connection and equipment for using an advanced electronic signature. The mentioned equipment is necessary so that you can report the list of crew and passengers to the Ministry's central database before each voyage.  
   
In addition, you will need to have a space for receiving guests and designate at least one person responsible for the technical correctness and handover of the vessel and for providing support to guests during sailing.  
   
For guests who will spend the night on the rented vessel, a tourist tax is charged, which is calculated by the Croatian Tourist Board.  
 

 

Documentation for starting a boat rental business  

To open a business for renting boats and to be able to smoothly carry out activities related to renting boats, you will first need to register with the Commercial Court the activities that you intend to carry out as part of that company.  
   
As we mentioned above, if you are going to offer your vessels and accommodation to guests before starting business, you should submit an eCrew application to the Ministry of the Sea, Transport and Infrastructure.  
   
Based on this request, you will receive from the Ministry the information necessary to access the eCrew system, which enables craft for chartering vessels online registration of the list of crew and passengers no later than the moment of departure of the chartered vessel.  
   
You will submit the request for eCrew to the Ministry electronically to the e-mail address charter@pomorstvo.hr.  
   
If, as a boat rental business, you intend to rent Croatian vessels of which you are not the owner, with the eCrew Application, you will need to attach a copy of a valid registration form or sailing license and a copy of the boat rental agreement concluded with the owner or user of the boat, certified by a notary public.  
   
In the case of renting a vessel belonging to a foreign state (EEA/EU or a third country), Documents for vessels belonging to a foreign state are also required along with the Application. The specific documentation will depend on the country of the port of embarkation, the vessel's flag and the headquarters of the vessel rental business.  
   
By the way, once you go on a regular boat rental, you should always have documents that prove all the prescribed procedures the boat rental business must perform before sailing have been carried out. These are the return documents printed after submitting the crew and passenger list, the record of the handover of the vessel and the invoice issued.  

  

Business plan for boat rental business  

After unravelling this legal tangle surrounding the start of a boat rental business, we believe you will feel ready to start solving the necessary documentation as soon as possible. However, we would like to draw your attention to another vital aspect of charter business: sales and marketing.  
   
Before you start taking any concrete steps related to establishing a boat rental business, first commit to developing a business plan that will include planned activities related to sales and marketing.  
   
An elaborate business plan will help you connect your idea, research the market and lay a solid foundation for your business.  
   
Keep in mind that over 4,000 vessels are your competition in Croatia. An absolutely perfect boat rental business will have a hard time surviving this kind of competition and surviving if the guests who need the services have not heard of it - that's why marketing and sales are key components of the nautical tourism business that must be addressed.  
   
Additionally, investing in advertising will be seen as a good sign by those considering working with your boat rental business as charterers or business partners. It tells them you have enough business success and profits to allow advertising.  
   
We hope this article has shed some light on some of the unknowns holding you back from starting a boat rental business.  
   
We also hope that you are ready to do what is necessary to welcome guests every season with an offer of unique experiences and an unforgettable holiday on the Croatian coast.  
   
We wish you a long and successful business; boldly move forward one step at a time!

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