This was the last summer before the scheduled entry of Croatia in the EU on the 1st of July 2013. Croatia has always been a popular nautical destination and the owners of vessels, including companies from Slovenia and EU, will have to ensure the appropriate status of all the vessels that are now on temporary import and still don’t have an appropriate legal status.
It is to be expected from Croatian state authorities when entering EU to strengthen their control over the status of vessels, so we recommend to all the owners of vessels who have not yet arranged the status of their vessels, to do so after the end of this year’s nautical season, or at the latest before Croatia enters the EU.
Arrange your vessel status in time
It is good to know that the citizens of RS or any other EU member are not allowed to use any vessel that does not have the appropriate status in the area of EU customs territory. The use of vessels that have not had adequate procedures for release of vessels into free circulation and have not payed tax and customs obligations in Slovenia or EU is not allowed.
For vessels that are registered outside the EU region, there is a possibility of temporary import with full exemption into the territorial waters of the EU, but only for vessels registered in the name of a person that has been registered outside the customs area and for vessels used by an entity located or resident outside the EU territory. If the owner of the vessel or if the vessel is in use by an entity seated in the EU, natural or legal person (including leasing companies) from the EU, they will be able to use vessels in Croatia after 1st of July 2013 only if they will have a status in accordance with EU regulations.
Exception to the rule
should only be the vessels owned by Slovenian or other EU counties – natural or legal persons – which will at the time of Croatia’s entry in the EU be located in Croatian territorial waters and have already started the procedure of temporary importation. These should be, after the Croatia’s entry in the EU, considered, until the completion of before mention procedures, treated under current Croatian regulations. After the completion of all procedures the vessels mentioned above should be released for free circulation within the EU, or removed from the territorial waters of the EU.
Customs and VAT for the EU status of vessels
If Slovenian owners want to arrange an appropriate EU customs status before Croatia enters the EU, they will have to bring their vessel into the Slovenian sea to one of two international sea border crossings (Piran or Koper) and start the procedure of the release of the vessel in free circulation within the EU. At the same time they will have to pay customs duty and 20% VAT. Customs basis of used vessels is determined by dividing the purchase price, which is reduced to a mileage allowance, or there is also a possibility to consider the value determined by the valuator of maritime profession. It is of high importance that all the residents of RS, regardless of ownership of vessels registered in Slovenia or abroad, will have to pay a special tax for water vessels over five meters, which meet technical requirements for enrollment in the registry of vessels.
Current practice
Temporary import of vessels
According to the current Croatian law, a temporary import into Croatia is allowed for a vessel, which is registered outside of Croatia, for up to 24 months. Since Croatian customs authorities have not been performing frequent and rigorous inspections of temporary admission, the vessels remained on temporary importation for several years. In accordance with Croatian legislation all owners of vessels that have not removed their vessel after the end of the temporary importation period will be obligated to pay customs duty, VAT (25%), and additional special tax. At the time of preparation of this article it is still not known which legislation will be valid in Croatia after entering EU. But it is to be expected that the Croatian legislation should – for the field of taxes and customs- be similar to Slovenian legislation when entering the EU. Croatia will be obligated to align their legislation with European legislation, which is in the field of taxes and customs harmonized on the EU level. It is to be expected that the legislation will apply in Croatia by the end of this year or at the beginning of next year.