Vessel Documentation Requirements
Coast Guard requirements for documenting a recreational vessel.
Vessel documentation in the United States is administered by the Coast Guard's National Vessel Documentation Center. Its activities are carried out under a set of laws called the United States Code as defined within the Code of Federal Regulations. This article is designed to provide a basic summary of such requirements in terms suitable for the boating pubic. More detailed guidelines, resources and definitions can be found in the references and referrals for this presentation.
Index - References - Referrals
Ownership Requirements
Requirements for owning a documented recreational vessel are subject to
certain regulatory limitations. These are mostly related to citizenship
status and the structuring of various legal entities.
Individual:
An individual applicant for
documentation must be a U.S. citizen. This can include someone born in the
United States, who became a citizen through the naturalization process or was
born outside this country to American parents. U.S. territorial citizens are
also considered as U.S. citizens with the same rights. Persons of dual citizenship in a foreign country
will qualify provided they also meet the requirements of a U.S. citizen.
Tenants In Common:
Multiple owners may hold specified shares of equity in a documented vessel
as tenants in common provided they are all U.S. Citizens in their own
right.
Joint Ownership:
Joint undivided ownership of a documented vessel is allowed if all tenants are U.S. citizens. However, such arrangements must be legally
sanctioned and structured under the jurisdictional laws in their place
residency.
Corporation: A corporation must be legally organized
and sanctioned under state, territorial or federal law in order to qualify
for documentation. Prior approval is required for a U.S. corporation
domiciled in a foreign country. The chief executive officer by whatever
title and chairman of the board must be U.S. Citizens. The same applies to
the chairman of the board of directors and no more of the directors can be
non-citizens than a minority of the number necessary to constitute a quorum.
Citizenship of the corporation's stock holders is irrelevant for
recreational endorsements.
Limited Liability Company: An LLC will qualify for
vessel documentation providing that it is structured according to
the laws of its domicile and all members are U.S. citizens. If managed by a non-member,
such party must also be a U.S. citizen.
Partnership: A Partnership
may qualify for vessel documentation provided it is legally organized
within the jurisdiction of domicile, all partners are U.S. citizen and
at least 50% of the partnership's equity is owned by U.S. citizens. In a
limited partnership, all general and limited partners must be U.S. Citizens.
Any changes in the general partners will precipitate the need for
re-documentation.
Association
or Joint Venture: An association or joint venture will qualify for
documentation providing it is legally organized within the
jurisdiction of domicile and each member is a U.S. citizen.
Trust: .A trust may qualify for vessel documentation
providing it is legally organized within the jurisdiction of domicile, each
of its trustees is a U.S. citizen, any beneficiary with an enforceable interest in the trust is a
U.S. citizen.
Estate: The Coast Guard does allow ownership of a
documented vessel under the name of an estate. This is because an estate is
not generally viewed as an entity, but rather an arrangement where the
decedent's assets are managed by an executor, administrator or heir. It does not, however, preclude such parties from documenting the
subject vessel under such capacity their personal names.
Tribal: Tribal ownership may take form in various ways,
whether as a government type of entity or business entity. Tribal owned
vessels will qualify for documentation provided the method of ownership is
duly sanctioned and the rules of citizenship are observed.
Trade Name:
The Coast Guard does not recognize a trade or fictitious business name for
ownership purposes. A vessel must accordingly become documented in the name
of the underlying entity's name.
Multiple Methods: Individuals and
various entities can share ownership of a documented vessel provided they
meet all the necessary requirements in their own right.
Prior
Ownership: Citizenship is not of issue for interim or prior owners when
applying for vessel documentation
whether of record or chained from with instruments of transfer.
Residency
Requirements: The place of residency for an owner, whether domestic or foreign, is not
of consequence for owning a documented vessel. However, the managing owner
must provide a physical address with a valid postal code. Exceptions may be
made by special request for liveaboards and other legitimate reasons.
Competence: The regulations do not specify any particular age or
competency requirements for owning a documented vessel. It is assumed that
an applicant has a right to hold ownership according to the
laws where domiciled. In any event, this can impact the viability of any
subsequent transactions from a legal perspective.
Vessel Requirements
Requirements for recreational vessel documentation are
subject to various Coast Guard regulations. These include tonnage capacities,
definitional standards and prescribed marking standards.
Vessel Defined:
The Coast Guard defines a vessel as any type of watercraft capable of being used as a means of
transportation on water. This encompasses almost
everything from ski boats to mega yachts provided they meet minimum
tonnage requirements. The type of boat and its manner of propulsion is of no
consequence and may include power boats, sail boats, house boats and barges.
Inflatables will qualify for documentation, although the document must be
surrendered if deflated or altered in any way whatsoever.
Tonnage Requirements:
In order to qualify for documentation, a vessel must measure out to at least
5 net tons in terms of volume. This is based on a formula using the length,
width and depth. Most vessels under 25 feet in length will not meet this
requirement. Measurements for vessels under 79 feet in length may come from
a builder's certification or by completing a simplified measurement form.
Those beyond that size must be formally measured by a Coast
Guard approved company.
Build Evidence: The country in which a vessel was
constructed is of no consequence for recreational documentation purposes. If
built in the United States, however, it is advisable to provide such
evidence as this may enhance its value for subsequent commercial usage. This
must be established from a special builder's certificate or letter of
constructions with the equivalent information.
Endorsements: When applying for vessel documentation, the owner must
declare the kind of activities under which it will be operated. A
certificate of documentation is then endorsed for such usage, including any combination of those for
recreational, registry, fishery and coastwise endeavors. A recreational endorsement for the type of usage presented
in this article is the least restrictive while those for
commercial endeavors may grow increasingly complex.
Marking
Requirements: Coast Guard regulations are quite specific when it come to
the manner in which a documented vessel must be identified. This includes
the affixation of an assigned official documentation number inside of the
hull and a chosen name and hailing port on a visible part of the exterior.
Names are not exclusive and hailing ports can be arbitrarily chosen provided
they are a place in the United States. However, vessel names may not
conflict with emergency call signals or contain profanity and racial epithets. All
markings must conform to Coast Guard placement and size requirements. State registration
numbers may not be displayed on a documented vessel although periodic decals
are allowed.
Title Restrictions: Although state jurisdictions are allowed to
issue registration certificates on documented vessels they may not issue
state titles. This also applies to foreign titles, especially when it
comes to national registries.
Altered Vessels: Vessels
having undergone renovations that altered its specifications or
configuration must become re-documented. This will require a new admeasurement certification along with a
letter of explanation.
Bareboat Charter: A vessel documented
solely for recreational usage can be rented or chartered provided it is not
placed under the command the owner or a skipper hired by the owner.
Foreign Transfers:
Government approval for transfer of documented vessel to a foreign citizen
is not required provided it has not been used commercially. However, the vessel
must be formally deleted from documentation with a notation as to the transferee's country of citizenship.
Customs Clearance: The Coast
Guard does not concern itself with matters of customs clearance when
documenting imported
recreational vessels. This does not mean, however, that such issues should
be ignored as failure to comply can result in sever consequences.
Title Requirements
In documenting a recreational vessel, the applicant must
present sufficient evidence of ownership. This must conform to certain
requirements as specified in Coast Guard regulations.
Builder's Certification: Manufacturers of
vessels that are destined for USCG documentation will issue a builder's
certification form specifically designed to meet the place built,
measurements and other specification requirements. A builder's certification
also suffices as the first assignment of ownership.
Manufacture's Statement of Origin: A manufacturer's statement of
origin is designed primarily for state level registration and titling
purposes. Although acceptable as evidence of first assigned ownership, this will not
fulfill Coast Guard requirements for measurement specifications or the place built.
State Registrations or Titles: The Coast
Guard will accept a state title or current registration certificate from a
non-title state as evidence of ownership. However they will not honor
certificate assignments unless accompanied by a recordable instrument of
transfer such as a bill of sale. Liens, encumbrances and security interests
recorded on the state level are typically ignored for documentation purposes
and must become re-established through recordable instruments.
Foreign Registrations or Titles:
When documenting a vessel from a foreign national registry system you will
need to provide certified evidence that is has been removed or deleted.
Provincial titles and registrations are also acceptable, but may need to be
supported by some type of validation. If such items are provided in a
foreign language they must be translated into English by a
qualified vendor.
Prior Documentation: If a vessel is currently
documented, ownership can be assigned on the reverse side of a certificate
of documentation or through a recordable instrument of transfer such as a
bill of sale. An instrument of transfer will also suffice if founded on the
last owner of record as shown on an abstract of title. If a long period of
time has elapsed since the recording, an applicant may need
to provide a
statement of facts as to why it was not registered or titled elsewhere in
the interim.
Statutory Foreclosure: Statutory foreclosures include vessel transfers conducted under state or federal laws for mechanic’s liens, loan defaults, storage liens, and abandonments. To establish ownership, you must submit a copy of the applicable statute, an affidavit of compliance
thereof and evidence of any required notices or actions taken. If the vessel was sold at auction, a recordable instrument of transfer such as a bill of sale or equivalent is also required.
Court Order:
A certified court order may serve as evidence of ownership when a vessel is
transferred by legal judgment. To be accepted, it must clearly state the
intent to transfer ownership and identify the vessel by hull identification
number and, if applicable, official number. However, such actions typically do not extinguish existing liens or encumbrances, which must be separately addressed. In contrast, federal court awards under admiralty jurisdiction are usually sold at public auction by a U.S. Marshal, who issues a special bill of sale. In these cases, liens and encumbrances are generally extinguished by operation of law.
Forfeiture: Vessels forfeited to the U.S. Government due to violations of law such as drug trafficking or smuggling may be sold by federal authority. Title is typically conveyed by federal court order or administrative
affidavit. When the transaction is clearly identified as a government forfeiture, all prior liens are generally extinguished. In such cases, the Coast Guard does not require evidence of prior ownership.
However, documentation of forfeiture and transfer is subject to Coast Guard approval.
Interim Owners: Interim ownership from the last recorded title,
registration or documentation may be chained through instruments of transfer
provide they conform with Coast Guard recording requirements. However,
extensive lapses in such recordings may be questioned by the NVDC.
Recordable Instruments
The Coast Guard maintains an underlying abstract of title
for each vessel similar to what you may find in real estate. Transfers of
title, mortgages claims of lien, ancillary recordings and certain notations
are chronologically indexed.
General Requirements:
Recordable instruments are subject to certain federal standards and must
conform to the jurisdictional requirements in which executed. Although the
NVDC may provide certain examples, the design and structure of most forms
are inconsequential provided they contain the required citations and clearly
indicate the purpose for which intended. The party's signatures must also
become duly notarized according to regulatory standards.
Transfers of Interest: Instruments of ownership transfer may include
such items such as a bill of sale, transfer of interest, deed of gift or any
other form of conveyance that meets jurisdictional requirements. However,
these must contain the appropriate citations as set forth in federal
regulations and become duly notarized.
Vessel Mortgages: A mortgage on a USCG documented vessel may be
recorded on the vessel’s abstract of title if properly structured with the
required citations and duly
executed.
When clearly identified as a "Preferred Mortgage", it may acquire priority status based on the date and time of filing.
The citizenship of a mortgagee is not of consequence for recreationally
documented vessels. Transfers of ownership and changes in documentation status are not
allowed on a mortgaged vessel without the mortgagees consent.
Mortgage Supplements: Mortgage supplements such as amendments,
addendums, assignments and subordinations will qualify for recording if
properly drafted. In general, they must clearly state the intent, contain
the required citations and become notarized.
Claims of Lien: Liens a maritime nature may become recorded on the
abstract of title for a documented vessel. This would typically include
services, supplies, necessaries and other actions related to operation of
the vessel itself and not those personal to the owner. These are
informational only as public notifications and do not automatically confer
rights of foreclosure. They must be filed according to statutory
requirements which includes an owner and any mortgagee notification
procedure. Supplements such as those for mortgages are also accepted.
Lien Priorities:
Maritime law has its own rules for lien priorities on documented
recreational vessels. Generally, salvage comes first, followed by tort
claims such as personal injury, then preferred mortgages, and finally liens for supplies and repairs. Even if a mortgage is recorded, some maritime liens can still take priority. Except for preferred mortgages, more recent liens are often paid
on settlements before older ones.
Satisfactions and Releases:
Upon retirement of a mortgage or settlement of a claim, the
mortgagee or claimant must record an offsetting satisfaction or release form in a timely
manner. Failure to do so, may result in liability for damages to the
existing owner.
Notarizations: Recordable instruments must be
notarized in accordance with the rules of the jurisdiction in which
implemented. If performed in another country, it must be a party to the
Hague Convention and accompanied by an apostille. U.S. consulates can also
preform notarizations when abroad. Electronic or digital notarizations are
generally not accepted.
Processing Requirements
All matters related to documenting a vessel with the U.S.
Coast Guard are handled by the National Vessel Documentation Center (NVDC).
In such capacity, it has developed its own set of administrative policies
and procedures.
Application for Documentation: It all begins with a application
for documentation that serves as a declaration of citizenship and provides
vessel data along with the desired vessel name and haling port. It also
provides details about it's intended usage, desired endorsements and reason
for submitting the application. The application will not, however, determine
how ownership will become listed as this is determined by whatever is
provided for evidence of title.
Change in
Status: Re-documentation is required whenever there is a change in
ownership, the managing owner, vessel name or haling port. or change of
legal name. The same applies for failure to renew or change of owner
legal name. A new application must be filed under these circumstances along
with the respective fees.
Managing Owner: An applicant for
documentation must appoint one of the owners as a managing owner for
correspondence purposes. When a vessel is documented to a corporation, the
corporate name will be stated as the managing owner. A change of address for
the managing owner can be accomplished without re-documenting.
Vessel
Identification: A vessel must be properly identified by its
official documentation number and/or hull identification number for both
application and recording purposes. Numbers that do not conform to
regulatory standards may be questioned by the NVDC. State registration
numbers are not sufficient for identification purposes.
Processing : Upon receipt of an application, the NVDC will issue a
unique official documentation number and initiate an abstract of title that includes an
index for all recordings. A successful application will then result in the
issuance of a certificate of documentation that must remain on the vessel
while underway.
Filing Fees: Application and recording
submissions must be accompanied by the respective filing fees. A listing of
these is available on the NVDC website.
Electronic Filings: The NVDC will now accept
copies of all instruments and supplemental items through digital means. The
originals are not required and should be maintained by the owner. They have
also initiated a means of submitting applications and certain recordings
through their website portal.
Priority Handling: All submissions are time-stamped and processed in the order received. However, commercial applications take priority over
those for recreation only. Recreational applicants may request expedited handling using a special form, but approval is typically reserved for vessels preparing to depart for foreign waters. Requests for vessels already in transit are generally denied. Other requests are reviewed at the discretion of the processing officer and may be affected by current workload.
Status Requests: Applicants may check the status of any submissions
online at the NVDC website or by calling their office by telephone.
Determinations: Before submitting, applicants for vessel documentation may request a letter of determination from the NVDC to confirm whether a questionable filing meets regulatory requirements. However, such requests must relate to a specific application and will not be accepted for general or hypothetical scenarios.
Filing Deficiencies:
An applicant for vessel documentation will be notified in the event any
submission deficiencies and afforded a chance to correct any problems. The file
is then paced at the bottom of queue and will be terminated with a
forfeiture of fees if not rectified in a timely manner.
Substantial
Compliance: The NVDC may accept submissions that are not in full
compliance with rules and regulations if they are deemed to meet such
intent. In dealing with this, however, you will need to submit a letter of
request accompanied by a statement of facts and any supporting evidence. It
will then be taken under consideration and you will be notified of the
outcome.
Affidavits and Sworn Statements: Affidavits and sworn statements submitted with applications or recordings
for vessel documentation must comply with the laws of the jurisdiction in
which they are executed. Foreign affidavits are only accepted if performed in a country that is a party to the Hague Convention and accompanied by an apostille.
Alternatively, a U.S. consulate may perform an attestation.
Translations:
Any title documents or recordable instruments presented in a foreign
language must be accompanied by a translation into English. This can only be
performed by a qualified translator.
Removal from Documentation:
Given that a certificate of vessel documentation is now periodic, there is no
longer a need for its surrender. However, an owner should file a request for
removal form to make sure they are no longer viewed as the owner of record.
This is important because such records are maintained indefinitely.
Certificate Renewals: Certificates of vessel documentation must be
renewed periodically in increments of one to five years depending on your
preference. Although the NVDC will send a notification, it is incumbent on
the managing owner to make sure this happens even if not received. Failure to do so in a timely
manner will result in the need for re-documentation with the respective
fees.
Obtaining Copies: Copies of application submissions, abstracts
of title, certificates of ownership, vessel documentation certificates and recorded
instruments copies are available from the NVDC. Abstracts of title and certificates
of ownership can be ordered online from their website whereas all others
must be requested in writing.
Conclusion
This summery is a condensation of recreational vessel documentation requirements that have been gathered from various sources and may contain errors, omissions or misstatements. You should contact the appropriate agency or seek legal consultation before taking any actions based upon this material. Please be reminded that these citations may not be applicable for commercial documentation purposes.
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