Greece: Costly Misinterpretation of EU Law
At a time when all elements of the Greek tourist industry are working hard with health officials to minimise the impact of Covid and make Greece a safe place for foreign tourists to visit, misinterpretation of EU Brexit directives by the Greece’s AADE (Independent Authority for Public Revenue) puts income estimated at tens of millions of Euros at risk, according to the Cruising Association.
Published 3 years ago
A spokesman for the Cruising Association says the argument is over the AADE’s refusal to follow EU directives on the Union Customs Code and the Brexit Withdrawal Agreement. This states that any (tax paid) British flagged vessel in EU27 waters at midnight on 31st December 2020 automatically retained full EU27 VAT tax paid status.
Greece has been a popular cruising area for British sailors for more than 50 years and around 5,000+ owners have contracts to keep their boats permanently in Greece, many owners typically spending the entire summer in the country.
Six months prior to Brexit, the London-based Cruising Association entered into talks with government officials to see if a combined cruising tax and visa could be introduced to ensure British owners could keep on visiting their boats for up to six months at a time rather than just the 90-day restriction imposed by Schengen rules.
“A positive outcome would have been a win/win situation for everyone and negotiations seemed to be going well,” claimed Christopher Robb of the CA. “We were taken by complete surprise when the AADE announced they would not fully recognise the VAT paid status of British boats.”
The AADE decision recognises the VAT status of UK Flagged yachts until they leave and return to EU Waters, when they will then be subject to Customs procedures and temporary admission for 18 months. This will effectively limit the time a British vessel can spend in Greek waters to just 18 months before it must leave.
Ironically, the rest of the EU are prepared to welcome this exodus of boats without any such time restriction. France has already agreed to offer six-month visas to boat owners allowing them summer long cruising. Many yachts will now move to overwinter in Turkish boatyards and may never return. This would be a massive loss for Greek Marinas.
“We really do not understand why the AADE have adopted this unique position,” Mr Robb continued. “It will not only have a major negative impact on Greece’s marine infrastructure but will devastate the economy of many smaller islands who rely heavily on visiting yachts for their income.”
The Cruising Association has lodged an official complaint with the EU Commission over AADE’s non-compliance with EU law. Whilst Christopher Robb remains optimistic that the issue will be resolved amicably, he admits that some owners have already made plans to leave Greek waters the moment Covid restrictions are lifted. International shipping agents Peters & May are scheduling a weekly boat relocation service from the Ionian, a service totally unheard of prior to the AADE’s decision.
For more information:
This article by KPMG is useful background reading.
Christopher Robb (CA)
Email: Chris.robb@theca.org.uk
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Related News:
Greece: News from the CA on VAT Status and the Transit Log for UK Yachts
Related to following destinations: Greece
Related to the following Cruising Resources: European Union
Just in from the CA:
UK yachts don’t need TL for Greece
The Greek tax authority, the AADE, has agreed: “UK-flagged vessels moored or sailing in EU waters before the Transition Period ended (1.1.2021), regardless of where the taxes have been paid, retain their EU status for as long as they remain in [those waters].”
This has been its position for some time, but the AADE did not initially tell its Customs offices that, as a result, UK yachts will not have any customs procedures and do not require a Transit Log (TL), until they leave EU waters and return. Therefore, offices insisted incorrectly that UK yachts must have a TL to sail in EU waters. This matter is now supposedly corrected but incidents are still happening. If you have an issue on this with Port Authorities (Customs), insist that the office ring Georgia Tounta of the AADE VAT-Customs on 0030 210 698 7417 for correct advice.
The issue of returning from outside EU waters remains in dispute (Returned Goods Relief). If you leave EU waters you export your yacht (as for all VAT Goods) and temporarily lose EU Goods Status. On returning to Greece you should be able to check in to Customs and apply for “Relief from paying duty” under the exemption given in article 203 of the Union Customs Code (UCC). This is an automatic right and is not at the discretion of the local Customs officer. However, the AADE has not advised its offices of this and currently the issue is the subject of a formal complaint to the EU Commission. We are expecting results on this by June 10 and the CA website and forums will be updated accordingly.
Until this matter is settled yachts should accept whatever Transit Log is offered, to avoid Impounding of the yacht, and sort the matter out later, if necessary contacting the CA for help (if you are a member of course).https://www.theca.org.uk/