What a Charter Broker Is
A charter broker finds a yacht for a guest and puts the charter together: the brief, the shortlist, the price, the contract and the week itself. In practice the broker works for the guest. Under the standard contract, though, the yacht’s owner pays the commission, and it is earned the moment the contract is signed. A second broker usually represents the yacht on the other side. Neither holds the money: it goes to a third party the contract calls the Stakeholder.
What a charter broker does
A charter broker finds a yacht for a guest and puts the charter together. The guest says what they want: a week in the Cyclades in July, 8 guests sleeping aboard, a chef who can cook around a nut allergy. The broker searches the available fleet, shortlists three or four yachts and reports back on each one.
The rest of the work is less visible and takes far longer. The broker negotiates the price and the dates, and confirms the yacht is really free. They draft the contract, collect the payments, brief the captain on who is coming aboard, and stay reachable during the week itself. When the air conditioning fails on the second night, the broker takes the call.
That is the job as the guest sees it. Who pays the broker is a separate question, and the contract answers it plainly.
Who pays the broker
The yacht’s owner does.
Most crewed charters in the Mediterranean use the MYBA Charter Agreement. It is published by MYBA, The Worldwide Yacht Brokers Association, which was founded in 1984. Clause 24 of that agreement states that the commission “shall be deemed to be earned by the Broker and the Stakeholder upon the signature of this Agreement by the OWNER and CHARTERER and payment of deposit funds by CHARTERER and shall be payable by the OWNER on the full Charter Fee plus the Delivery/Re-delivery Fee, if applicable, but excluding running expenses”.
That sentence holds three facts. Each one changes how a guest should read a broker’s advice.
The commission is earned at signature, not at departure. The broker’s fee is settled on the day the contract is signed and the deposit clears. What happens afterwards does not change it. Clause 24 goes further. The commission is payable “whether or not he defaults for any reason including force majeure”, and if the charterer cancels, the commission is deducted from the deposit as an expense.
The commission is calculated on the charter fee, not on spending. Running expenses are excluded. So the money a guest spends on board during the week, on fuel, food, wine and harbour dues, carries no commission. That expense account is a separate sum with its own rules.
The rate is not in the contract. The agreement says who pays and on what, and stops there. The yacht’s own agency sets rates with the brokers it deals with, and they vary. It is reasonable to ask what the rate is on a particular yacht, and a broker who works on the MYBA form can answer.
The names on the contract
The trade talks about central agents and retail brokers. The contract does not. It names four roles. Knowing which is which tells a guest who they are dealing with.
| What it is | Who it acts for | |
|---|---|---|
| Owner | The yacht’s owning company | Itself |
| Charterer | The person or company hiring the yacht | Itself |
| Broker | The intermediary named on page one | Introduces and services the charter |
| Stakeholder | Holds the money in a designated account until it is due | Both parties, as a neutral |
Central agent is the trade’s name for the agency an owner appoints to market one yacht. That agency holds the yacht’s calendar, quotes its rates and clears its bookings. It is very often also the Stakeholder. It is a real and useful role. It is a commercial arrangement between the owner and the agency, and the guest does not sign a contract with it.
In practice, two brokers often work on one charter, and only one of them started from the guest’s brief. The broker who first showed the yacht may be the agency representing it. In that case the same firm sits on both sides of the introduction. That is normal, and it is worth knowing before you read a shortlist of one.
Where the money sits
The money does not sit with the broker. Clause 20 requires the Broker to transfer all funds to the Stakeholder immediately on receipt. The Stakeholder holds them in a designated account in the currency of the agreement.
The contract then fixes when money is released. Half the charter fee (50 per cent) goes to the owner from the Stakeholder on the date the charter starts, or the first working day after. The full commission is deducted first. The balance goes to the owner on the first working day after the charter ends. The advance provisioning allowance, the expense account for the week, is paid to the captain before embarkation, or to the owner to pass on to the captain.
The security deposit works the same way. Under Clause 17 the Stakeholder holds it for the owner. It is refunded without interest on the first working day after the charter ends, or once all outstanding questions are settled, whichever is later.
What the broker is not answerable for
Clause 24 is blunt on this. It is the clause guests read last and should read first. The Broker and Stakeholder “shall have no responsibility for any loss, damage or injury to the person or property of the OWNER or CHARTERER or any of their Guests, servants or agents”. They also have no liability for errors of judgement or description “of whatsoever nature and howsoever arising”. The owner and the charterer jointly indemnify them, which means they agree to cover the Broker and Stakeholder against those claims.
So the broker fixes things, and the owner is liable for them. Those are different people, and a guest who has only ever spoken to the broker may not have noticed.
Clause 23 sets where a dispute is settled. Unless page one says otherwise, disputes go to arbitration in London under the laws of England. Arbitration is a private hearing in place of a court. A Greek-flagged yacht chartered out of Athens is still contracted this way.
Charter the same yacht twice
The contract follows the relationship for 2 years. This clause explains why a broker asks to handle the next booking.
Under Clause 24, if the charterer charters the yacht again from the owner within 2 years of completing the first charter, the original broker is entitled to commission on that second charter too. This holds whether the terms are the same or not. If the charterer books it through a different broker instead, the owner pays commission once only, on the first such charter. It is split one third to the original broker and two thirds to the new one.
A related provision covers sales. If the charterer buys the yacht within 2 years of the charter starting, the broker is entitled to a sales commission from the owner.
What to ask a broker
Ask four questions. None of them is awkward.
- Are you also the agency representing this yacht? If so, the same firm is on both sides. That is permitted and common, and it is still worth knowing.
- How many yachts did you look at, and what came off the list? A shortlist is only as good as the set it was drawn from.
- What is the commission rate on this yacht, and is it the same across the shortlist? A rate that differs between two yachts proves nothing. It is still a fact worth having.
- Who is the Stakeholder, and what account do the funds sit in? The answer should be a named company and a designated client account, not a personal assurance.
The last question matters most, and it is the easiest to answer honestly.