What an APA Is

What the charter fee already covers

The APA makes sense only against what has already been paid for, so start there.

Most crewed charters in the Mediterranean run on the MYBA Charter Agreement, the contract issued by MYBA, the worldwide yachting association. Its Clause 8 states that the charter fee includes the yacht “with all its equipment in working order; tools; stores; cleaning materials and basic consumable stores for engine room, deck, galley and cabins; laundry of ship’s linen; the crew’s wages, uniforms and food; the insurance of the Vessel and crew”.

The list shows the shape of the deal. The yacht, the people who run it and the ship’s own supplies are paid for. Everything the guests themselves consume is not.

One item is easy to miss: the crew’s food is in the charter fee, but the guests’ food is not.

What the APA pays for

The same clause says the charterer pays, at cost, for all other expenses, and then lists them:

• fuel for the main engines and generators
• fuel for tenders, the small boats that take guests ashore, and for water sports equipment
• food and all drinks for the charter party
• berthing dues and other harbour charges, including pilots’ fees, local taxes, divers’ fees, customs formalities and any charges for waste disposal
• water and electricity taken from shore
• ships’ agents’ fees where applicable
• personal laundry
• communications and internet use
• the hire or purchase of any special equipment put on board at the guest’s request.

The phrase that matters is “at cost”. The APA is the guest’s own money. The captain holds it and spends it on the guest’s behalf at what each item cost, so it is neither a package price nor a budget the yacht may spend up to.

Fuel is usually the largest and most variable cost. A motor yacht that runs 6 hours a day burns far more fuel than one that moves between two anchorages all week. This is why two identical weeks on the same yacht can produce very different final accounts.

How much it is

The contract does not say. Page one has a blank marked “Plus: Advance Provisioning Allowance (A.P.A.) (see Clause 8)”, and the figure written in it is agreed before signing.

In practice the trade quotes the APA as a percentage of the charter fee. Published guidance commonly puts it at 30 to 40 per cent on a motor yacht, and lower on a sailing yacht or catamaran, where the fuel bill is smaller. The ranges quoted vary between brokers, and the percentage is an estimate of consumption, not a price.

What the percentage means matters more than the figure. A high APA does not make a charter more expensive. It is a larger float against the same costs, and what is not spent comes back.

How the money is held and spent

The APA does not stay with the broker. Clause 20 requires it to be paid by bank transfer before embarkation, to the captain or to the owner for passing on to the captain. The captain holds it and spends from it.

Clause 8 then places duties on each side: two on the yacht and one on the guest.

On the yacht, the captain must tell the charterer at intervals how the APA is being spent, and the owner must ensure the captain “will exercise due diligence in the expenditure of the APA”. A guest is entitled to know where the money is going while the charter is running, and not only afterwards.

On the guest’s side, if the remaining balance becomes too low for current spending, the charterer must pay the captain enough to keep an adequate credit balance. A request to top up in the middle of the week is the contract working as written. It does not mean something has gone wrong.

Two smaller provisions are worth knowing before departure. Any bank charges for transferring the APA to the yacht are paid by the guest, and exchange rates cannot be guaranteed. Payment by cheque or credit card is not normally accepted, because a yacht moves between countries during its season.

The account at the end

Before the guests disembark, the captain presents a detailed account of spending with as many supporting receipts as possible. The guest then pays any balance still owed, or the captain repays any overpayment.

That is the whole reconciliation, and it happens on board, not weeks later. A guest who wants the account sooner should ask for it sooner. The duty to report at intervals is already in the contract.

Where money is owed back, ask how it will be returned before the charter ends. Cash on board and a transfer afterwards are both normal. Agreeing which one applies takes a minute at the start of the week and can take a month at the end of it.

What the APA is not

Four things sit outside the APA, and confusing any of them with it is a common mistake.

• It is not the security deposit. Under Clause 17 the security deposit is a separate sum, held by the Stakeholder for the owner against damage. The Stakeholder is the party the contract names to hold it. The deposit is refunded without interest on the first working day after the charter ends, or once any outstanding questions are settled.
• It carries no commission. The broker’s commission is payable on the charter fee and expressly excludes running expenses, so nothing in the APA carries a commission.
• It does not cover extraordinary expenses. Clause 8 treats special excursions, special equipment, transport on shore and anything not usually part of the yacht’s operating costs as separate. These are paid in advance through the broker’s account, or to the captain on boarding, in addition to the APA.
• It is not the crew gratuity. The contract’s list of what the charterer pays at cost does not mention a tip. The guest and the captain settle whether a gratuity is taken from the APA or handled separately. That conversation is far easier at the start of a week than at the end.

What to check before signing

Ask three questions about the figure on page one:

1. What consumption does this APA assume? A figure based on 3 hours under way a day and one based on 6 are not comparable, and the itinerary is what changes it.
2. Which of these costs does the charter fee already cover on this yacht? The MYBA list is the default, and page one may change it.
3. How and when will an unspent balance be returned? Agree this before departure.

A broker who works on the MYBA form can answer all three from the contract, because all three are in it.