S.L. 234.43 Art. 6Ship management activities.

(1) Any income derived by a ship manager from ship management activities shall be deemed to be income derived from shipping activities and shall be exempt from tax under the Income Tax Act provided that:

(a) the condition contained in sub-regulation 5(3) is complied with; and

(b) the ship manager has paid to the Registrar-General an annual tonnage tax to be determined as follows:

(i) in respect of any tonnage tax ship registered under Part II or IIA of the Act, an amount equivalent to twenty-five per cent (25%) of the annual tonnage tax payable in respect of the particular ship on the basis of the rates stipulated in the First Schedule to the Act; and

(ii) in respect of any other ship not referred to in paragraph (i) above, an amount equivalent to twenty-five per cent (25%) of the annual tonnage tax calculated by reference to the rates stipulated in the First Schedule to the Act which would have been payable had the ship been registered under Part II or IIA of the Act;

(c) at least two-thirds of the tonnage of the ships to which the ship manager provides ship management activities is managed from the territory of the Union;

(d) the tonnage in respect of which the ship manager provides ship management activities satisfies the flag-link requirement as set out in regulation 4(2) above; and

(e) for the purposes of paragraph (d), the percentage of a ship manager’s total tonnage which is Union-flagged shall be determined by expressing as a percentage the sum obtained by dividing the aggregate net tonnage of Union-flagged ships in respect of which the ship manager provides the ship management activities as at a particular date by the aggregate net tonnage of all ships in respect of which the ship manager provides the ship management activities at such date.

(2) The provisions of sub-regulations 5(2) and 5(4) hereof shall, mutatis mutandis, apply to a ship manager providing ship management activities.

The provisions of the Act relating to the manner of payment and collection of fees and to penalties imposed in case of default shall also apply mutatis mutandis in respect of the annual tonnage tax payable by ship managers providing ship management activities in terms of these regulations.