California’s For-Hire Charter Licenses: What You Need to Know

State’s Division of Boating and Waterways is currently in rule-making process for licensing program.

STATEWIDE — Several articles published in The Log in recent months harped on the existence of illegal charter or passenger-for-hire activities in local harbors and marinas. The evasion of regulations governing commercial use of passenger boats has led U.S. Coast Guard and local law enforcement officials to ramp up increased efforts to monitor the legality of individual charter services.

Federal, state and local law enforcement officers and policymakers consistently state the need to regulate illegal charter operations is to protect consumers from potentially unsafe navigations. To that end Coast Guard officials have launched initiatives to either be more proactive in monitoring passenger-for-hire activities or working with local authorities to develop new policies and standards governing illegal charters.

Regulating for-hire charters – whether on state or federal waters – is still a work-in-progress. Multi-agency efforts in several regions are already underway to clarify governance and regulation of for-hire operations aboard recreational vessels.

Most of our recent coverage focused either on what consumers should pay attention to prior to boarding a passenger-for-hire vessel or the requirement necessary to operate a charter service.

California’s Division of Boating and Waterways (DBW), interestingly enough, offers a licensing program dedicated to for-hire vessel operations. The program outlines what boat owners must do to obtain a license, who must be licensed and where jurisdictional boundaries are set.

DBW’s program includes an examination step and several forms to be filled out. Study materials for the exam are available on DBW’s website about the program. The website also explains the special requirements passenger vessels must follow to be licensed.

Here is a quick primer of what recreational boaters should know while on waters within state waters (followed by a brief reminder of Coast Guard regulations for waters within federal jurisdiction).

California’s For-Hire Vessel Operator Licensing Program

Boat operators carrying four or more passengers within state waters and for any form of compensation must be licensed, under state law. Water skiers being towed by a boat are considered passengers, according to DBW.

Waters within California’s (and not federal) jurisdiction are specifically areas where boaters cannot navigate to the ocean or another state. Big Bear Lake, Diamond Valley Lake, Lake Elsinore and Salton Sea are examples of waterways fully under state jurisdiction.

What are the licensing requirements?

Licenses are granted to boat operators age 18 and up and have at least one year’s experience operating the vessel he or she seeks to have certified. The applicant must be in good physical condition and, according to DBW, have “adequate knowledge and skills necessary for safe operation of a passenger vessel.”

Applicants must also pass written and on-the-water practical examinations.

Obtaining a license is free of charge (though the applicant will probably have to pay a physician for the medical examination). The license, once obtained, is valid for five years.

Testing process

Boaters seeking a state license to operate a for-hire vessel must pass an examination in order to receive the state’s permission to use his or her vessel for commercial operations. The applicant must be knowledgeable of California boating laws, basic facts of life preservers and marine fire extinguishers, possess a boating safety card as well as have knowledge of first aid, piloting, seamanship and small boat handling.

The exam itself covers several subjects: accident reporting; for-hire license lighting; navigation rules; vessel operation/equipment; vessel registration; waterway marking system; fire prevention; safe boat operation; vessel maintenance; and, first aid.


Applicants must file the following documentation with the state in order to be certified: for-hire license cover sheet; for-hire license application; statement of boat handling ability and moral character; and, medical examination report.

The one-page cover sheet includes a checklist of forms to be included with the application, basic information about the applicant and a mailing address of where the materials should be sent.

The application itself is three pages long and requires the applicant to fill out personal details, information of the vessel and where it would be navigated, character references, and a record of his or her navigation experience, licensing history and physical disabilities (if any).

A one-page statement of boat handling ability and moral character must be filled out by three independent references, while a physician must complete the applicant’s medical examination report.

Special Requirements

For-hire vessels – unlike boats for recreational uses – are required to have personal flotation devices, ring buoys, fire extinguishers, ventilation of engine and/or fuel compartments, and heating and cooking fuels aboard. All for-hire vessels must also meet minimum insurance requirements (which varies depending on how many passengers the for-hire operator intends to allow onboard).

Full details of the special requirements for charter vessels is available online at

Federal Regulations of For-Hire Vessels

The state’s licensing program is independent of and different from the Coast Guard’s charter requirements.

Recreational vessel operators, per Coast Guard provisions, are allowed to carry up to 12 passengers with no crew and a written charter contract. The passenger limit is dropped to six when those passengers are paying and are aboard an uninspected passenger vessel of less than 100 gross registered tons. Vessels must be U.S.-built or have a MARAD waiver aboard.

Charter vessels are prohibited from carrying 12 or more passengers when moored and without a Certificate of Inspection onboard (including Bed and Breakfast operations).

“The owner of the vessel may NOT be the vessel master or part of the crew. The vessel owner is not allowed on board during a charter,” Coast Guard officials stated in its regulations of for-hire operations. “A bareboat charter contract may not provide or dictate a crew. The charterer must be able to select a crew and have the ability to discharge the crew. The charterer is not considered a passenger, and there can only be one charterer, even though the vessel may be chartered by several individuals. In this case, one person would be considered the charterer and the rest would be counted as passengers.

“Both U.S. flag and foreign vessels may be chartered,” the Coast Guard’s regulations of for-hire vessels continued. “However, foreign flagged vessel cannot carry passengers for hire between U.S. ports and must be chartered and /or operate as a recreational vessel.”

Boat and Breakfasts – Coast Guard Rules

Bed and breakfast operations aboard recreational vessels or houseboats are permitted on federal waters. A “bed and breakfast” is defined by the Coast Guard as an operation “in which the owner/operator/agent receives consideration for people to remain overnight onboard the vessel is a commercial operation.”

Recreational boat owners can offer a bed and breakfast aboard their respective vessels if there is no crew aboard and the 6- or 12-passenger limit is observed. A written agreement (known as a bareboat contract) is also required.

A credentialed master must operate the vessel; Coast Guard safety inspections might also be required.

Coast Guard Fines

Recreational vessel owners who do not comply with the Coast Guard’s for-hire vessel operations (in federal jurisdiction waters) are subject to civil fines of up to $35,000 per day, per operation.


4 thoughts on “California’s For-Hire Charter Licenses: What You Need to Know

  • May 18, 2017 at 11:25 am

    There is a lot more that needs to be said about the requirements for legal charters, whether for six passengers or twelve, or more, particularly with respect to the licensing of the operator and wharfage agreements with marinas and port authorities. This is not a simple subject, and unfortunately there is a considerable amount of misinformation out there. Anyone considering putting a boat into charter needs to do considerable research to make sure it’s done legally and safely!

  • April 11, 2018 at 5:24 pm

    Please direct me to the rules and license requirements for bed and breakfast and charter services for my yacht.

  • March 4, 2019 at 10:05 pm

    No where do you mention you MUST have. Commercial Fishing Licence. CFL – Something I just learned the Very HARD way. Have marine captain license, for up to 90tons. insurance – everything coast guard requires. But no – we get boarded by F&G. On our FIRST 4 pack trip. They find we didn’t know we needed a CFL then F&G took us to jail and impounded my boat.

    Pure extortion. No one ever mentioned CFL.

    JAIL because you didn’t pay $170 for a CFL. WTF???

    • June 28, 2021 at 2:24 pm

      Other than the CFL. What do you need. Captains license insurance.. what else?



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