Shipping Container Investments-FAQ's



  1. Who may invest in containers?
    • Any private individual or legal entity.
  2. Why should I invest in tank containers as opposed to other investments?
    • If you are seeking to augment your existing portfolio by investing in a Euro-hedge investment or seeking an income yield over and above current banking deposit rates then this is an attractive alternative investment vehicle.
  3. What are the main benefits of an investment in a tank container?
    • Durable hard asset investment.
    • Dollar-based asset.
    • No limitation to the number of containers which may be purchased.
    • Capital tax allowances will increase the attractiveness.
    • No obsolescence factor - low tech equipment with strong demand and little maintenance.
    • Investors can invest from 5-20 years depending upon their preference.
    • Tax-efficient.
    • A hedge against Euro depreciation.
    • Useful in pension planning arrangements.
    • Strong residual values.
  4. What am I really buying?
    • An investment in world trade.
    • International currency exposure.
    • Asset base diversification.
    • A long-term income stream.
  5. What is the expected life span of my container?
    • Approximately 20 years.
  6. If I wish to sell my tank container and will there be a demand?
    • Yes, a tank container may be sold but normally a new container will be leased for 5 years so we expect investors to commit to this  this time line and thereafter they may sell if they choose . Demand for second-hand tanks are, and have been, very strong. The benefit to the new investor is that the tank container will already be working in a pool of tanks and income will accrue to the new investor from date of purchase. 
  7. How do I know that my tank container exists?
    • Each container is allocated 3 different numbers, i.e. the Identity Number, an Operational Number, which is linked to the lease manager who will be managing your container, and an International Certification Number issued by one of the certification bureaus such as Lloyds or Bureau Veritas.
    • You will receive a certified copy of the Ownership Certificate.
  8. How much can I expect to pay for this investment?
    • The price of the investment is market-related and is reflected on the Investment Application Form.
  9. Are there any additional costs in respect of shipping and transport?
    • No. The purchase price includes all costs pertaining to the positioning of your tank in the world market.
  10. Is there a danger that the market can become saturated?
    • We believe not, for the following reasons:
      • Stainless steel containers are replacing traditional means of transportation which are systematically being phased out internationally.
      • Current population of tank containers is estimated to grow by 8% per annum.
      • Growth opportunities continue to arise in the US market, South America, the Eastern European markets, Mainland China, as well as the "Pacific Rim" countries and the Far East.
  11. Who manages my container for me?
    • When you decide to make a tank container investment, Tank Invest (Europe) will prepare all the legal documentation relating to the acquisition of the container.
    • In terms of the Agency Agreement, you will appoint Tank Invest (Europe) or one of its agents as your management agent.
    • Tank Invest (Europe) has agreements with various overseas lease managers who will ultimately manage your container on a day to day basis.
  12. Is my container maintained, and if so, who is responsible for the maintenance?
    • Containers are maintained according to strict international specifications and regulations.
    • The lease managers, operators and users maintain the tank containers on behalf of and under the direction of Tank Invest (Europe).
    • Strict inspections are carried out on a regular basis. The effect of this is that tank containers could have an expected life span of up to 20 years.
    • Tank containers may not be operated unless they have been certified by one of the international certification bodies from date of manufacture. Tank containers have to be recertified every 2½ years in terms of International Maritime Standards.
  13. What can I expect to pay for the management of my tank container?
    • The overseas lease managers' fees currently range between 15% - 25% of gross rentals earned from the leasing of the pool of containers.
    • Tank Invest (Europe) has negotiated a maximum fee of 20% of gross income for the duration of the Investor Agreement.
  14. What happens if my tank container is destroyed or damaged while on lease?
    • Your tank container is comprehensively insured for repair or replacement.
    • Your rental income will not be affected as you will continue to earn income from your share of the pool.
  15. What happens to my containers at the end of its useful life?
    • At the end of their useful life (undetermined at this point) tank containers are sold as static storage vessels or for the scrap value of the stainless steel at that time.

TAXATION

  1. What deductions do I get for tax purposes?
    • In terms of current tax practice, the amount of the annual wear and tear allowance in respect of tank containers will be limited, for tax purposes, to the amount of taxable rental income received by investors.
    • The write-off commences from the date of purchase.
  2. What are the tax implications when I sell my tank container and I have already deducted its entire cost for tax purposes?
    • You could have a tax recoupment of the allowance you have deducted up to the date you sell the container. This recoupment is limited to the original purchase price. It would be taxed at your marginal rate of tax in the year in which the sale is concluded.
  3. Is the investment subject to Capital Gains Tax?
    • Most EU countries operate a Capital Gains Tax system. Therefore any gain that may be made upon sale of a tank container by an investor, over and above the original purchase price, will be taxable.

RENTAL INCOME PAYMENTS

  1. How often is income distributed?
    • Quarterly in arrears.
    • Tank Invest (Europe) pays its investors within 60 days from the end of each quarter.
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