A special flag, looking like the national flag and ensign but with a fouled anchor in a circle of stars in the canton, was created by Act of Congress in August, 1848 as a flag to be used by licensed U.S. yachts. This was apparently not intended to be an ensign, but rather was intended to be used as a signal flag by a licensed yacht to declare herself exempt from customs duties, and its usage was required by licensed yachts. Due to its similarity to the national ensign, however, both licensed and unlicensed yachts started using this as the ensign, and eventually the US government confirmed that it would accept this practice for yachts in United States waters; but the national flag is the only ensign allowable in international or foreign waters. The existence of the Yacht Ensign in United States statute (46 U.S.C. section 109) was repealed by the Vessel Documentation Act of 1980 (Public Law 96–594), which removed several legal provisions pertaining to the by-then obsolete category of “licensed yachts.” Nevertheless, the yacht ensign is still widely flown by U.S. yachts and pleasure boats today, continuing a tradition that dates back to the mid-19th century.
