Courtesy Flag 

It is customary, but not obligatory, when visiting the waters of another country, to fly from the senior signaling position, the maritime ensign of that country as a mark of courtesy.

Ensign

A UK flagged vessel must wear her ensign as required by the Merchant Shipping Act, which includes when entering or leaving a foreign port and on demand. It is recommended that the ensign is worn at all times in daylight, especially when near to or in sight of land or another vessel.

Courtesy Flag

Although a custom rather than a legal requirement, most countries expect that a courtesy flag (a small version of the coastal state’s ensign) should be hoist by foreign flagged vessels as a signal, acknowledging that they are in foreign territorial waters.

You may come unstuck in some countries if your courtesy flag is tatty, too small or not there at all. In some instances – such as the UK – the maritime ensign is not identical to the national flag. 

The courtesy flag should be flown as a signal. On a single masted yacht the correct position is as the upper most flag at the starboard crosstrees.

If a motor cruiser does not have a dedicated signal halyard, a prominent position such as the VHF aerial is commonly used as a substitute.