N-Reg trustee International Air Services - any experience?

[German guy]

Hi everybody,

I just saw that an aircraft in which I'm interested in is registered in the USA through trough International Air Services as trustee.

Link: index (http://www.faaregistrations.com/)

The website doesn't look too promising but the prices are the lowest I have ever seen, as they charge only £245 per year.
Searching the web for "International Air Services" quite a lot of planes come up which are registered through this company. They also claim that they would be in business since 1978.

Does anybody have experience with this company?

Cheers,

Oliver

[md 600 driver]

Sorry not used them but I have used southern aircraft consultancy ( now near norwich )many times and I can recommend them

[Mark 1]

I use them for the ownership trust on my RV-4 (non-US citizen living in US).

No catch that I'm aware of. Bob Garretson seems a friendly and helpful guy and has responded quickly when I needed to get a new airworthiness certificate (change of limitations).

I certainly intent to stay with them.

[IO540]

It is a company which a number of people I know have looked at, but nobody has (as far as I recall) reached any conclusions.

I know of nothing adverse but it does not appear easy to find others who use it - except the chap above who is the 1st one.

S.A.C. is who I am with. The owner, Warren Chmura, died a couple of years ago in a car crash and IIRC his brother (also a US citizen) is now running it. A year ago I had the occassion to speak to an FAA lawyer about various matters (in a seminar) and S.A.C. came up, along with the general matter of N-reg trusts. The lawyer confirmed that they know S.A.C. well and work with them.

On the old question of the future of N-reg trusts the lawyer said they have no plan to stop the use of trusts, except to stop trusts which try to conceal the identity of the beneficial owner ("trustor" is US speak).

So I would check out whether this trust company complies fully with this, and also whether they provide the other services like the 3-yearly re-reg, obtaining radio licenses, passing on correspondence (and how much they charge for that), etc.

[Mark 1]

My research found over 100 N-reg aircraft in their name. I recognized one as someone I knew, so contacted them to check that all was as it seemed.

They register the aircraft with your name and address, so communications from FAA etc are no problem.

I don't see any reason to pay more.

[Mark 1]

IO540,

I don't think so. I'll check my paperwork later. I just know that they have a US corporation.

Bob Garretson spends most of the year at Long Beach, which was handy for me getting things done quickly.

Sadly, it didn't get me out of paying California use tax

[German guy]

Thanks for your replies so far.
I just figured that it's possible to search for N-numbers by name - 109 aircraft are currently registered through International Air Services:
Click (http://registry.faa.gov/aircraftinquiry/Name_Results.aspx?Nametxt=INTERNATIONAL+AIR+SERVICES+INC+TRU STEE&sort_option=1&PageNo=1)

Southern Aircraft has however more than 500 aircraft registered:
Click (http://registry.faa.gov/aircraftinquiry/Name_Results.aspx?Nametxt=SOUTHERN+AIRCRAFT+CONSULTANCY+INC+ TRUSTEE+&sort_option=1&PageNo=1)

International Air Services Trustee's website is a pain. But then again initially £100 plus £245 is the lowest price I ever heard of for this kind of service. Currently they provide a even lower price for the first year: £99
Click (http://www.faaregistrations.com/special%20offer.htm)

Southern Aircraft charges £450 per year, incl. VAT (International Air doesn't even mention if their price includes VAT).
In relation to the total costs of owning an aircraft, the difference between these two prices is almost negligible. On the other site - why wasting money?

I think I need to do some further investigation on this issue... :rolleyes:

Even if we will not buy this specific aircraft, we are probably going to buy some other N-registered aircraft within the next year, so that this question would come up again anyway.

[Mark 1]

The Long Beach address is a private one, nothing to do with IAS as a company, as far as I know.

I don't know how they define "doing business in a state".
I dealt with them through my UK address, which I still use as a mailing address.

No, I'm not a permanent resident, hence the need to use an ownership trust.

[fernytickles]

I don't know if the rules have changed, but when we first moved here 10 years ago, we set up a Delaware company & registered that as the aircraft owner with us as directors or chairman or ceo's. It was pretty straight forward.

No trustee/trust company or anyone else involved. Just for a Nanchang & a Citabria. Nothing fancy, and I think the company stuff only cost about $75 a year.

[IO540]

I vaguely recall that the individual trust company route requires 75% US ownership, which is normally a bunch of lawyers.

The individual trust company route is used almost universally on upmarket stuff (jets etc) and it protects you from the uncertainty which occurs if/when the trust company owner dies.

When Warren Chmura died, there was a lot of nail-biting. None of the 200-300 N-reg planes owned by SAC could be flown, AIUI, and I certainly did not fly mine.

There may also a general concern about who might end up controlling the company in such a case; some characters in aviation are totally unsavoury. Fortunately SAC came out fine.

[goldeneaglepilot]

So what exactly has happened?

[maxred]

I am with him and found him to be excellent to deal with, and very cost effective. Does everything it states on the tin. First class:ok:

[AC-DC]

IO540 wrote:

When Warren Chmura died, there was a lot of nail-biting. None of the 200-300 N-reg planes owned by SAC could be flown, AIUI, and I certainly did not fly mine.

Why is that? I even didn't know that there might be a problem and kept on flying as normal.

[peterh337]

An N-reg needs to be owned by a US citizen (or some other options; I think a green card holder is ok) and if he dies then the aircraft registration is invalid.

This is why upmarket hardware has individual trust companies where 75% of the share capital is owned by several US lawyers and 25% by you. That also meets the requirement, and if one of the lawyers kicks the bucket they just stick another one in there. If you kick the bucket, you don't care anyway, but the reg is legit because the ownership is now 100% US :E so the plane can be flown, sold, etc.

The only downside of the US trust stuff is that - the way the trust is normally worded - while the trustee cannot stop you enjoying the aircraft, he could (if bloody minded) stop you selling it.

In the past, some trusts gave you a pre-signed bill of sale (which in effect can be used to kill the trust by you and the trustee cannot stop you) at the outset but fairly predictably this renders the trust void and this was confirmed by an FAA lawyer I went to a while ago. The FAA said they had a good relationship with SAC and are entirely happy with their trusts etc. Obviously they would not give names of trust companies whom they didn't like...

[AC-DC]

Hmmm, thanks.

I worked with Warren and now with his daughter, found them both very helpful, honest and easy to work with and would not hesitate to recommend them.

[Azaiba]

I would suggest that it is wise to have a legal professional look over any legal document before you sign it. The downside with International Air Services is that they will not let you see the trust agreement before you have paid for it.

[maxred]

What do you mean 'full of holes'and whose trust??

[peterh337]

If true, that is absolutely horrid.

How was it resolved?

[maxred]

Yes, that sounds not good. I can only give you my experience and that was excellent value for money, and the trust delivered everything I required at an extremely competitive price. My experience.

If anything changes I will post accordingly.

[freedomoftheair]

When there is a FAA Trust company, the company typically enteres into the contract yearly with a yearly payment. Should the Trustor wish to not renew his Trust by non payment of the yearly Trust fee, than the Trust company, no longer being in contract, resigns as Trustee. Most companies wait many months to see if the Trustor wishes to pay for his Trust. When the Trust is not renewed, the aircraft reverts back to the non American owner. When there is a non American owner, the FAA de-registeres the aircraft. If at a later date well past the termination of the Trust, a Trustor instructs his old Trust company to execute documents dated past the termination of the Trust, Trust companies typically ask that the arrears be paid. The FAA also de-registers aircraft owned by American citizens and corporations when the FAA sends the registered party a notice to re-register their aircraft and the FAA re-registration fee is not paid.

[peterh337]

Interesting post...

When the Trust is not renewed, the aircraft reverts back to the non American owner. When there is a non American owner, the FAA de-registeres the aircraftAs an aside, how does the FAA find out? Presumably only if the Trustee tells them.

This came up on the other thread, regarding Graham Hill, whose N-reg Aztec had at some point become de-registered. I thought it was possibly caused by somebody in the Hill camp applying to the FAA for an Export CofA (but not preceeding with it) but now that you mention it it could have simply been a non-payment of the trust fee followed by a lack of communication.

[Bob Upanddown]

Surely this is now sorted by the expiring Certificate of Registration?

Trust not renewed, C of R eventually expires, aircraft de-registered automatically.

As I recall, the purpose of the expiring C of R was to weed out aircraft that should have been de-registered but no-one bothered. I guess many of those were aircraft involved in trusts.

[peterh337]

I think you will find that the vast majority of those aircraft were in the bog standard US GA fleet, scrapped over the past 5-6 decades, but never de-registered.

The US GA scene is huge (much bigger than the rest of the world combined) and nearly all of it is simply privately owned.

A very small % of the N-reg fleet is under trusts.

[maxred]

About three years ago the FAA undertook a massive exercise to sanitise the data base. They had so many aeroplanes on the register, the vast majority of which had been scrapped/sold but not de-registered. As Peter highlights, this over at least 50 years. My understanding is that the exercise has been completed, however I am sure some anomolies will still exist.

[peterh337]

What are the relevant dates of this correspondence?

It is true that a Trustee can prevent you selling the plane. There is no way to protect yourself from that, and there is no way to take out insurance against it.

[Bob Upanddown]

Yes there is.

You ensure that the Trustee signs a bill of sale selling the plane back to you and leave it undated.
Any problems with the Trustee and you date the bill of sale and send it to the FAA whilst arranging a new trustee.

[peterh337]

You ensure that the Trustee signs a bill of sale selling the plane back to you and leave it undated.

The FAA lawyer I went to (presentation of) specifically stated that these are illegal.

I suppose that if you get one, privately, they have no way of knowing you've got one...

[goldeneaglepilot]

Out of Interest, what has happened to the aircraft? Are all the issues sorted and it's now flying?

I guess there are always two sides to every story. I was sent an email from IAS, I copy below part of the content.


The fact is that Axxxxxx, having decided to sell his airplane, decided he did not have to pay for his Trust in spite of 3 invoices. After nearly 6 months in arrears, I simply informed the FAA in writing that our company was no longer responsible for Axxxxx's aircraft as Trustee. The FAA than de-registered the aircraft just as they do when you do not pay the FAA their $5.00.

Southern has de-registered airplanes in the past and informed the FAA that it is to be exported to the U.K. and other countries. I did not do that. If I had, the FAA would have wired the CAA that the aircraft was de-registered for registration with the CAA. It would have created a technical invalidation of the airworthiness certificate. And if I had, Axxxxx would have had to involve the CAA because the FAA would have required the CAA to inform the FAA that the aircraft was not registered by the CAA. Axxxxx just guessed that is what I must have done.

After the FAA de-registered the aircraft, Axxxx wrote a bill of sale FAA form 8050-2. I knew the FAA would not accept that because their was no bill of sale form from IAS to Axxxxx.

Axxxxx said that if I insisted that he pay his past due amount on his Trust, that he would pass bad information about my services to my clients. It was after that threat when I resigned from being his Trustee and informed the FAA that I was no longer responsible.

Axxxxxx could pay a FAA title company and get a copy of the letter I wrote in which I stated that I resigned and the aircraft no longer met the citizenship requirements.

After Axxxxx paid, I issued a bill of statement to him as he already issued one to an American corporation to complete the required FAA chain of title.

I talked to my lawyer, my lawyer said to give him a bill for his advice but I did not.

I informed Axxxxxxxxx in writing in advance of doing so that failure to pay his Trust invoice would result in my resigning and in his aircraft being de-registered. He wrote me that I could go ahead and de-register his aircraft as he was not going to pay his invoice even when I put in writing that he need pay no late fees or anything else, just his 245 GBP. He refused in writing to pay.

[maxred]

I guess there are always two sides to every story. I was sent an email from IAS, I copy below part of the content.

Precisely.

I have found IAS, easy to deal with, and as I stated earlier, does what it says on the tin:)

[goldeneaglepilot]

Out of interest anyone have any ideas about the Trustee services offered by Robert Weaver of Skyferry, he claims to have twenty aircraft in trust yet a search of the FAA database shows no mention of him or his company?

[peterh337]

There are quite a number of individuals who have at various times in the past been offering trustee services.

Not all of them distant from "Suffolk" :) I wonder who he/she is?

[freedomoftheair]

A couple of hundred other pilots Trust IAS, some with private companies that IAS offers. And a couple of people who vent their spleen in public merely because they do not like to pay their bills is not the rule.

[goldeneaglepilot]

Freedomoftheair - my thoughts as well. You have always done what you have said, no one could ask any more than that.

My question really relates to the Trust scheme Weaver claims to run?

Here is a bit of free publicity for Weaver!!

21/03/2012: Today marks the day of our 20th aircraft that has been placed in our N reg Trustee Service for owners and operators outside the US who wish to maintain their aircraft on the American register whilst operating outside of the US as a non US citizen, or organisation. Our simple and fair price Trustee services could also be of use to you on your next N reg purchase or registration transfer

N Reg Trustee
Are you looking at buying an American (N) registered aircraft? The United States has more aircraft manufacturers and available pre-owned aircraft for sale than any other country in the world, add the favourable exchange rate between the GBP/Euro over the USD and it is clear to see that you can get much more for your money.

Keeping you aircraft on N register also allows you to exercise your FAA licenses and ratings in your aircraft in your country of operation, operating costs are also usually cheaper compared with JAR registered aircraft.

Unfortunately to accept ownership and title of a US registered aircraft you must be a US Citizen or permanent resident (FAR 47.2), for non US Citizens or firms the easiest way to comply with this law is to employ a US registered trustee to take legal responsibility for your aircraft whilst you act as the beneficiary, which now allows you to own and operate the aircraft, indeed the trustee is just a legal clause to allow you to do this. We offer this service which allows you to own and operate your aircraft without violating federal laws. As a reputable and well established ferry firm we can also assist in delivery, please contact us (http://www.sky-ferry.com/index.php/contact-us/) for a free no obligation quote.


With our legal knowledge and understanding of how to import your aircraft, we keep everything legal whist complying with federal and local laws. It is vital when selecting a Trustee / Holding service that you use a company that complys with the required regulations, we have seen and continute to see, registration certificates revoked and beneficiarys violated, for this reason alone don't leave it to "Uncle Sam" to look after your asset, use a reputable and protected (Ltd or LLC) registered Trustee/Holding firm such as Sky Ferry.

Hot Topic Questions

Q: Can I transfer the title when I sell my aircraft?
A: Yes, we charge £500GBP for this service unless stated.
Q: I have a US friend / family member, can they act as Trustee?
A: Remember we act as a legally bound Trustee, is your acting friend or family member protected against limited liability, also do they have in depth legal knowledge, and finally are you willing to take that risk with your investment?

[Lurcherman]

Having known and done business with Bob Garretson since 2001 I know who I believe.
If a client refused to settle a legitimate invoice for a paltry £275 then I would suggest it was not unreasonable for IAS to withdraw their services.

Threats to blacken someone's reputation on a web site such as pprune should be seen for what they are.

As someone else said, with Bob you get what says on the tin.

American trust services at a fraction of the cost of his competitors.

Pay your money, take your choice.

[Ebbie 2003]

I have my PA28-181 with Southern Aircraft Consultancy

I found their service to be excellent especially in light of the airplane being in New Jersey, SAC in Norfolk, me in Barbados and of course the FAA in OK City - they coordinated everything including my 'radio station licence' (don't forget that!)

All in all a painless experience - they even send out alerts for problems - got one last week giving a reminder/warning about the Olympic's exclusion zone - some poor guy wandered into it it would seem - not comething I am going to do but a nice bit of customer care and I am sure very timely and valuable to those flying in the region.

I did look at using other firms for my trust but response times were long - Faith at SAC responded immediately even though she was on holiday at time - the wonder that is the Blackberry I suspect.

[piperboy84]

[QUOTE][
Sadly, it didn't get me out of paying California use tax/QUOTE]

Shoulda put a Vegas P.O. Box on the bill of sale, no point paying California "use" tax if you ain't gonna "use" it in California