FAA and overseas N-reg changes?

[Fly Stimulator]

I have heard a rumour that the FAA is getting unhappy about the number of N-registered aircraft that are permanently kept in Europe. There is a suggestion that they have raised this with EASA who in turn have talked with the CAA about something along the lines of the recent DGAC ruling stipulating that after six months an aircraft has to go onto the national register of the country where it actually lives.

I'm hoping that this may prove to be unfounded. Does anybody know anything about it?

[S-Works]

I have heard the same comments made by my maintanance company. I believe a lot of the reason has come from a number of aircraft that carry an N tail marking but are not actually registered anywhere.

It may also be an attempt to reduce the amount of N reg IFR traffic with the possile advent of the JAA/EASA IR light.

[IO540]

I have heard this rumour variously over the last 12 months but absolutely nobody has had any detail.

It would upset a HUGE number of operators around the world, not just the few PPL/IR pilots in the UK etc. There are a lot of N-reg cargo operations, and many corporate jets are on it.

I am sure somebody (e.g. a 3rd world country) would pop up offering an alternative registry. It's an easy way to make money for pushing paper about. It already happens with certain cargo operations (Liberian reg). A lot of corporate jets are on Cayman Islands (who - I am told by one "customer" I know - accept FAA licenses readily).

I doubt the FAA would stop foreign resident planes. Far more likely, the non-US authorities will stop N-reg planes resident there for > N months. The USA already does that !!

[Evo]

It may also be an attempt to reduce the amount of N reg IFR traffic with the possile advent of the JAA/EASA IR light.


What's this then?

[Cathar]

My understanding is that US law already prohibits non US citizens from owning an N reg that is based outside of the US. This is why UK owners have to have their aircraft owned and registered US trustees. I have heard from contacts in the FAA that they are not happy with the use of trustee arrangements to breach the intent of the US law. However, it is unlikely that they have raised the issue with EASA as at the moment EASA consists of little more than the managment board and director general and has more pressing issues to deal with.

I understand that the Department for Transport and CAA have been in discussion over this issue following the grounding of N reg corporate jets at Luton over licensing issues. It would not surprise me at all if they were considering something along the lines suggested by IO540. I believe that a number of states in addition to France and the US already have such requirements

[Flyin'Dutch']

This rumour is as old as the road to Rome.

What is true is that the French are looking to see if they can stop permanent resident N-regs in their jurisdiction.

I think you can probably still sleep soundly tonight if yours is on the N in Euroland as there are some big players around who operate on the N (amongst them some flag carriers) who would get a bit upset if they had to change their ways.

FD

[IO540]

Cathar

Presumably you are unable to be specific about who your FAA contacts were, but I can equally say I have heard lots of things from "contacts at the CAA", e.g. one CAA CofA inspector told me they want to stop "trial lessons" (which are really in most cases a straight pleasure flight but circumvent the need for an AOC, so the CAA loses the fat AOC license fee). This would put many schools out of business. So many people in these organisations feel especially important when talking to others privately. I have heard some other stories so bizzare they are best forgotten, from a CFI who claimed to be "close to CAA sources", etc.

The corporate jet grounding (discussed on another thread at pprune) apparently concerns a situation where neither of the pilots had the proper license for the aircraft - not related to "non-US N-reg" operation at all really, as I understand it.

[Justiciar]

bose-x

JAA/EASA IR light

What is "IR light"? Are we finally going to get a sensible PPL/IR standard in Europe?

[Cathar]

IO540

I agree that you have to be careful about taking things at face value (especially if you read them on the internet). The person who mentioned these concerns to me is well informed. reliable and has no need to prove his importance. All I said in my post is that I have heard concerns expressed which backed up the information on the original post. I did not speculate whether or not this would be translated into action, certainly I have not heard anything to that effect nor did I suggest that I had.

The situation at Luton is relevant. At least one of the aircraft grounded is based there and owned on trustee basis by a UK citizen (or company?). I am told that the Department of Transport (who initiated the inspections at Luton) are getting very interested in the issue of foreign registered aircraft based in the UK (other than for airline operations). As they have recently taken on the US fractional ownership industry I don't think that they are likely to be worried about upsetting a few private/corporate operators.

Time will tell.

[S-Works]

I am told that there is a review taking place that could lead to the introduction of a Europe wide IR for PPL holders that does not require the excessive exam work currently required to obtain a JAR IR. I am led to believe that the ultimate goal could be something in the way of a "super IMC" and recognised by all JAR/EASA participants.

It is still early days but with any luck........

[IO540]

Cathar

Do you have any info about this fractional ownership problem?

For example I know you have to operate an N-reg under a dry lease to make it legal to rent it. So Joe Bloggs doing it privately is probably OK, whereas if a fractional group or a rental operation gets it wrong, they're in trouble.

But any U.S. registration agent can come up with the right paperwork - it is for the operators to stick to it (or not).

The U.S. trust route isn't illegal anywhere; I know a man (as the yellow pages ad says :O ) whose son is a US citizen and it is his son who actually owns the plane. This is the same thing as a Trust but obviously is a lot cheaper! And, like the trust, the son could run off with it.

[Cathar]

IO540

As I understand it the DfT view is that under UK legislation managed flexible ownership schemes such as that operated by NetJet are public transport operations. They therefore need a permit from DfT to operate into the UK. To get a permit you need to operate under an AOC. The US flexible ownership operators generally do not have AOC.

I accept the trust route is not illegal. But it is designed to allow you to do something that the law is designed to stop you doing.

[IO540]

Cathar

Having looked into the issue of flying on business on a PPL (very common) my understanding is that the test is whether the pilot is employed by the company on whose business the flight is made. The answer must be YES.

And the PPL can recover the FULL cost of the flight, not just the PPL cost-share bit.

The above is true for both G-reg and N-reg, in the UK.

Otherwise, the pilot needs a CPL and the owner/operator needs an AOC.

Perhaps this is where they failed?

If the flight was for a business purpose, and the pilot(s) were not employees of the business ....

If the flight was for a private purpose, then the pilots could only recover the PPL cost share bit, otherwise a CPL+AOC is again needed.

Is this right?

[flyingfemme]

Ownership of an FAA registered aircraft by a trust arrangement does not actually have anything to do with the geographical location of the craft. It is a means of allowing "ownership" of said FAA registered beast by somebody who is not a US passport holder, a legal US resident (greencard holder) or a US Corporation. The fact that most are situated outside the 48 contiguous is mere coincidence.

[Fuji Abound]

I can confirm that an EASA IR light is on the agenda.

[IO540]

Something like that has been on somebody's agenda for years, and it's never happened.

In case this is real, would you know what the likely ground school and medical requirements are likely to be?

[chrisbl]

They could not do any worse than follow the FAA IR programme. At least then there would be consistancy of pilot qualifications flying IFR.

On the original post, the main issue seems to be the potential for putting navigation charges onto pilots. If more could fly IFR it would be a great way of raising income.

[Cathar]

Ownership of an FAA registered aircraft by a trust arrangement does not actually have anything to do with the geographical location of the craft. .......The fact that most are situated outside the 48 contiguous is mere coincidence.

I disagree that the trustee arrangements do not have any relationship to the geographic of the aircraft and it is mere coincidence that the majority of N-Reg aircraft registered by trustees are based outside the states. The trustee arrangements are designed to allow individuals and companies which are not qualified to register aircraft to do so. These are usually non US citizens who are not resident in the US or non US companies who do not do the majority of their flying in the US.

IO510

I was little confused by your question then I am often confused. I assume that you are trying to relate this to the US fractional ownership schemes but they do not fit in with the scenarios you describe. Under these schemes you buy a share in an aircraft but the aircraft is managed and operated by the company which markets the scheme. The aircraft managed under the scheme are pooled (and this could be several hundered aircraft) and when you call on the services of the aircraft it is very unlikely that you will fly on the aircraft which you own a fraction of.

[2Donkeys]

Those who are suggesting that some form of IR Lite (also known as the IWR, and Euro-wide IMC rating etc etc etc) is already on EASA's agenda need to re-read EASA's mandate.

EASA has currently been empowered to look a the licensing of aircraft and aircraft-related products, so as to avoid the issue of multiple Type Certificates for an Aircraft by each member country. This should dramatically reduce the time to certificate new types - and is of potential huge advantage to aircraft manufacturers.

For the time being, EASA has neither the mandate, nor the staff to look at Flight Crew licensing, although this is anticipated at an unspecified future date once appropriate legislation can be agreed, formulated and passed in each member country.

The IR Lite/IWR debate is old and very dead at the moment so far as both JAA and EASA are concerned. Anybody who attempts to suggest otherwise is passing on vintage rumours as FD says.

[IO540]

Cathar,

Re the trust ownership: something is either legal, or is not. If e.g. the FAA requires the plane to be owned by a US citizen, or a US registered corporate body, that is what you have to comply with and when you've done that, you are legal, by definition. The fact that it is actually flown by some person in the UK does not breach the US law. It may not be what the FAA originally intended but it is for them to change the law. They've had many years to do it, and they haven't done it yet. Perhaps (like the CAA and everybody else who issues bits of paper with "License" or "Certificate" on them) they like the money? :O

Thanks for the fractional ownership description. I do think however that this (the ownership of the plane) does not affect whether it is a Private Flight. What affects it is the use to which it is put. If the CAA grounded some bizjet, the question is who were the pilots employed by?

[Cathar]

IO540

I have never suggested that trust ownership is illegal. All I have done is point out that it is a device used to circumvent the law. As such it something that one might well expect the FAA to be unhappy with. Yes, the FAA could have changed the law but haven’t so far. However, changing the law, especially if it is primary legislation, is never easy and FAA may have had more important issues to deal with. But it seems to me that if trust ownership is becoming more prevalent this is likely to raise the issue in the FAA’s order of priorities.

The issue of what constitutes public transport is not something on which I would like to give advice on - my brain hurts whenever I read the definition in the ANO. However, it is worth pointing out that the ANO definition of public transport only deals with activities by G-reg aircraft. The requirements for foreign aircraft are much simpler. The ANO requires that they shall not take on board or discharge any passengers or cargo in the United Kingdom where valuable consideration is given or promised in respect of the carriage of such persons or cargo, except with the permission of the Secretary of State granted to the operator or the charterer of the aircraft or to the Government of the country in which the aircraft is registered. 'Valuable consideration' is defined as any right, interest, profit or benefit, forbearance, detriment, loss or responsibility accruing, given, suffered or undertaken pursuant to an agreement, which is of more than a nominal nature.

[IO540]

Cathar,

"I have never suggested that trust ownership is illegal. All I have done is point out that it is a device used to circumvent the law. "

The two sentences above are contradictory! Especially as we do not know whether the originators intended to restrict N-reg to US residents.

Everyone thinks that the FAA does not like non-resident N-reg planes, but it could well be that actually they quite like it... Let's face it, the UK CAA would be absolutely delighted to receive the money the FAA gets from these operators. I've just paid £20 for my aircraft radio license; it must be barely worth collecting such petty amounts, against the admin costs.

"The requirements for foreign aircraft are much simpler. The ANO requires that they shall not take on board or discharge any passengers or cargo in the United Kingdom where valuable consideration is given or promised in respect of the carriage of such persons or cargo..."

It appears that it is OK for an N-reg pilot to do what many of them have always done: fly on their own business, without being contractually required to fly and without being paid specifically for flying. Same with G-reg. What neither can do is get someone to act as PIC who isn't employed by their business.

A friend used to work for a large US firm (in the USA) and they had a fractionally owned King Air, twin turboprop. The plane always turned up with two pilots, ready to go. No way to do that in the UK without an AOC.

Incidentally, I have received from the CAA a PDF called "SUMMARY OF THE MEANING OF PUBLIC TRANSPORT & AERIAL WORK" - not sure where to put it here (could email it). It contains a good description. I'll be away for 4 days now.

[Cathar]

"I have never suggested that trust ownership is illegal. All I have done is point out that it is a device used to circumvent the law. The two sentences above are contradictory!"

I do not see what is contradictory about these sentances.

You cannot legally own an N-Reg aircraft. So you buy one and place it in the hands of a trustee which becomes the legal and registered owner of the aircraft. The trust then allows you to operate the aircraft. The sole purpose of the trust arrangement is to allow you to do something that you could not otherwise do. If this is not circumventing the law I do not know what is. But I fully accept that it is legal.

I don't think that I have disagreed with you on the issue of public transport because it if not a subject I claim to know a lot about. I have just made a few rather obvious statement. I have probably got a copy of the CAA advice on it somewhere. However, this is based on the definition of public transport contained in article 130 of the ANO and the term public transport is not used in article 113 of the ANO. Therefore any provisions of article 130 which deem certain flights to be private flights notwithstanding the fact there is some valuable consideration is given are not relevant to the requirements of article 113. So a situation which is defined as a private for a UK registered aircraft may come within the requirements of article 113 and need a permit.

Have a good trip.