'Non-Equity' Groups
Thread Starter
Joined: May 2005
Posts: 1,115
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From: Yorkshire
'Non-Equity' Groups
Owner of 4 seat light aircraft with EASA C of A and engine 'on condition' (past it's calendar life) invites pilots to join a 'Non-Equity Group' where 'Members' (who are not joint owners) pay a monthly fee, and a rate per hour.
Legal, or not?
MJ
Legal, or not?
MJ
Last edited by Mach Jump; 13th May 2014 at 19:18.
Joined: Sep 2012
Posts: 160
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From: London
Non-equity group is effectively rental, and the aircraft need to be maintained to public transport standard. The only potential problem I see with your situation is "on condition" - not sure if CAA allow this in public transport category. But I'll be quiet now, let someone wiser clarify that.
/h88
/h88
Joined: Aug 2013
Posts: 5
Likes: 0
From: Derby
Non-equity groups are not legal in the UK. The CAA allow up to 20 people to jointly own shares in a group, so the minimum value of a share is 5% of the aircraft. Shares do not have to be equal, but each member of a group must own at least 5% of the aeroplane.
If you do not own a share of the aeroplane (a non-equity group), you are effectively renting the aeroplane. For a rented aeroplane, the component times (eg. engine) must be within the manufacturer's stated 'Time Between Overhaul' period, which is usually 2400hrs and/or 12 years (dependent on engine and manufacturer). A 20% extension (2880 hrs or 14 years) is allowed provided certain conditions are met, eg. no metal in the filters etc..
If the same aeroplane is in group ownership (i.e. not rented) then the engine can carry on indefinitely 'on condition'. This would not apply in this case.
In summary, therefore, don't get involved in a non-equity group. If nothing else, you have no legal claim on the aeroplane and would not be able to claim anything back were it sold or disposed of.
If you do not own a share of the aeroplane (a non-equity group), you are effectively renting the aeroplane. For a rented aeroplane, the component times (eg. engine) must be within the manufacturer's stated 'Time Between Overhaul' period, which is usually 2400hrs and/or 12 years (dependent on engine and manufacturer). A 20% extension (2880 hrs or 14 years) is allowed provided certain conditions are met, eg. no metal in the filters etc..
If the same aeroplane is in group ownership (i.e. not rented) then the engine can carry on indefinitely 'on condition'. This would not apply in this case.
In summary, therefore, don't get involved in a non-equity group. If nothing else, you have no legal claim on the aeroplane and would not be able to claim anything back were it sold or disposed of.
Joined: Aug 2003
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From: Not a million miles from EGTF
Non-equity groups are not legal in the UK. The CAA allow up to 20 people to jointly own shares in a group, so the minimum value of a share is 5% of the aircraft. Shares do not have to be equal, but each member of a group must own at least 5% of the aeroplane.
These groups are sometimes run as companies so none of the members actually own anything, but have a shareholding in the company.
Joined: Aug 2013
Posts: 5
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From: Derby
Non Equity Groups
Yes, I'm sure that non-Equity groups (which include groups that run as businesses with shares, and are therefore still aeroplane-hiring 'companies') are not legal in the UK! When registering an aeroplane with the CAA, all members of the group should be listed on the certificate of registration. Sometimes the aeroplane is registered to the trustee of a group, and he is the point of contact with the CAA. However, all members should still be on the certificate of registration for it to be a legally-operated group. So, if a share changes hands, a new certificate of registration must be applied for and the insurance company informed.
