legal

NAFA member, Stephen Hofer, President, Aerlex Law Group, discusses the FAA's document processing delay and its' impact on the business aviation industry.

Unfortunately for all of the folks in the business aviation industry – the would-be sellers and buyers, the brokers, the escrow and title companies, the specialty lenders, and the aviation transactional lawyers – something Santa Claus cannot load onto his sleigh is more skilled bodies and technological tools to magically alleviate the long-standing paperwork processing backlog at the Federal Aviation Administration’s Civil Aircraft Registry in Oklahoma City that has now stretched out to a full half-year.

This backlog doesn’t stop transactions from occurring. Bills of sale, aircraft registration applications and other related documents needed to transfer title from seller to buyer still get filed with the Aircraft Registry, the security agreements and aircraft mortgages that protect a lender’s interest in the collateral still go into the filing bin – but the critical distinction is that they have not actually been permanently recorded – they have simply been submitted and are “works in progress” (WIPs in FAA parlance), waiting for an examiner to review the documents and determine whether they are in proper legal form and eligible for recording. The actual recorded documents do not become a part of the FAA’s permanent database until six months later – and that delay can create a number of complications.

For example, the title transfer process begins when a seller delivers an FAA Bill of Sale (an AC 8050-2 form) to a buyer, who then files the Bill of Sale, along with an Aircraft Registration Application (an AC 8050-1 form) that will, in turn, trigger the issuance of a permanent Certificate of Aircraft Registration (the AC 8050-3). The 8050-3 is the permanent “hard card” the owner places onboard the airplane and produces for inspection if the crew is ever ramp-checked by the FAA or any other law enforcement agency. In the meantime, the owner carries a copy of the 8050-1 onboard and this allows the owner to legally operate the aircraft (inside the United States only) while waiting for the permanent certificate. This process has existed for years and generally never caused any problems because the 8050-3 was normally issued in six to eight weeks. However, the dilemma that has arisen as a result of the FAA’s protracted processing delays is the fact that an 8050-1 only allows an owner to operate the airplane for 90 days before it expires and has to be renewed, a new filing which further exacerbates the FAA’s processing problem. The agency has said that, effective January 1, 2024, it will allow 8050-1 forms to be used for 12 months or until, hopefully, the 8050-3 finally arrives in the owner’s mailbox.

Read full article here

This article was originally published in BusinessAir Magazine, December 2022, Volume 32, No. 12.

NAFA member, David G. Mayer, Partner at Shackelford, Bowen, McKinley & Norton, discusses owner privacy in business aviation.

Business aircraft owners around the globe constantly risk exposure of their personal information on the ground and in the air. The consequences could result in threats to their safety and security or cause the loss of opportunities for them or their enterprises. For large corporations, even the optics of operating business aircraft may invite unwanted public scrutiny.

In light of these risks, aircraft owners and operators (owners) should, with their best advisors, apply technology tools to thwart breaches of privacy, create legal ownership structures to protect their identity, and implement security and aircraft use plans to mitigate these risks. They should also monitor and adapt to changes in laws that affect access to personal information, such as the FAA’s controversial pivot on December 12 to enhance privacy—at a potentially burdensome cost.

Read full article here

This article was originally published in AINonline on January 13, 2023.

On January 23, 2023, the FAA’s final rule to increase the duration of aircraft registration from three to seven years went into effect.  NAFA member, McAfee & Taft aviation attorney Scott McCreary, who also chairs the NBAA’s Regulatory Issues Advisory Committee, was interviewed for an article by the NBAA on what this change means for aircraft owners and operators.

“The direct final rule is an excellent solution by the FAA to address the aircraft registry backlog problem,” said McCreary.  “It will reduce the churning of the documents that was required before to renew aircraft registrations on a more frequent basis.”

The FAA is currently in the process of issuing new registration certificates to those impacted by the new rule, beginning with those whose registrations are set to expire first.  Owners of aircraft whose registrations were originally set to expire before June 30, 2023, should expect to receive their new registration documents by the end of March 2023.

Read full article here

This article was published in NBAA, January 30, 2023.

Contact Information:  

Tracey Cheek 
tlc@nafa.aero  
405.850.1292  

Elizabeth Okoro 
Business Development Manager 
Crowell & Moring LLP 
eokoro@crowell.com 
202.688.3486 

NAFA Welcomes New Member: Crowell & Moring LLP 

National Aircraft Finance Association (NAFA) is pleased to announce that Crowell & Moring LLP has recently joined its professional network of aviation lenders. Crowell & Moring is an international law firm with specific knowledge to address the complex business, regulatory and tax issues related to aircraft ownership, leasing, financing and operations.  

“NAFA members proudly support businesses designed to facilitate the aviation lending process, and we are happy to add Crowell & Moring’s and their knowledge and experience in legal services to our association,” said Jim Blessing, President of NAFA. 

About Crowell & Moring: 

Crowell & Moring LLP is an international law firm with offices in the United States, Europe, MENA and Asia. Drawing on significant business, industry, government and legal experience, the firm helps clients capitalize on opportunities and provides creative solutions to complex corporate and transactional, litigation and arbitration and regulatory and policy issues. The firm is consistently recognized for its commitment to pro bono service and its programs and initiatives to advance diversity, equity and inclusion. 

Crowell & Moring’s extensive experience is a valuable resource for anyone involved in business aviation. Recognized as some of the top aviation lawyers in the United States, their practitioners actively speak and write on aviation topics and contribute their knowledge to aviation associations and industry seminars. In addition, Crowell & Moring lawyers have held positions at the Department of Transportation (and its predecessor, the Civil Aeronautics Board) and the Federal Aviation Administration. 

Crowell & Moring supports business aviation clients with: 

1. Purchase, sale and finance of aircraft, engines and other aviation and aerospace assets and businesses. 

1. Business aircraft ownership and operations structuring, including related tax planning. 

1. Negotiation of agreements involving maintenance, equipment and other goods and services, aircraft completion, airport access and hangar use and charter transportation and crew employment. 

1. Licensing and regulatory compliance for manufacturers, MRO facilities, FBOs, air carriers, business and public aircraft operators, drone operators, training schools and transactions involving the purchase and sale of such companies. 

For more information, visit https://www.crowell.com/. 
 

About NAFA:  

The National Aircraft Finance Association (NAFA) is a professional association that has been promoting the general welfare of aircraft finance for 50 years. Our network of members is comprised of lenders and product service providers who work together to finance general and business aviation aircraft. NAFA sets the standard for best practices in aviation finance by educating its members with the most up-to-date industry trends and best practices. Government legislation, market influences and industry insights allow member companies to provide the highest quality services the industry has to offer. The company now has three offices: Geneva, New York City and Dubai.  

David Vandenberg, Chair of the NAFA Transactional Integrity Working Group, discusses cybercrime and Business Email Compromise (BEC).

Be careful not to fall victim.

Fraud involving wire transfers is frightening and possibly more common than you think. Business email compromise (BEC) is the common name for this type of cybercrime, which is exceedingly difficult to halt with technical measures and frequently impossible to undo should an attacker successfully fool a target into sending money.

Employee and customer vigilance is essential for stopping these attacks. The following three details will outline the magnitude of the issue and assist you in avoiding becoming a target of these attacks.

Fact #1: Since 2013, There Have Been Massive Financial Losses.

Since October 2013, BEC, also known as email fraud and email account compromise (EAC), is being monitored both domestically and internationally by the U.S. Federal Bureau of Investigation (FBI). The following current fraudulent wire transfer patterns are concerning:

• Tens of thousands of complaints are made concerning BEC fraud each year, with billions of dollars in losses as a result.

• More than 150 nations and all 50 states in the United States have received reports of BEC frauds.

• Consumers may also be impacted by these attacks, which don't just target businesses and organizations. Examples include BEC schemes that target all parties involved in a real estate transaction, including buyers, sellers, and agents, according to the FBI.

Furthermore, it's critical to understand that BEC attacks involve more than just wire fraud. In order to commit tax fraud and other crimes, for instance, cybercriminals exploit illicitly obtained tax information (such as W-2 statements of American workers). In a different kind of BEC fraud, fraudster impersonate employees in an effort to deceive payroll offices and payroll service providers into diverting direct deposits so they can steal workers' wages.

In conclusion, BEC attacks are pervasive and have an impact on both individuals and enterprises. And while though billions of dollars in damages are now estimated annually, the actual amounts are probably higher because BEC attacks sometimes go unreported. Don't fall into the trap of believing it won't happen to you; cybercriminals target consumers as well as employees and search up, down, and across org charts to discover their targets.
 

Fact #2: BEC Attacks Use the Comfortable to Trick You into Making Poor Choices.

Since BEC attacks are designed in such a way, technical tools are frequently ineffectual against them. Typically, emails don't contain malicious links or attachments, two characteristics of phishing attacks that email monitoring technologies can spot and reject.

BEC attacks, in contrast, make an effort to "glide under the radar," using well-known identities and details to pass for secure, authorized communications. Attackers may use social media and other public information sources to learn more about their targets. They may also establish rapport across several contacts—by phone and email—to make the target think they are speaking with a reliable person. The attacker won't request a wire transfer (or data) until they are certain the target is at ease enough to comply.

Attackers may occasionally use the "spoofing" technique to make messages appear to have originated from a well-known source; in these cases, the sender address resembles a contact you can trust (though a hover over that address will reveal something different). In some situations, fraudsters are able to obtain email login information and send messages from a valid account, making it very challenging for an email receiver to recognise a fraudulent request.

Conclusion: Nothing should be taken at face value when it comes to a wire transfer or payment request (or an email requesting sensitive personal data). Any solicitation of this kind should be viewed critically, especially if the requestor asks for an exception to previously established banking procedures or account information.

Fact #3: You Have the Ability to Thwart BEC Attacks.

To preventing various forms of fraud and safeguarding personal and company data, cybersecurity awareness and a knowledge of email best practices are essential. When it comes to BEC attacks, a few comparatively easy steps can make all the difference:

• Set up a confidential, "need to know" procedure for people to get face-to-face or voice-to-voice confirmation that the request is legitimate if you frequently ask for wire transfers or tax-related information. Make sure to share that procedure with others outside of email, through a reliable method.

• If you frequently process payments or data,

you need to safeguard your organization’s finances and data as well as your reputation. Acting on a request requires both confirmation of the request and authorization to carry it out. This is especially important if you're under pressure to respond quickly or disobey established protocol. Ask your supervisor to implement non-email-based approvals for these types of requests if there aren't any procedures in place to help avoid fraudulent transfers.

• If you routinely approve fund or data transfers, make sure that you are not the only person who can give approval. Working with additional stakeholders to make sure that your process does not have a single point of failure can help you ensure that approvals take place through a channel (or channels) other than email. Never jeopardize the approval chain by permitting transfers to occur outside of the approved protocol. Be ready to be contacted by phone or in-person meetings for approvals.

Conclusion: Parties in the “chain of command” for either funding aircraft transactions or the supporting data need to be aware that email fraud is prevalent and there are steps you can take to ensure the prevention of fraud. It is vital that people are aware of the risks and safety precautions. Remember that you could suffer a BEC attack in your personal life even if you don't frequently engage in these activities at work. Any request for a wire transfer or data transfer should be carefully examined before you act on it, regardless of when it occurs or where it appears to originate from.  It is possible for a fraudulent email to appear legitimate.  Therefore, putting in place a secondary (non-email) based means of confirmation for events like aircraft closing wire instructions should be considered as a standard (best) practice.

This article was originally published on February 15, 2023.

NAFA member, Stephen Hofer, President of Aerlex Law Group, discusses the outlook of the 2023 business aviation market.

What will happen to the business aviation market in 2023? That’s the $64,000 question on everyone’s mind now as we come to end of 2022 and what has been a truly unprecedented 18-month paroxysm in market growth. Everyone in the industry, from aircraft brokers, sellers and buyers to management companies, charter providers, aircraft maintenance and repair facilities and even hangar landlords, would like to know the answers as they draft their business plans and draw up their budgets with a new calendar in mind.

I attended the 2022 Corporate Jet Investor Miami Conference in early November at the Fontainebleau Miami Beach and several panels were devoted to forecasting the future. Rollie Vincent, president of Rolland Vincent Associates, LLC and co-creator of JETNET iQ, and Wayne Starling, executive director of the International Aircraft Dealers Association (IADA), two seasoned veterans of the industry with more than 60 years of experience under their collective belts, looked to the numbers rather than tea leaves in an effort to glean the answers.

Starling shared data from IADA’s Third Quarter 2022 Market Report and Quarterly Forecast based on information collected from some 50 dealer/members with 300 brokers (full disclosure, Aerlex Law Group is an IADA Products and Services Member) and it indicated that the third quarter of 2022 was nearly as busy as the whirlwind third quarter of 2021 when the post-Covid 19 recovery first erupted. The numbers were impressive – 331 completed transactions in 3Q 2022 versus 340 in 3Q 2021 and 355 deals under contract in 3Q 2022 versus 360 in 3Q 2021 – although there were a few statistics that suggested a slowdown may be in the offing: 31 transactions with lowered prices in 3Q 2022 versus only 7 in 3Q 2021 and 162 new acquisition agreements in 3Q 2022 versus 190 in 3Q in 2021.

Read full article here

This article was originally published in BusinessAir Magazine, November 2022, Volume 32, No. 11.

NAFA Member, David G. Mayer, partner in the global Aviation Practice Group at Shackelford, Bowen, McKinley & Norton, discusses aircraft privacy. 

Business aircraft owners around the globe constantly risk exposure of their personal information on the ground and in the air. The consequences could result in threats to their safety and security or cause the loss of opportunities for them or their enterprises. For large corporations, even the optics of operating business aircraft may invite unwanted public scrutiny.

In light of these risks, aircraft owners and operators (owners) should, with their best advisors, apply technology tools to thwart breaches of privacy, create legal ownership structures to protect their identity, and implement security and aircraft use plans to mitigate these risks. They should also monitor and adapt to changes in laws that affect access to personal information, such as the FAA’s controversial pivot on December 12 to enhance privacy—at a potentially burdensome cost.

Read full article here

This article was originally published in AINonline on January 13, 2023.

NAFA member, Aerlex Law Group President Stephen Hofer, discusses worldwide economic woes in the private aviation market.

Raging inflation. Tumbling stock prices. Plummeting portfolios. Rising interest rates. Fears of recession. Dramatic price increases for jet fuel. A stubborn pandemic that refuses to recede. Supply chain woes. War in Ukraine. Sanctions on Russian aircraft.

The domestic and international economic news through the first six months of 2022 has been, for the most part, discouraging, but its impact thus far has been minimal in the private aviation industry.

As an attorney who advises clients on the purchase and sale of business and corporate aircraft from our Aerlex offices in Los Angeles, I have to pay careful attention to what is going on both in the general economy and specifically the private aviation industry. The warning lights are flashing yellow and red for the overall economy, but they’re still blinking green in the corporate aircraft lane and probably will for the rest of the year – although 2023 could present a different story.

There are a number of factors that continue to buoy aircraft prices. Demand remains strong and both individual and corporate would-be buyers have the cash reserves to pay for their purchases, sparked in part by the $6 trillion in Covid relief stimulus that the United States government poured into the economy in 2020 and 2021. Although Covid-19 continues to present risks as the coronavirus mutates, the widespread introduction of vaccines and the lifting of many travel restrictions around the world has spurred a renewed interest in safe travel, both domestically and internationally.

Read full article here

This article was originally published in BusinessAir Magazine, July 2022, Volume 32, No. 7.

NAFA member, Stephen Hofer, President of Aerlex Law Group, shares important information regarding electronic larceny in aircraft transactions.

It was a very different world when I began doing the legal work for aircraft purchase and sales transactions in 1992. The Internet was in its infancy and played no role in the acquisition process. Documents were signed in blue ink and transmitted via fax machine, overnight courier or even through the mail. And we had no serious concerns about thieves trying to steal the sale proceeds or divert deposits.

THAT WAS THEN.  THIS IS NOW.

I have handled more than a thousand whole and fractional aircraft transactions in the past 30 years and the closing process has changed completely. If you are thinking about buying an airplane today, you need to realize that criminals operating from every dark corner of the world have figured out that there’s big money involved in aircraft sales and they will do what they can, if they can, to steal millions of dollars from unsuspecting buyers and sellers. The thing that has opened up aircraft transactions to the risk of theft is, ironically, the thing that has made transacting sales so much easier and that’s the Internet and the opportunities it provides for easy, instantaneous, electronic digital execution of documents and transfer of funds.

Aircraft transactions often involve multiple parties in addition to the seller and buyer. Both sides will generally employ brokers, attorneys and accountants, and the buyer may have a lender providing financing. There is almost always at least one title company or law firm in Oklahoma City managing the escrow and handling the filing of documents and transfer of funds and sometimes multiple escrow agents. And with closings often taking place in remote, tax-friendly locations, there’s a good chance that management companies and their pilots will also be involved in the process. Back-to-back and/or international transactions can add further levels of complexity.

Read full article here

This article was originally published by Aerlex Law Group on September 13, 2022.

A new FAA privacy policy could further delay U.S. aircraft registrations forcing buyers to temporarily register their aircraft with foreign entities.

A new FAA measure to safeguard the privacy of aircraft owners could further mire the aircraft registration process in more delay. At the height of the aircraft transaction season, the FAA has blocked public access to ancillary records for aircraft ownership that are often required to complete transactions. These include documents pertaining to trusts, estates, mergers, consolidations, distributions, powers of attorney, and limited liability company statements belonging to those registered in the Civil Aircraft Registry Electronic System.  

However, the FAA will allow public access to a summary page of those records. Aircraft brokers and attorneys maintain that this is a half-measure that will further delay the U.S. registration of aircraft, which was already taking as long as six months, and likely force them to make time-consuming, individual requests for the records from the FAA general counsel’s office. In the interim, new owners may be forced to place aircraft on foreign registries such as Bermuda or Isle of Man in order to complete transactions, warns AIN contributor, aviation attorney, and NAFA member David Mayer, a partner in the Dallas-based firm of Shackleford, Bowen, McKinley & Norton. 

Read full article here

This article was originally published by Mark Huber of AIN on December 27, 2022.

NAFA member, Stephen Hofer, President, Aerlex Law Group, discusses the importance of using experienced professionals when it comes to aircraft acquisitions.

People who work in the private aviation industry constantly stress the need for would-be aircraft buyers and sellers to assemble a team of professionals to support them in the purchase or sale of business jet aircraft.  That team includes brokers, attorneys, financial advisors, aircraft managers, technical advisors, lenders, insurers and title and escrow handlers.  What’s critical, however, is that the members of the team actually have experience and expertise in handling private aircraft transactions.  A failure to includes knowledgeable and seasoned pros on your team can have disastrous consequences.

The attorneys at Aerlex Law Group have handled over 1,000 whole and fractional aircraft acquisitions over the past 17+ years and while we regularly give this advice to potential or new clients, we tend to treat the guidance as pro forma, a given, “why of course, why would you do anything else?”  That being said, I am approached periodically by would-be clients who want Aerlex to help them fix problems that have already erupted – and I am sometimes astounded to learn of mistakes that were made, even when the buyer or seller had legal counsel involved.  What it proves, beyond a shadow of a doubt, is that our industry has its own unique methods and protocols and those procedures are in place for a reason.  Here are a couple of examples (names have been omitted and the facts have been changed somewhat to preserve confidentiality).

Read full article here

This article was published by Aerlex Law Group on October 19, 2022.

NAFA member, David G. Mayer, Partner at Shackelford, Bowen, McKinley & Norton, LLP, discusses the value of due diligence in aircraft transactions.

The value of due diligence exists in the eyes of the beholder. Their place in an aircraft transaction informs their diligence criteria, inquiries, and judgment.

Most financiers consider the five Cs (character, capacity, capital, collateral, and conditions) and investigate each element before closing a loan or lease. Sellers ensure that they transfer good titles to qualified buyers. Aircraft buyers traditionally perform comprehensive due diligence in all phases of a purchase transaction.

However, in the current seller’s market, buyers that require excessive or even customary diligence may cause a seller to kill the deal and move on to another buyer waiting in the wings that may not require the same level of diligence. As a result, some buyers sacrifice diligence to buy an airplane, any airplane.

To initiate due diligence and avoid costly mistakes, buyers should steel themselves; it is hard to be objective, especially for first-time buyers, during the potentially emotional journey of seeing beautiful time machines for sale. Buyers should also engage experienced aviation professionals, including an aircraft broker, technical consultant, aviation counsel, insurance broker, aviation tax expert, escrow company, and FAA counsel.

Starting when a buyer first seriously considers purchasing an aircraft, the buyer should spool up professionals to guide the buyer through the buying experience, in five diligence areas along with financing.

Read more

This article was originally published by AINOnline on November 11, 2022.

Forrest Owens, Esq.  
Board Certified Specialist – Aviation Law  
888-6FLYLAW Ext. 2 
forrest@aviationlegalcounsel.com  
admin@aviationlegalcounsel.com   

NAFA Welcomes New Member: Aviation Legal Counsel 

National Aircraft Finance Association (NAFA) is pleased to announce that Aviation Legal Counsel has recently joined its network of aviation professionals. Aviation Legal Counsel is a leading aviation firm that assists aircraft transactions, registration, tax, finance, litigation and more. 

“NAFA members proudly finance, support or enable the financing of general and business aviation aircraft throughout the world, and we are happy to add Aviation Legal Counsel to our association,” said Jim Blessing, President of NAFA.  

About Aviation Legal Counsel: 
The firm and its staff have years of experience in aviation, including aviation legal considerations, aircraft operations and maintenance. The team has extensive experience in hundreds of aircraft transactions, ranging from home-built aircraft to large cabin corporate aircraft with every major manufacturer, including rotorcraft.  

Aviation Legal Counsel concentrates on aircraft and aviation-related transactions, cross-border transactions, airman defense before the FAA and Department of Transportation, airport real estate and land use, and civil litigation arising from aviation-related disputes.  

The firm is also well-versed in fractional ownership and shared ownership arrangements. Aviation Legal Counsel is committed is to staying current to support a client’s aviation legal needs, now and in the future. 

For more information, visit: http://aviationlegalcounsel.com/  

About NAFA:  

The National Aircraft Finance Association (NAFA) is a professional association that has been promoting the general welfare of aircraft finance for 50 years. Our network of members is comprised of lenders and product service providers who work together to finance general and business aviation aircraft. NAFA sets the standard for best practices in aviation finance by educating its members on the most up-to-date industry trends and best practices. Government legislation, market influences and industry insights allow member companies to provide the highest quality services the industry has to offer. The company now has three offices: Geneva, New York City and Dubai. 

What do the Russian sanctions mean to aviation lenders in the U.S.? 

Are you considering an international aviation transaction? Given the recent Russian sanctions that the U.S. has implemented, there are significant concerns of which everyone needs to be aware. With sanctioned individuals, entities and countries changing rapidly, it is difficult to keep up with the latest developments. Overall, the situation creates an environment that makes it more challenging to lend in emerging markets, especially Eastern Europe. People often forget that sanctions apply to individuals, entities, vessels and aircraft. Even if an aircraft may be owned by a non-sanctioned individual, if it is sanctioned itself, no lender may lend against it.    

How do you manage loans that involve—tangentially or directly—people who are under sanction by the U.S. government? While doing business with sanctioned individuals violates U.S., U.K. and E.U. laws, it also presents the potential for negative impacts on their reputation. 

When it comes to financing aircraft sales, being under Russian sanctions is the equivalent of having your name on a no-fly list. Doing business with someone who wasn’t on the sanctions list earlier, but suddenly is, creates a challenge for lenders. Experts recommend calling an event of default on the loan and once the right to cure period is over, making every effort to retrieve the aircraft involved, which presents its own challenges in the current environment. Most loan contracts have a default clause for sanctions violations, providing ample recourse for terminating the transaction, but not necessarily a path to obtaining possession of the aircraft. 

Read full article here

NAFA thanks Ford von Weise (Citi Private Bank) and JC Ferrer (Holland & Knight, LLP, Miami FL) for contributing to this article. 

This NAFA article was originally published in Business Air, Issue 5 2022, p. 38 in May 2022.

NAFA member, Jeffrey S. Towers, Vice President and General Counsel for TVPX, discusses United States Imports and Exports of Aircraft.  

Introduction:

Like most other developed countries, the United States (U.S.) regulates the entry and removal of goods, including aircraft, across its borders. The primary reasons for regulating commerce in and out of the country are to measure the balance of trade and to prevent cross-border transfers involving prohibited merchandise or prohibited parties. The rules for U.S. imports and exports require the party or parties involved to timely and accurately report certain information to the government and under some circumstances to obtain licenses or other authority for exports.¹ Unlike other jurisdictions, the United States does not charge significant taxes, fees or duties on most aircraft imports or exports.² However, the governmental agencies that are primarily involved in imports and exports, namely U.S. Customs and Border Protection (CBP), Census Bureau, and Bureau of Industry and Security (BIS), can assess significant penalties and seize aircraft for violations of the reporting or licensing requirements.

Import Process:

An aircraft does not need to be imported when it is merely functioning as a carrier of passengers or cargo into the U.S.³ However, an import entry is required in other circumstances, such as when a foreign-based aircraft is brought into the United States for a pre-buy inspection and a closing or is brought into the United States for the purpose of basing the aircraft in the U.S. long term. In addition, aircraft typically must be imported when moved to the U.S. for repairs and alterations. In these situations, the aircraft is considered the merchandise that is being imported. The import entry needs to be completed prior to bringing the aircraft into the U.S. It is critical, therefore, that the party bringing in the aircraft hires a U.S. customs broker, supplies them with the necessary information to process the entry and takes the other required steps in advance.

Read full article here.

This article was published by TVPX in June 2022.