FOR IMMEDIATE RELEASE: September 5, 2023
Contact: Tracey Cheek
tlc@nafa.aero
405.850.1292
Understanding the Benefits and Challenges of the FAA’s Online Registry
In May, the FAA opened its online registration platform, the Civil Aviation Registry Electronic Services (CARES), for individual aircraft owners to submit their general aircraft registration application online. The online registry allows users to fill out and electronically sign self-guided aircraft registration applications, securely upload legal and supplemental documents, receive auto-generated notifications, request aircraft registration N numbers and make online payments.
The FAA still accepts paper registrations and will expand the online services to include corporations, LLCs, partnerships and non-citizen trusts. The decision to offer online registration will help alleviate some of the backlog of outstanding registrations and is a step to modernize the registration process.
Allowing individuals to register their aircraft with CARES makes registering more advanced, accessible and may reduce registration costs if they register themselves without professional assistance. However, owners and owner agents still need to be cautious of the possible complications and challenges of registering an aircraft themselves.
Registering an aircraft with the FAA has many rules, regulations and nuances, and even the most minor mistakes in the process may cause a delay in registration or the plane to be grounded. Mistakes in registering aircraft are not uncommon, and these errors carry significant costs and time spent cleaning these mistakes with the FAA if the registration is not completed correctly the first time.
In addition, the backlog of workload the FAA currently has in registering aircraft will increase the time to register if the information is not entered correctly in CARES. The additional time the FAA spends finding, reporting and amending registry mistakes delays the registration process significantly.
There are also security risks with opening the registry. To date, no checks and balances are in place to verify the identity of the person registering the aircraft. Additionally, digital signatures are accepted, making the system vulnerable to fraud or forgery or compromising in the authenticity of the information.
If not caught at the front end, the errors made at registration will eventually arise when the owner looks to sell the aircraft. If there were any errors made during the registration process, the seller and buyer may not be able to complete the transfer of ownership, or they may find the aircraft grounded until these mistakes are cleared with the FAA. Errors during registration also make obtaining an accurate title and ensuring the aircraft title is clean of all clouds, claims or liens challenging.
As part of the National Aircraft Finance Association’s (NAFA) Light Aircraft Roundtable, NAFA Vice President Bryan Byers raised concerns about opening the registry and its impact on the aircraft finance industry. “We may not see the mistakes entered in the registry initially; however, these errors may pose significant future challenges for transfers of ownership and resales to new buyers and those who help facilitate these transactions.”
Prospective buyers should always work with reputable aviation professionals when purchasing an aircraft, whether it comes to financing, insuring or registering. Experts focused exclusively on business aviation are equipped with the latest information to ensure you have a smooth experience throughout the life of the transaction. This is especially important when navigating the new registration portal so the aircraft you purchase can get flying as soon and as safely as possible.
Depending on your experience level, you should seek counsel on the registration process from an aviation professional to better understand the process, the issues and the roles of the team needed to close these deals successfully.
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.