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FAA and International Registry Issues: Filings, Closings, Opinions and other Sundry Items

FAA and International Registry Issues: Filings, Closings, Opinions and other Sundry Items. Erin M. Van Laanen, Esq. McAfee & Taft, P.C. Phone: 405-552-2208 Fax: 405-235-0439 Email: erin.vanlaanen@mcafeetaft.com August 8-9, 2008, ABA New York.

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FAA and International Registry Issues: Filings, Closings, Opinions and other Sundry Items

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  1. FAA and International Registry Issues: Filings, Closings, Opinions and other Sundry Items Erin M. Van Laanen, Esq. McAfee & Taft, P.C. Phone: 405-552-2208 Fax: 405-235-0439 Email: erin.vanlaanen@mcafeetaft.com August 8-9, 2008, ABA New York

  2. Status of Transition FAA Registry Modernization System (RMS) • Transition began 2/25/08 • Backlog of documents to be processed has been substantially reduced • Fly wires, exports and imports are being processed in a more timely manner • Substantial issues still exist with getting complete, reliable records • Turnover of staff/new FAA examiners require constant double checking

  3. FAA Transportation Code: Transfers of Owner Participant Interests • Issue: Transfer of owner participant interest under owner trust; closing occurs outside of FAA Registry business hours • Can the closing occur without simultaneous FAA filing ? • If so, is the aircraft registration adversely affected? • FAR language: “each applicant must submit a copy of each document legally affecting a relationship under the trust” • ACC opinion: No mail box rule is applicable; no effect on registration • Result: closings outside of FAA hours are permitted

  4. FAA Transportation Code: Citizenship test requires “actual control” • Issue: Whether companies meet the citizenship test of “actual control” ? • Transportation Code language: …which is under the actual control of citizens of the United States • Voting trust agreements: used when the ownership of an entity is not controlled by US citizens • Is the actual control test met ? • What about owner trust? • What about Based & Primarily Used exception?

  5. Cape Town: Helicopter Engines • Issue: Whether helicopter engines are covered by the Cape Town Treaty • Convention language: yes and no; depends on where the engine is, what it is attached to, what time of day it is, whether it’s a bird or a plane • Solution: ?

  6. Cape Town: Informational Searches • Issue: Searches must be EXACT • Opinion assumption: search requires exact manufacturer, model and serial number; any variance is fatal; a space, comma, dash, capitalization, added number or character, missing number or character; result: there may be registrations which are not reflected on the Priority Search Certificates, which may have priority over subsequent registrations on the IR • New search ability: Limited informational searches are now available, but they are not always complete • Removal of opinion assumption: Probably not

  7. Cape Town: Informational Searches

  8. Cape Town: Informational Searches

  9. Cape Town: Consents to Registrations • Two types of “consents” • PUE/TUE “mechanical” IR consents • Contractual consent still required pursuant to the Treaty • Good business practice to require a writing for the file

  10. FAA Aircraft Deregistration – Cape Town • Article XIII - provides for Irrevocable De-Registration and Export Request Authorization (“IDERA") (opt in) • IDERA is filed with the FAA when a transaction closes • Upon default, request to deregister is made by the holder of the IDERA (the secured party) • Be sure that there is a default; it not, IDERA needs to be terminated

  11. International Registry – Registrations • Drop down list of TUE’s – not accurate • TUE is listed but the account is not valid or is dysfunctional • Discharges – issues with some TUE’s – can’t discharge an international interest

  12. Illegal Charter Operations • From the NBAA website: Due to a lack of inspectors, an illegal charter hotline has been created • Partnership between the FAA and National Air Transport Association • 888 759 3581

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