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By Hunter Old - Once upon a time, you bought and registered an aircraft and it was registered for good as long as you continued to operate it.  However, the days of a permanent registration for all aircraft are gone, causing a new headache for corporate flight departments everywhere.  Under new FAA rules that took effect last fall, for all aircraft (including helicopters) that were registered before October 1, 2010, the registration expires according a table of rolling dates based on the month the current registration was issued.  For example, if your current aircraft registration was issued between March and July of any year, its registration expires some time in 2011.  Once re-registered, each aircraft registration then will have to be renewed every three years.


Photo: Dan King

 

Until the new rule took effect last October, aircraft registrations did not automatically expire.  Once registered, an aircraft remained that way until it was sold, the owner died or changed addresses or the aircraft itself was scrapped or destroyed.  Since 1980, the FAA has utilized the Triennial Reporting Program, which involved sending owners a report every 3 years and asking them to return the report only if there were any changes.  Unfortunately, this policy led to a large number of inaccurate registrations: in its published notice, the FAA estimated that fully one-third of the more than 350,000 aircraft registrations contain inaccuracies, and the agency laid the blame squarely upon “failures in the voluntary compliance based system.”  In other words, according to the FAA, many owners simply did not report a change, or the information reported ended up being inaccurate.

 

Additionally, the FAA claimed the number of unopened reports returned to it as “undeliverable” has increased over the years, resulting in unnecessary expenditures by the agency and by manufacturers who mail out emergency airworthiness directives, safety notices, and surveys to aircraft owners.  Many orders revoking the registration also were returned as undeliverable.  However, because the FAA had no way of knowing where the aircraft was, whether it had been sold or whether it was still operating, it kept the aircraft in the system to prevent reassignment of the N-number to a second active aircraft.

 

New registration certificates, whether for newly registered aircraft or aircraft being re-registered, will have expiration dates three years after they are issued.  The expiration will be printed on registration, and also will be listed on the agency’s registry website.  Additionally, the FAA will issue two reminder notices to an owner before the scheduled expiration date of an aircraft’s registration.  The first will come out 180 days before the registration expires, 60 days earlier than had first been proposed, and will provide the date upon which the registration application must be returned.  The filing window for an aircraft registration will close two months prior to the expiration date, and while the FAA still will process registrations received less than 60 days prior to the expiration date, it will not guarantee the issuance of a renewal prior to the expiration date.

 

Should an owner fail to re-register his aircraft, or fail to renew his registration in time, the penalties can be severe.  An aircraft that does not receive a renewed registration before the old one expires is considered unairworthy.  Operating an aircraft without a valid registration could result in civil penalties and certificate actions against both the owner and operator.  Allowing a registration to expire may also invalidate some insurance policies or result in a default of leases or loan agreements.  Finally, the FAA will cancel registration numbers 90 days after the expiration of a registration, and will make that number unavailable for five years following the cancelation.

 

To help aircraft owners navigate this procedural headache, the Aircraft Registry database now will post lists on its website showing aircraft as they move through the various stages of re-registration and renewal.  According to the FAA, these changes will help owners keep the aircraft continuously registered, and will help keep other interested parties, such as lenders and insurers informed about the registration status of the aircraft.

 

During the rulemaking process, the FAA received almost 100 comments from all segments of the aviation community.  The comments from the commercial side focused on the cost of compliance with the new reporting requirement.  Commercial commenters contended the FAA underestimated the costs to some aircraft owners because a high percentage of commercial and corporate aircraft, and a large number of general aviation aircraft, are leased to third parties and subject to financing agreements.  According to the commenters, the FAA failed to account for the need by such owners to implement monitoring systems for re-registration purposes, and the cost that would accompany the development and maintenance of such systems. The commercial commenters contended the costs associated with taking the actions necessary to comply with the regulations would be substantial for owners, operators, and financial institutions dealing with large aircraft fleets and should have been included in the regulatory evaluation.

 

While the FAA agreed with many of these comments, it pointed out in the Final Rule that many operations already have a tracking system for maintenance or scheduling aircraft, and it pointed out that these systems could be modified or adapted to help maintain aircraft registration by those who choose to use this method.

 

The FAA stated in the Final Rule issued last July that the change was prompted by requests from a number of federal and law enforcement agencies, which use the FAA Registry Aircraft Database to obtain information.  The FAA also admitted that the current aircraft registry database may contain inaccurate information on up to

FAA Registration Table

36.5% of the registered aircraft.  Under the new rules, that error rate is expected to decrease to about 5.7%.  And as a direct result of the new registration requirements, the FAA contends, law enforcement and security agencies will have access to more accurate registration records.  According to the FAA, more reliable notification regarding safety issues should improve aviation safety.

 

 

However, the new registration requirement creates a process that is a potential quagmire for those who do not take the time to become completely familiar with it.  In short, be proactive and make sure you are aware of the re-registration date of all aircraft in your inventory, and then make sure you mark your calendar at least 60 days before the expiration of the new registration.  Failing to make yourself completely familiar with these new requirements could leave you with a grounded and unprotected aircraft.

 

Hunter Old represents aviation businesses, pilots and mechanics as a partner with the law firm of Kaufman & Canoles, P.C. in Williamsburg, Virginia.  He also is licensed as a commercial helicopter pilot, and flew both UH-1s and CH-47s for the Army Reserves.  He can be reached at whold@kaufcan.com, or on (757) 259-3870.

 

 

 

Posted in: Regulatory

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