In a recent legal opinion, the FAA cautioned that offering free seats to non-business passengers on private flights while encouraging those passengers to make charitable donations may be contrary to Federal Aviation Regulations. The seats in question are on aircraft which are owned by a company that is not engaged in air transportation, but uses its fleet of aircraft in furtherance of its business. The company allows individuals to occupy any unused seats on its aircraft when the transportation of those individuals is not within the scope of or incidental to the company’s business. The company does not charge the individuals for access to those seats, but offers to facilitate a donation by the individuals to one or more local charities.
Encouraging or facilitating donations for transportation on flights may be considered the carriage of persons for compensation or hire, requiring the operator to hold a part 119 air carrier or commercial operator certificate to operate these flights under part 121 or 135 rules. Because the FAA defines “compensation” in very broad terms, it does not require profit, a profit motive, or the actual payment of funds to determine that compensation was exchanged. Under the FAA’s definition, valuable good will can be considered compensation. Although charitable donations are not a requirement to obtain transportation on the company’s aircraft, encouraging or facilitating donations in exchange for transportation may result in the receipt of valuable good will. Therefore receipt of good will through facilitation of charitable donations in some circumstances may be construed as compensation, and thus would be in violation of FAR part 91.
The FAA distinguished this scenario from those flights authorized under FAR 91.146 – flights for the benefit of a charitable, nonprofit, or community event. Because the company merely encourages charitable donations, but does not conduct flights directly for charitable purposes, its flights fall outside this exception. Conducting charitable operations under the FAA’s narrow regulatory exceptions is complex and should be guided by experienced legal counsel.