In a late-2014 legal opinion, the FAA claimed its authority to deny the issuance of a certificate of airworthiness (“C of A”) to an aircraft located outside the United States in cases where it determines that the issuance of such presents an undue burden to the agency. Specifically, the FAA suggested that it may invoke the “undue burden” test to deny the issuance of a C of A to an aircraft registered to a U.S. bank, but located on foreign soil. The agency’s test is derived from FAR 21.325, which states that “if the FAA finds no undue burden in administering the applicable [statutes and regulations], an export airworthiness approval may be issued for a product or article located outside of the United States.”
Even in cases where the owner or purchaser of an aircraft utilizes the services of a Designated Airworthiness Representative (“DAR”), the FAA claims that due to its oversight responsibilities involving DARs, the use of a DAR does not eliminate the “undue burden” to the agency and a C of A may still be properly denied. Clearly, this is a troubling development in the already complex maze of aircraft transactions which include an import or export of the subject airplane. Engaging experienced legal counsel early in the process will help to avoid the many pitfalls inherent in these types of transactions.
Part 135 air taxi operators seeking to add a new aircraft type to their operations need not wait until they receive notice that their amended Air Taxi Registration form (4507) has been approved before commencing operations with the new aircraft. A recent FAA legal opinion acknowledged that filing the amended registration pursuant to 14 CFR 298.23, within 30 days after a change occurs, is sufficient to commence or continue operations after adding a new aircraft type. However, the FAA cautioned that the filing of an amended registration does not relieve the operator of the requirement to obtain approval for any necessary amendment to its operations specifications pursuant to FAR 119.51. The certificate holder is required to file an application to amend its operations specifications prior to the desired effective date of the amendment, but the amendment is not effective until approved by the FAA.
Therefore, when adding a new aircraft type to its operations, an air taxi operator should obtain approval for any necessary amendment to its operations specifications prior to commencing operations with the new aircraft, but it may file its registration amendment within 30 days after the change occurs and still maintain its exemption. Any failure to strictly comply with these regulations will likely result in the operator losing its exemption and becoming the subject of an enforcement action. To avoid these pitfalls, operators should consult with experienced aviation counsel when changing their operations in order to ensure compliance.