New Registration Rules Create Concerns
Owners of most bizjets and larger twins have been swept up in a complex registration system that has changed the rules for buying, selling and financing aircraft. The Aircraft Protocol to the Cape Town Convention on International Interests in Mobile Equipment came into effect on March 1 and was largely unnoticed in GA because its intention is to establish a uniform set of rules and standards to sell airliners and freighters to countries in the developing world. But limits on the weight and horsepower of aircraft that must be sold via this new registry also covers aircraft with as few as eight seats and powered by engines of 550 hp or greater -- a Cessna 421 fits the category. Writing on the business law Web site Mondaq, Thomas Gillespie and Robert Hill say it's a much different system than aircraft sellers are used to. "The Aircraft Protocol tries to minimize risks by centralizing information, standardizing procedure, and exporting key features of American and Canadian aviation law," say the authors, who work for the legal firm of Jones Day. "While it remains to be seen whether these changes will have the intended effects, there is no doubt that the changes have created a complicated regulatory regime that is fraught with pitfalls for the uninformed." Among the pitfalls is an extremely rigid protocol for registering an interest in an aircraft (or parts thereof). Participating countries are also free, to some degree, to interpret and apply the rules, which means buyers and sellers have to make sure they know which rules are being applied and which are not, depending on which country they are dealing with.