What's Happening?
The Federal Aviation Administration (FAA) has grounded N-registered aircraft held in trust with Southern Aircraft Consultancy Inc (SACI) due to invalid Certificates of Aircraft Registration. The FAA determined that SACI did not comply with U.S. citizenship
requirements when submitting aircraft registration applications using Non-Citizen Trust (NCT) arrangements. Consequently, the FAA has instructed SACI to surrender all affected registration certificates. This decision impacts aircraft registered through SACI, particularly affecting UK-based operators who must cease flying until the registration issue is resolved. The Civil Aviation Authority has confirmed the FAA's ruling, which also raises concerns about the validity of mandatory aircraft insurance for these aircraft.
Why It's Important?
This development has significant implications for international aircraft operations, particularly for non-U.S. owners who rely on N-registration for their aircraft. The grounding affects the legal status of these aircraft, potentially disrupting operations and financial arrangements. Aircraft owners must now navigate complex re-registration processes, either by registering in another country's registry or restructuring their U.S. registration to comply with FAA requirements. The situation underscores the importance of compliance with U.S. aviation regulations and the potential risks associated with non-citizen trust arrangements. The ruling could lead to increased scrutiny of similar arrangements and impact the broader general aviation community in Europe and beyond.
What's Next?
Affected aircraft owners have limited options to regain legal flying status. They must either re-register their aircraft in another country's registry or apply for re-registration in the U.S. using a compliant trust structure. The FAA has provided a 21-day window for SACI to surrender the affected registration certificates, but the grounding is effective immediately. Owners intending to operate internationally must submit a Declaration of International Operations for expedited processing, although this does not grant immediate rights to fly abroad. SACI is exploring transferring its business to a U.S.-based trust company to minimize disruption for its clients.
