Maybe you should start by defining what you are calling a “syndicate”.
Are two or three partners and 1 airplane a syndicate ? How about 20 members and 3 aircraft ?
I would call the former a partnership and the latter a Club …
The two combined accounts for 95% (my WAG) of all GA activity in France, so one can assume it must be working reasonably well.
The concept of a syndicate is hardly known here in Austria. The vast majority of flying is done in aeroclubs, most of whom are focussed on affordable VFR flying. Than you have a handful of training / rental companies and privately owned aircraft, either by individuals or a (small) number of aquaintances.
For me, owning and operating the aircraft entirely on my own would be hard to justify. Together with a friend (whom I knew from business before buying the aircraft) it’s much more affordable, although still more expensive than renting. Since the aircraft is flown only 80 to 100 hours per year (3/4 of that time by myself), a third co-owner would fit in well, but we are not in a hurry.
Similar story from Belgium: most small planes are owned either by one single person, or by a group of two or three, who are usually well befriended, or by a club. Actually I am not aware of any “syndicate” of 5-10 owners as seems common in the UK. I reckon it must be due to the extreme cost of private flying in UK.
Maybe one could say such syndicates work better in UK than in most other places because other places don’t have them?
The difference is mostly on the legal side of things. At least here in Norway a club is a legal entity (if it’s a club in a legal sense that is, within NLF) that is governed by certain laws and regulations. It has to be democratic, elections every year that elects the boss, secretary etc. and which approves finances and so on. I have been on the “board” for several years (an auditor nowadays) in our club.
I’m not sure what a “syndicate” is, but the other way is to form some kind of co-operative. The co-operative could be a company, the company owns the airplanes, or some (much) looser form. It could be that one person owns the airplane and others contribute to the costs also, and everything in between. They could also call themselves a “club”, although it would not be club in the “legally correct” sense.
Often there are co-operatives within a club. Those co-operatives could make their airplane(s) available for all the club’s members. This could be good for the co-operative, more utilization of the aircraft, but is typically a poor way of running a club economically, although much safer for short term. A club is better off owning their own planes in the long run.
A syndicate in the UK sense is any group owning a plane.
The structure can be persons owning shares in the plane (usually equal shares but don’t need to be) or owning shares in a limited company which owns the plane.
The Ltd Co system protects shareholders from an accident involving a shareholder which for some reason didn’t get covered by the insurance – it’s a consequence of the UK Civil Aviation Act that all personal owners are liable jointly and severally, whereas shareholders in a Ltd Co aren’t.
There was also a limit of max 20 shareholders (specifically, each holding had to be at least 5%) otherwise the aircraft had to be maintained to a higher standard, but I believe (not sure at all) that this changed a few years ago. This limit applied to both direct and Ltd Co ownership. Recently, somebody discovered a subtle legal issue in the Ltd Co ownership route: the various benefits available only to “private flying” (e.g. cost sharing is permitted) do not apply to Ltd Co owned aircraft even if the only pilot is also a 100% shareholder. Probably an unintended bit of wording by the CAA since probably half of syndicates use a Ltd Co…
The UK does not have any legal provision for a “club” in the sense of the club getting some preferential tax treatment like exists in some countries (Italy and Greece come to mind). You can be a charitable organisation but the tests for that are a bit too strict… not that it stops a whole load of fake charities being set up.
OK, a club is very different from a syndicate then (syndicate being any group owning a plane). The main problem with a club could be it requires that someone actually runs the club. My impression is that most clubs are run well, as well as one can expect at least. If it isn’t, then everybody is to be blamed, and things can be fixed easily by electing other people into positions.
I used to own a share in the Army Cub, as a kind of syndicate within the club. That was completely un-problematic. It is now taken over by the club 100% by buying out all the shares. I also own a share in the WT-9 in the gliding club (used as glider towing plane). That is in the form of a loan. In 10-15 years time I own nothing.
Individuals going in to finance a particular plane is common. The club may, or may not wish to own the plane within some down payment plan, but it can chose to operate it nonetheless. The are lots of stuff like this going on, and as many forms of doing it as there are cases. A club can do this because the whole idea of the club is to get as many people as possible to fly as much as possible. The income is not the most important thing, but a healthy club needs to have some airplanes financing stuff, in particular the trainers are best owned by the club.
In Germany, there is a company that professionally runs syndicates (or co-ownerships, as they call it): http://www.wefly.de/
I have no experience with them, neither first nor second hand, but talked to them on the Aero in Friedrichshafen. One advantage of their model according to them is that they can write you tax deductible invoices for your business flights, because due to the legal construction that they use, you are not actually owning the plane. Using your own plane seems to be a show-stopper for deducting the cost of a flight in Germany, actually depending on which local tax office you are dealing with – so I have heard.
Apart from that, having clear rules and a neutral third party seems to be the main advantage in that model. But it would be interesting to hear some first-hand experience.
The UK generalisation is inaccurate. I am aware of several well functioning syndicates and I’m sure there are many more. And I personally participated in a syndicate of four for many years, in the UK, owning a well maintained and capable four seat retractable SEP, no issues at all.
The most important thing is not to have anyone in the group who is too cost sensitive. Things become difficult as soon as you have one person who wants to debate or avoid every single expenditure. If the operating costs are low relative to the group members’ own personal financial positions, it is easier to get agreement to do what is necessary in terms of maintenance, upgrades, etc.
In other words, find syndicate members who can easily afford to participate.
Personality fit is not as important as you might think, as you can easily go a year without seeing or talking to a fellow syndicate member, and instead just be exchanging a few emails with regards to finances and key maintenance decisions.
Agree with ortac, can think of half a dozen long standing syndicates in the vicinity – operating from Tiger Moth or Aeronca Chiefs through Arrows, Warriors, Sixes or Twinkies. Simple spam cans like the Warrior or Archer seem to be the most successful and well utilised.
One feature in some is that there is a 20:80 effect, ie 20% of the members seem to have 80% of the utilisation. In effect getting an implicit subsidy on indirect expenses. I need to be one of these members. I don’t think it causes ill feelings, it’s just the way it is.
“Sleeping” members are common for sure, and they subsidise the flying ones. Mind you, you also get the opposite… in one syndicate I know of, one member was doing the opposite and flying frequently to LFAT and pocketing the duty drawback 
I used to rent my plane out very early on and had two people who did that. Luckily I found out so I didn’t reclaim it again.
I guess my original post was not written all that well. Yes, lots of syndicates exist and most of them “function” but when you get closer you hear of lots of internal stresses and problems.
Ortac is dead right – you have to make sure all members are very comfortable financially. But someone who is a bit too comfortable financially will (usually) just buy their own plane and avoid all possible issues in one go. So almost by definition syndicates exist where the members don’t have that much money.
