I have heard it said that this circumstance in itself makes the whole construction of Southern somewhat borderline, legally speaking. Is that true?
Why?
Hi bosco,
I registered my new plane via SAC last Dec and had no problem with them. All is fine and it took only a couple of days. You have to deal with the british office only. Everything was straight forward.
Why?
Well, I thought this was obvious…. the point is that an N-reg. aircraft must be formally owned by an American or an American company…. hence the requirement for a trust in case of a non-American (factual) owner (losely speaking).
So the trust – I thought – would have to be US based, no?
I can’t immediately see why an American can’t own a US company holding the trust on an N-registered aircraft, no matter if that American also in addition holds a foreign physical address or phone number.
The trust address is not in itself relevant. AIUI, the N-reg aircraft has to be owned by
It is likely true that a US company has to be incorporated in the USA so cannot have an address outside the USA. But most of the N-reg trusts used in light GA are US citizens (individuals). These individuals can live anywhere. So for example if the owner himself was a US citizen he doesn’t need a trust even if he and the plane live in Mongolia.
The bigger stuff e.g. jets tend to be US corporations, which has the advantage that the shareholding can be made up from several invididuals (usually lawyers) and if one of these dies you just bury him before he gets too smelly and appoint another one – if required to maintain the minimum 75% requirement. Obviously if all shareholders are US citizens then any number can die (so long as just 1 remains) and the US ownership will never fall below 100%, but these trusts tend to be done so that the non-US aircraft owner is a shareholder, so that you need at least 3 US citizens to achieve the 75%. I am not sure if one can do this by issuing some different number of shares e.g. 25 shares to the owner and 75 shares to a single US citizen. This trust structure gives the aircraft owner a bit of nominal control and makes him feel better, but it costs quite a lot more money annually.
As discribed in other threads here, the FAA’s main concern is that the trust does not conceal the identity of the Trustor (US speak) / Beneficial Owner (UK speak).
I can’t immediately see why an American can’t own a US company holding the trust on an N-registered aircraft, no matter if that American also in addition holds a foreign physical address or phone number.
That’s why I asked whether in the case of SAC for example, I would be dealing with British people / a British company. From your reply, I would guess that the answer is no.
With SAC, you deal with an extremely nice and helpful lady in the UK 
She is the daughter of Warren Chmura who started the business but died in a car rally crash in Morroco some years ago. I believe the trust is owned by his brother who like him is a US citizen.
A few years ago I went to an FAA seminar at Luton airport, UK, where SAC were present and it was clear the FAA is very happy with them and their trust structure.
FWIW I have not seen particular difficulties in dealing with Americans. I export some 25% of my stuff to the USA. There are much much bigger issues in dealing with certain cultures in Europe unless you can speak their local language and know the culture The difficulties, if any, with Americans are corporate / organisational ones and unfortunately that is a disease which is spreading everywhere.
Peter wrote:
She is the daughter of Warren Chmura who started the business but died in a car rally crash in Morroco some years ago. I believe the trust is owned by his brother who like him is a US citizen.
I know several people who are British born, live (and vote) in the UK, and could own your N-register plane for you, because they are also US citizens. Maybe I should suggest this to them as a business opportunity Now that I think about it my wife could also do it, providing the service in German for those who’d prefer it, but her Bavarian dialect might be a problem for some 
That indeed is a business opportunity which I have suggested to many such in the past
One issue is that you do need to document the arrangement properly, otherwise the trustee could literally just run off with the plane. Another is that, for reasons I don’t understand, the trustee apparently needs some sort of insurance. So it isn’t all pure profit.
As an American ex-pat, I have often been asked if I could act as Trustee for many friends & clients, and I have always refused.
IMHO, it is not a very interesting “business opportunity” since it requires far more time & dedication than one might think. That said, there are a number of Trustees out there that do NOT put in the time & dedication and they should be avoided. One that comes to mind is International Air Services, aka “Captain Bob”.
Further, as of 2013 the FAA tightened up the reporting requirements for Non-US citizen Trustors. The full narative is here : https://www.faa.gov/licenses_certificates/aircraft_certification/aircraft_opinions/media/56a.pdf [ local copy ]
There is one small disadvantage with a Foreign based Trustee: If you ever need something from the FSDO, like a replacement, duplicate Airworthiness Cert. you will be obliged to go through a DAR at great expense since there is no “local” FSDO to deal with.
