The Legal and Regulatory Considerations of Aircraft Sales and Acquisitions

Before you decide to acquire an aircraft that is for sale, you need to understand that there will be a lot to consider. Plus, you need to know a few things concerning the legal and regulatory side of the sale.

Regulations Governing The Sale Of Aircraft

The sale of aircraft is highly regulated by federal laws that are in place to ensure that the public is kept safe. A federal agency that oversees aviation laws and ensures they are abided by is the Federal Aviation Administration or FAA. These laws are carried out by regulating the aircraft‘s airworthiness and registration.

Aircraft Purchasing

In order for you to purchase an aircraft, it requires you to have many qualified individuals involved in the process. These individuals should involve an aviation attorney, an agent who will make the purchase for the buyer, and an inspector.

With the purchasing team organized and the aircraft selected, a purchase agreement needs to be developed that is customized for the owner and covers all the details of the purchase. With every aircraft being unique, it makes sense that the agreement also is tailored to the specific aircraft and the terms related to the purchase and not just a general agreement that a seller offers.

When a purchase is made through Stratos Jet Charters, the purchase will include all of the details involving the terms and the buyer protections stemming from an aircraft investigation conducted by the buyer. This investigation will involve searching for liens or title issues and any other issues that may come up that are mechanical or technical in nature.

Verify Aircraft Documents

The warranties and representations that involve the aircraft need to be made aware by the seller and then incorporated. These warranties have to include the engine time, any existing damage, and the equipment that is installed. When these details are considered by the buyer, they need to be included as part of the agreement to purchase the aircraft. Besides these, there may be other details concerning escrow and deposit and the documents concerning them so that the buyer may know when closing takes place and the method by which aircraft acquisition occurs.

Conducting Due Diligence

After signing the agreement to purchase the aircraft, due diligence should be performed. This due diligence involves the need to review the legalities concerning the documents. The legalities also need to include the directives set by the FAA that may govern repairs that are significant and costly, logs governing airworthiness directives, and any other maintenance.

Perform Mechanical Inspection

Another evaluation that should take place to avoid any future legal issues from arising involves performing a mechanical inspection. The aircraft’s engine should be thoroughly inspected and noted if any issues need to be resolved prior to the closing. If the inspection is not conducted, it can be grounds to legally terminate the sale.

Oftentimes, the aircraft is sold “As Is” and the buyer is ultimately responsible in deciding the airworthiness of the aircraft during the purchase process. The buyer is also responsible for the aircraft remaining compliant with all regulations governed by the FAA.

Closing Of Aircraft Purchase

Now that all legal inspections are complete and issues are taken care of, the closing can commence. During the closing process, both the seller and buyer will need to be in contact with the FAA to ensure that the aircraft is both safe and that new ownership is registered.

Verification of the FAA Airworthiness Certificate needs to be conducted by the buyer by the time of closing to ensure it is current. Plus, transfer of ownership papers needs to be filed so tht the sale reflects the new owner of the aircraft.

Other Legal Considerations

Many other legal considerations exist as far as legal and regulatory considerations are concerned with an aircraft purchase. Some of these include the aircraft’s form of operation, such as if it is being leased or operated by a corporation. Others can also involve strategies of the aircraft to minimize liability for tax purposes, having strategies developed that reduce liability, and having required insurance throughout the purchase process and prior to closing.


No matter how an aircraft is being purchased, it is important to always consider the legal and regulatory processes. When the law and regulations are followed, the transaction can be a smooth one.

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