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Aircraft Transactions

What constitutes a valid Bill of Sale for aircraft?

A Bill of Sale must be in writing, clearly identify the aircraft (MSN, registration), name the buyer and seller, and be signed by the seller to validly transfer title under Georgian and international law.

Do I need to register the purchase with the International Registry?

Yes, to protect your interest against third parties globally, registering the sale with the International Registry (under the Cape Town Convention) is highly recommended and standard practice.

Can foreign entities own aircraft registered in Georgia?

Generally, aircraft registered in Georgia must be operated by a Georgian certificate holder, though ownership structures can involve foreign entities under specific leasing arrangements.

What is the role of an Escrow Agent?

An Escrow Agent acts as a neutral third party holding the funds and signed documents, releasing them only when all conditions of the Aircraft Purchase Agreement are met, ensuring a safe closing.

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Aircraft transactions (buying and selling) are high-value, complex, and multi-stage legal processes that differ significantly from ordinary property transactions. An aircraft is movable property subject to strict international and local regulations. Purchasing or disposing of an aircraft in Georgia requires not only agreeing on commercial terms but also the correct transfer of title, change of registration, technical audit, and precise calculation of tax obligations. Errors made at any stage of the transaction can result in the loss of the asset or significant financial loss for the owner.

What does Aircraft Transactions service cover?

Aviation transaction specialists provide comprehensive legal support, which includes:

  • Due Diligence: Verifying the aircraft's history, existing liens (mortgages, leases, attachments), and the completeness of technical documentation.
  • Aircraft Purchase Agreements (APA): Drafting the Aircraft Purchase Agreement, outlining price, payment terms, warranties, and liabilities.
  • Escrow Services: Structuring secure settlements involving an escrow agent to ensure the simultaneous exchange of funds and title.
  • Title Registration: Registering the transfer of ownership in the Civil Aviation Register of Georgia and the International Registry under the Cape Town Convention.
  • Export and Import Procedures: Legal processing of aircraft export or import, customs declaration, and tax planning.

Common Situations and Needs

Legal assistance related to aircraft transactions is essential in the following cases:

  • Fleet Renewal: An airline buys new or used aircraft to expand its fleet and needs to structure the transaction with the seller.
  • Private Jet Purchase: A businessman buys a private jet for personal use and wants to ensure the aircraft is "clean" legally and has no hidden liabilities.
  • Asset Sale: A Georgian company sells an aircraft to a foreign buyer and needs to correctly manage export procedures and payment guarantees.
  • Engine and Parts Trading: An airline purchases a spare engine, which also requires specific contractual and registration procedures.

Georgian Legislation and Regulations

Trade in aircraft is regulated by the Civil Code of Georgia (property rights, sales), although specific registration rules are provided in the Air Code of Georgia. It is particularly important that Georgia is a party to the Cape Town Convention, meaning that rights to aircraft (and engines) are also registered in the International Registry. This ensures the priority of the buyer's and creditor's rights. From a tax perspective, the Tax Code of Georgia regulates import tax and VAT, which often constitute a significant part of the transaction value and require advance planning.

Service Process

The transaction process typically involves:

  1. Letter of Intent (LOI): Signing a preliminary agreement between parties on key terms and placing a deposit.
  2. Inspection and Documentation: Physical and documentary inspection of the aircraft, preparation of the Aircraft Purchase Agreement (APA).
  3. Conditions Precedent (CPs): Fulfilling prerequisites necessary to close the deal (e.g., insurance, rectifying technical defects).
  4. Closing: Signing the Bill of Sale, transferring funds, and registering with the registry.
  5. Post-Closing Procedures: Updating operating permits in the name of the new owner.

Why Legal.ge?

Buying and selling an aircraft is not a routine operation; it is a strategic investment that requires top-tier legal qualifications. Legal.ge allows you to connect with experts who know the language of the aviation business and global standards. Specialists represented on the platform will help you conduct the transaction safely and effectively, protect your investment, and ensure all legal formalities are flawlessly executed.

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