UK Part 145 Deadline Approaching: Make Sure You Have the Right Maintenance Release Documentation

December 4, 2024 by Leave a comment

If you have a US-based repair station or if you use US-based repair stations to provide MRO services, then you should carefully look at the approaching UK deadline. The UK has been accepting EASA 145 maintenance approval certificates (EASA Form 1) but will insist on UK CAA 145 maintenance releases (or comparable maintenance release documents accepted under a bilateral agreement) after December 31, 2024.

This means that distributors who sell overhauled components to UK operators and MROs will need those components to be overhauled under standards acceptable to the UK if the maintenance release is dated January 1, 2025 or later. Acceptable maintenance release documents in the UK will include:

  • UK CAA Form 1
  • FAA 8130-3 if signed as a dual-release under UK 145 privileges
  • TCCA Form One

UK CAA Part 145 Repair Station Certification

The practical deadline for U.S.-based repair stations to obtain UK CAA Part 145 maintenance organization approval is December 31, 2024. This certification is part of the UK’s transition following its withdrawal from the European Union (EU).

The new UK CAA approval process replaces the previous recognition of EASA certificates for repair stations servicing UK aircraft. The deadline does not affect maintenance approvals that were issued before the current deadline, so already-maintained parts with EASA Form 1 (issued by or before December 31, 2024) will still be acceptable for installation on UK-registered aircraft. However, parts subject to maintenance release dated after January 1, 2025, will require acceptable release documentation.

As of March 2024, the UK CAA had received about 150 applications from U.S.-based maintenance providers. As of late November 2024, over 700 U.S. entities had applied, with 300 receiving approvals. The UK CAA anticipates more applications in the final weeks of 2024.

Application Process and Deadlines

Applications for UK CAA Part 145 approval opened in January 2023. The agreed application deadline is September 30, 2024, allowing 90 days for approvals before the transition period ends. However, recent statements encourage anyone who hasn’t yet applied to come forward and submit applications as soon as possible, even if the September deadline was missed. New applications may not be approved by January 2025, but shops that have not yet applied should still submit their paperwork. The CAA aims to make the approval process accessible and let the market determine business placements.

Requirements and Eligibility

Applicants must hold a valid FAR 145 Repair Station Certificate issued by the FAA. Evidence of need for UK approval is required, but the bar is not set high; an expression of interest from a potential UK customer is sufficient.

While the UK CAA believes most commercial operator needs have been addressed, they recognize that some gaps in general aviation support may remain. The UK CAA is prepared to work with affected stakeholders and has workarounds in place to minimize disruptions for small GA operators.

Application Procedure

Submit a completed application form to the UK CAA.

Provide necessary documentation, including:

  • Copy of the FAA Air Agency approval certificate
  • Federal Tax Identifier Number
  • Payment of the relevant fee

Upon receipt of the UK Part 145 approval number, submit required documentation to the FAA. The FAA National Coordinator and CAA National Coordinator will keep a record and share the status of applications for UK Part 145 repair stations located in the US to monitor approvals granted by the CAA.

Costs and Validity

The Initial approval fee for organizations holding a FAR 145 Repair Station Certificate is £1,0822.

The Annual fee to maintain approval is £646.

Approvals are valid for 24 months and require renewal.

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Russia Sanctions FAQ: Intermediaries, Including MROs

February 28, 2022 by Leave a comment

QUESTION – Intermediaries, Including MROs: I have been contacted by an MRO that wants to buy aircraft articles. The MRO is located in a country where it is legal to export most aircraft articles without an export license. Last week, though, I got the same exact purchase order from a Russian air carrier, so I strongly believe that the MRO is buying on behalf of the Russian air carrier. Can I sell to the MRO despite this belief?

Short Answer

The short answer is that this export looks like it is likely to be prohibited unless you have an appropriate export license. The reason for this is because it appears from the fact pattern that the article is intended to be installed on a foreign aircraft and the foreign aircraft appears to be subject to Russian operational control. This makes the transaction subject to the new Russia sanctions published by BIS.

Analysis

It is important to remember that there is a special rule under the U.S. export regulations that requires additional due diligence for aircraft articles destined for installation on a foreign aircraft. If you know that the article you plan to export is intended for installation on a foreign aircraft then you need to identify at least three pieces of information (per 15 C.F.R. § 744.7(a)):

  • The country in which the aircraft is located, and
  • The country in which the aircraft is registered (I usually ask for the registry number as well, for verification), and
  • Who currently controls / leases / charters the aircraft and their nationality.

Once we have this information, then we need to analyze the information to assess compliance. Each of these locations needs to be cleared (either [i] no license required, or [ii] appropriate license obtained, or [iii] license exception found to be applicable). If any one fo them leads to a license obligation, then the license obligation must be cleared (e.g. license or exception) in order to perform the export.

An Example

Let’s see how this looks in a real-world hypothetical. Imagine that you get a purchase order from an MRO in Turkey. The purchase order seeks a set of articles that are all controlled under ECCN 9A991. Imagine that the MRO reveals that the articles are intended to be installed on a Irish-registered aircraft that is leased to and operated (controlled) by a Russian air carrier. Even though you are exporting to Turkey, you also need to consider the other nations identified in this analysis. Exporting an ECCN 9A991 article to Turkey or Ireland does not require a license based on destination (we will omit the other analyses, such as party-level restrictions); however the recently-promulgated Russia sanctions do require that these articles be licensed to be exported for the purpose of installation on an aircraft subject to Russian operational control.

In this hypothetical we need to find a way to address the Russian operational control of the aircraft. Typically we might turn to the AVS license exception. The new Russian Sanctions regulations explicitly permit reliance on subsections (a) and (b) of that AVS license exception. BUT – and this is important – the AVS license exception we would use (in section 740.15(b)) cannot be used for country group D:1 nations. And Russia is a D:1 nation. So the AVS license exception for aircraft articles is unavailable for this export transaction.

Unless we have a transaction that fits into another sort of license exception, we are probably going to need a license for this transaction.

What Else Can I Do?

Information is your friend in situations like this., The more information you have, the more you can explore other options, like special exceptions that might apply to your transaction.

For example, it might turn out that the bill of materials requested is part of a service bulletin, and the fact that a Russian carrier sought the same bill of materials might be an understandable coincidence. In such a case, though, I might ask the customer-MRO to provide assurances that the articles are being installed in a manner consistent with U.S. law. I would take this additional step because of a red-flag that was raised by the similarities between the purchase orders.

You also might identify another license exception that applies to the transaction.

Some exporters might tend to prefer an information-free transaction on the grounds that what-they-don’t-know-can’t-hurt-them. This is not always true in export cases. Remaining willfully blind to the facts may not shield you from liability. Instead, willful blindness to the facts is often more likely to lead to trouble.

The most important thing for exporters to recognize is that they have a role in preventing circumvention of the U.S. export regulations. Failure to fulfill that role undermines the regulations, but it also potentially puts you in jeopardy of administrative or criminal penalties for your support of an illegal export transaction.

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NEW: US Gov’t Payroll Funding for Aviation Businesses

April 6, 2021 by 3 Comments

The US government has recognized the extreme hardship that has befallen many aviation companies and has passed legislation that will provide payroll support to aviation businesses.

This is a new program that has just been authorized and is in the process of being developed. It is known as the Aviation Manufacturing Jobs Protection (AMJP) program, but the actual scope includes more than just traditional manufacturing jobs.

The program is targeted to three categories of aviation business:

  • FAA production approval holders – this includes businesses that hold PC, PMA and/or TSOA;
  • MROs holding FAA Part 145 credentials; and,
  • Aviation businesses providing goods or services under an AS9100 system.

The ASA Community has members that fall into each of these three categories.

The legislation is found in Public Law 117-2 at sections 7201-7202. The Department of Transportation plans to publish a website with resources to facilitate application and compliance under the program (we will let you know once it is published).

What Are the Program Benefits?

In summary, under the AMJP program, the government provides money directly to program participants to subsidize a portion of their payroll

Businesses that participate in this program will have to identify an eligible group of employees who perform a targeted activity (see above). This group can be no more than 25% of your total workforce. The members in this group are limited to employees with a total compensation level of $200,000 or less per year (each).

You will commit to retain this eligible employee group, and in return the government will commit to paying up to 50% of their base pay and benefits (“total compensation“) for 6 months. The government has appropriated 3 billion dollars for this program and if the program is oversubscribed, then this amount could be reduced on a pro-rata basis (which might reduce the government’s potential commitment to each applicant).

This program is for the “retention, rehire, or recall of employees of the employer” so that means that you can use the money to rehire eligible furloughed/laid-off employees.

Example: Let’s say you are a small business that distributes aircraft parts kits under an AS9100 system and is otherwise eligible for the AMJP program. You only have 12 employees. Three of your employees are involved in the AS9100 kitting process, so you designate them as your employee group. The combined annual salary of this group is $300,000 (including base pay and benefits). This means that the government could commit to paying $75,000 (50% of the salary for six months).

Example: Let’s say you are a larger distributor that distributes new aircraft parts under an AS9100 system and is otherwise eligible for the AMJP program. You have 600 employees who are substantially all involved in the AS9100 operations. Let’s say that you designate a group of 150 employees as your employee group. The combined annual salary of this group is $22,500,000 (including base pay and benefits). This means that the government could commit to paying $5,6255,000 (50% of the salary for six months).

As long as the program requirements are met, these funds would not have to be paid-back to the government. The funds would likely be treated like a grant.

What Can You Do Now, to Prepare?

The internal government mechanisms for managing this new program are still being developed, but while we wait for the program to be formally announced, there are some things that businesses can do now to ensure that they are prepared to take advantage of the program:

  • Read the legislation to make sure you understand the terms and conditions;
  • Assess whether you meet the fundamental requirements, which include:
    • US Aviation Business meeting one of the three categories described above;
    • in 2020, you laid off 10+% of your workforce or experienced a reduction in revenues of 15+% (each as compared to correlative 2019 numbers);
  • Read the ineligibility provisions of the law and make sure you are not ineligible (and avoid ineligibliity);
  • Obtain a DUNS number, if your business doesn’t already have one, because that is a likely prerequisite for application;
  • Register in the System for Award Management (SAM.gov) because that is the most likely mechanism for government distribution of the funds;
  • Obtain AS9100 certification, if you do not otherwise meet the qualifications.

Finally, you should be thinking of the questions that you may have and sending those questions to us. ASA is generating a list of Frequently Asked Questions and sharing it with the Department of Transportation in order to let them know what the community needs to know to make the program successful. This is an ongoing process, so please share your questions with us as you think of them.

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