If an aircraft will be owned and registered with the FAA in the name of a limited liability company, then the LLC must submit documentation in addition to the registration application to support the certification that the LLC qualifies as a “citizen of the United States” as defined in 49 U.S.C. § 40102(a)(15). Typically, owners choose to submit a statement in support of registration, which contains the required information, as opposed to submitting a copy of the LLC Operating Agreement. While this statement may seem straightforward, in practice it may be difficult to get correct and thorough information for the statement, especially if this statement is being prepared at the last minute before closing.
What Information is Required on the LLC Statement in Support?
The required LLC statement in support of registration must contain the following information:
- Full name of the LLC
- State of organization/formation
- Date of organization/formation
- Name of each member
- Whether the LLC is member, manager, or officer managed
- Names of managers and officers, if applicable
- Whether members, managers, and/or officers can act independently.
- A statement regarding citizenship of each entity and individual, and how that supports the determination that the LLC is a citizen of the United States
Is the Information Correct on the LLC Statement in Support?
While some of the required information can be obtained and verified by looking at information available on the applicable Secretary of State’s website, other information may only exist in the LLC Operating Agreement or other company records. It is imperative that the individual providing the information for the statement in support review the LLC Operating Agreement and company records to confirm accuracy.
What are the Consequences of Incorrect Information on the LLC Statement in Support?
If the information provided on the LLC statement that is filed with the FAA is incorrect, it is possible that the FAA could take the position that that the aircraft registration is invalid. An invalid or improperly registered aircraft may result in enforcement action, the breach of financing agreements, the breach of leases and management agreements, and potentially the loss or reduction of insurance proceeds. If it is later discovered that there was an error on the LLC statement, or that information in the statement has changed, the owner should file an amendment to the LLC statement as soon as possible.
Lori N. McGee is a partner with the law firm of Jetstream Aviation Law and counsels clients on the acquisition, financing and operation of corporate jets operated under Part 91 and Part 135 of the Federal Aviation Regulations. Jetstream Aviation Law can be found at www.JetstreamLaw.com.
The information provided here is not legal advice and does not purport to be a substitute for advice of counsel on any specific matter. For legal advice, you should consult with an attorney concerning your specific situation.
