Transacting User Entity Accounts
In order for EscroAir to establish a Transacting User Entity (TUE) account for you, EscroAir must be provided with both an executed confirmation of entitlement to act form, and where the TUE account is for a company or partnership, documents showing the due registration or existence of the entity or partnership. These documents can include a certificate of incorporation, certificate of status, certificate of registration, and in the event that none of these documents are readily available to be provided to EscroAir, we can (at marginal additional costs) obtain the required documents from the applicable provincial or federal corporate or partnership registry. Once the required documents have been submitted to the International Registry it usually takes 24-48 hours for the account to be fully activated. However, where a transaction is time sensitive the International Registry can respond more quickly, resources permitting.
TUE accounts are valid for one year and the fees charged by EscroAir for this service are similarly for one year of TUE account administration. Unless you plan to sell or refinance your aircraft, your TUE account does not need to remain active for any registrations to remain valid. When a TUE account becomes deactivated the registrations relating to that TUE are frozen in place and can only be dealt with once the TUE account is reactivated. Except for persons or companies that are regularly dealing in aircraft or have several aircraft that are the subject of periodic financing interests, the TUE account does not need to be maintained annually.
After a TUE account has been established EscroAir will manage the account and safeguard its unique secure-access key. As part of the TUE account administration and the associated fees, EscroAir will, on instruction, consent to any registrations involving your TUE account. However, where EscroAir is instructed to make or discharge registrations, these will be subject to additional fees.
This service is invaluable where parties may not be at a location that allows them to log on to the International Registry website when closings occur in order to consent to or register international interests on a priority basis.
Cape Town Convention and the Aircraft Protocol adopted on the 16th of November 2001 at Cape Town, provide for the registration and protection of International Interests that are recognised by all ratifying states, with priority being determined on a First-to-File basis.
The legal framework of the Cape Town Convention establishes that airframes capable of transporting at least 8 persons including crew or goods in excess of 2750 kilograms, helicopters capable of transporting at least 5 persons including crew or goods in excess of 450 kilograms, and aircraft engines that have at least 1750 lb of thrust or its equivalent (jet propulsion) or have at least 550 rated take-off shaft horsepower or its equivalent (turbine-powered or piston-powered), each qualify as aircraft objects.
IR Registrations and Discharges
Upon instruction of the registering party, or where such registrations are provided for under a letter of interest/intent or aircraft purchase agreement, EscroAir will take the necessary steps to file registrations or discharges against the applicable aircraft objects on the International Registry.
Most registrations on the International Registry require two parties to consent to the transaction, including contract of sale registrations. In other words, where a purchaser of an aircraft intends to register a contract of sale on the International Registry, the seller must have an active TUE account and consent to such registration.
Professional User Entity Authorization
To facilitate and expedite registrations on the International Registry, except in the simplest aircraft transactions, EscroAir will seek to be appointed as the Professional User Entity with regards to the affected aircraft objects (airframe(s) and engine(s)). For TUE accounts that EscroAir has established or administers, you do not need to be worried about this process as we will take care of it. However, where the TUE account is administered by another party, that party must take steps to grant the requisite PUE authorizations to EscroAir in order for us to be able to make the registrations as instructed. At the instruction of the parties, EscroAir can similarly grant the requisite PUE authorizations to another PUE account, where the registrations are being made by that other Professional User. This is sometimes required by aircraft lenders, where they intend to have the registrations made by their own specialized International Registry counsel, or in-house teams.
Despite the granting of PUE authorizations, which in effect allows the Professional User (EscroAir) to consent to registrations and discharges on behalf of the authorizing parties, registrations will usually be made using the International Registry’s Closing Room function. The Closing Room allows for the sequential and near-immediate release of pre-positioned registrations and discharges. Notifications and draft pre-registration reports will depend on the role of the parties, the functionality of the International Registry’s Closing Room, and additional instructions of the parties.
EscroAir cannot provide advice with respect to any registrations or discharges, for example, whether such registrations are required or advisable, or regarding the validity or effectiveness of such registrations. Ordinarily legal counsel for the parties would review the proposed registrations and discharges before they are submitted to EscroAir for implementation.
Priority Search Certificates
Priority Search Certificates are obtained based on aircraft objects and serial numbers. They provide a historical listing of all (if any) registrations and discharges made concerning an aircraft object. Except as provided for as a part of our escrow services, Priority Search Certificates are each provided for a fee. For example, where a person wishes to obtain searches on one airframe and two engines, this will constitute three certificates. Where an aircraft object appears more than once on the International Registry because of a variation on its serial number having been manually entered into the International Registry, EscroAir will also obtain the Priority Search Certificate on any near matches, and regardless of the variation of the manufacturer’s serial number, these will also be considered additional searches.