Business Jet Law

Written by experts in business jet law, 'The Guide to Business Jet Law' covers every aspect of owning, operating or financing a business jet. The guide is divided into key areas outlining all the issues an owner, operator or financier would need to consider.

Click below to see a brief synopsis of some of the issues considered in the guide:

The business jet finance market
Buying & selling a business jet
Aircraft operation and management

The business jet finance market

Most business jets are primarily used as tools for carrying on business, so it makes sense that they should be seen as assets which can be leveraged to ensure businesses are making the most efficient use of their capital.

The business jet market has seen an increasing trend towards obtaining bank finance, a process in which it is crucial for owners, sellers and financiers to know their options when investing in an aircraft that will reflect their needs.

There are various lending options available, with the most active lenders in this market being the private wealth banks. The level of finance available will vary depending upon aircraft type, aircraft age, the nature of the credit and the relationship between the owner and the financier, but anything between 50% and 80% is typical and sometimes even higher loan-to-value ratios can be justified.

Financiers need to ensure their investment is exposed to limited risks and often require extensive financial disclosure. The extent of this requirement for financial disclosure, combined with the high value many high net worth individuals place on privacy, are often reasons which steer aircraft owners to pay cash rather than look to obtain finance.

Our guide will look at business jet financing in the following areas:

  • Loan Structures vs Lease Structures
  • Pre-delivery Payments
  • Borrower / Lessee Representations, Warranties and Covenants
  • Security Documents
  • Default, Enforcement and Repossession

To find out more about the management of business jets, please get in touch with our expert team

Buying & selling a business jet

Buying or selling a business jet is a complex transaction and having an experienced business jet lawyer is essential in order to properly manage the risks and ensure a successful outcome.

What should be included in your letter of intent? Should it be binding or non-binding?

Do you know what your purchase agreement should look like?

Does your purchase agreement take account of post-delivery operational and regulatory requirements?

Read our guide for an expert briefing on the relevant issues.

To find out more about the management of business jets, please get in touch with our expert team

Aircraft operation and management

Operating an aircraft is a complicated process which requires an extensive professional support network. The annual costs of operation are considerable, typically in the region of 10% of the capital value of an aircraft asset and this cost will be managed and controlled by a professional aircraft operator or manager.

The execution of a management agreement should be viewed as a high value transaction; a detailed understanding of the treatment of costs and the scope of obligations needs to be obtained prior to entry into a management agreement and it is essential that professional legal advice should be sought.

Some owners may be willing to incur the higher cost of establishing a private flight department to manage their aircraft, but most will prefer to entrust operational responsibilities to an external management company. If an aircraft is financed, the bank will often, in any event, require that a third party operator is involved in the running of the aircraft as a way of mitigating maintenance and operating risk.

To find out more about the management of business jets, please get in touch with our expert team

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