Registries.qxp_Finance 17/07/2018 14:14 Page 2
OWNERSHIP T REGISTRIES
“Safety is number one. There are no shortcuts. Just different regulatory regimes.”
CAMO. The Manx register, however, requires the same maintenance but it can be performed using the OEM’s manuals. Craig McLeod, head of flight operations at Naljets which has aircraft on the Manx and UK registers explains, “The Isle of Man makes life easy. With maintenance I don’t need a CAMO, so there are significant savings.” And there are plenty of other examples. Nevertheless, Paolo Lironi, chief executive of SGI Aviation which runs the Guernsey register (2-reg) under a 30-year contract that has 25 years to run, is emphatic about the main role of offshore registers. “Safety is number one. There are no shortcuts. Just different regulatory regimes.”
Why Opt for an Offshore Registry?
Some owners choose an offshore register to keep a low profile. Tim Barber, aircraft sales and acquisitions representative in Europe for Duncan Aviation, explains, “In the UK and across Europe we have the politics of envy. Certain sectors don’t like people who have made money and use or own private jets.” Putting your aircraft on an offshore register can help make that ownership less obvious. Bermuda’s VP-B and VQ-B tail numbers are seen as helpful in this respect. But offshore registers are not an easy route to anonymity for ill-gotten gains or the people who make them. The Guernsey register does background checks on where an owner is making his or her money. “We have lost a number of Chinese aircraft,” says Lironi. “Not that they were doing anything wrong, but because the owners didn’t want to open their books.” 58
AVBUYER MAGAZINE – August 2018
Barber points out that US operators are less anxious about keeping their heads down. Jet ownership in the US now has had substantial tax advantages pushed through by the Trump administration - so the US register (N-reg) is an attractive one. Some jurisdictions have bigger tax benefits than others. As examples, the Isle of Man has a corporate tax rate of 10% and no capital or wealth taxes; Bermuda has no income or profits tax; Aruba has no corporate or income tax, or VAT. But O’Sullivan downplays the importance of tax. Far more important, she says, is convenience. It makes sense to use a register in the same jurisdiction as other business interests. As one owner puts it, “I have a mortgage in Guernsey, so that’s why I prefer to register in Guernsey.” Another is the level of service. On this the various offshore registers, competing for a limited pool of aircraft, all proclaim their virtues. Jorge Colindres, founder and chairman of The Registry of Aruba (P4-reg), says: “When we decided to start the registry, we wanted to run it like a private company. “That means we are always available to customers. There are no bank holidays or national days off.” The Isle of Man, which has taken 1,000 aircraft on to its register since it was set up in 2007, also prides itself on its level of service. “We are completely digital with an online registration system,” says Colin Gill, deputy director of civil aviation.
Transparency and Clarity
The ease of finding out whether there is an existing mortgage when considering buying an aircraft – or
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