February 23, 2021 (*UPDATED September 25, 2022*)

Avoiding Pitfalls When Exporting Aircraft from the United States

Holland & Knight Alert
Jonathan M. Epstein | Libby Bloxom


  • The significant increase in aircraft seizures over the last two years and potential enforcement actions by the U.S. Department of Commerce Bureau of Industry and Security (BIS) have highlighted the need to ensure compliance with U.S. export laws.
  • Sellers, buyers, brokers and others involved in the sale or lease of aircraft for operations by foreign parties need to cooperate with each other to ensure exports are done properly and in compliance with U.S. export laws, including making an Electronic Export Information (EEI) filing when required in connection with the export of aircraft.

Update: This Holland & Knight alert has been updated on Sept. 25, 2022, with additional information.

In plain English, anytime an aircraft departs the United States, this is an "export" and will fall in one of two "buckets": temporary exports – where the aircraft will fly under its own power on a temporary sojourn, such as carrying passengers or cargo from the U.S. to Mexico, where it is intended that the aircraft will return to the U.S. within one year and there is no transfer of control; and permanent exports – where the aircraft is physically exported (i.e., flown) from the U.S. as part of a sale, lease or transfer of possession and control to a foreign person, or is otherwise intended to be based out of the U.S. for one year or more.1

Unfortunately, determining when and whether there will be a permanent export is not always straight-forward. Unlike most goods that move in commerce, when an aircraft is sold or leased to a foreign party, it often departs the U.S. as its own conveyance. However, many of the same basic export requirements apply, as if the aircraft had been boxed up and sent as freight to the foreign country. This process is confusing for a number of reasons:

  • Parties may confuse requirements such as deregistration with the Federal Aviation Administration (FAA) and issuance of an export certificate of airworthiness with requirements under U.S. customs and export laws, in particular the need to make an Electronic Export Information (EEI) filing.
  • Even aircraft that remain on the FAA registry may be permanently exported for customs and export control purposes. For example, aircraft owned by U.S. lessors (or a U.S. trustee), where the operator intends to base the aircraft outside the U.S., would still be considered a permanent export under U.S. customs and export laws.
  • The export of an aircraft to be principally hangared and maintained in a foreign jurisdiction for more than a year would constitute a permanent export, even if the aircraft regularly flies into the U.S.
  • U.S. export regulations, which dictate the responsibility to determine export requirements to certain parties, can be difficult to apply to certain aircraft export transactions.

What Is an EEI Filing?

The EEI is an electronic submission of export data filed through the Automated Export System (AES), administered by U.S. Customs and Border Protection (CBP), although the Foreign Trade Regulations (FTR) governing EEI filings are administered by the U.S. Census Bureau (Census).2 The EEI contains details, such as the parties to a transaction and ultimate consignee, the export classification of the item, value and other data that is both for statistical and law enforcement purposes. Once filed, the AES will generate an Internal Transaction Number (ITN), which should be listed in export documentation.

When Is an EEI Filing Required?

The EEI is generally filed prior to the permanent physical export of the aircraft from the U.S. More particularly, if the intent is to base the aircraft abroad for more than a year, then the first flight out of the U.S. would be a permanent export, and an EEI would generally be required, regardless of whether the aircraft is owned or operated by a U.S. person (i.e., it would apply to aircraft on lease and held in trust by U.S. lessors). However, EEI filings are not required for permanent exports to Canada. Conversely, an EEI would not be required where the aircraft is temporarily exported and intended to be based out of the U.S. for less than one year or where there is no physical export from the U.S. (for example, if an aircraft is sold domestically to a foreign entity in the U.S. that intends to base the aircraft in the U.S.). Many aircraft exports fall under the following examples:

  • An aircraft is sold to a foreign buyer, but the aircraft is principally hangared and maintained in the U.S. The aircraft's flights abroad would not be permanent exports and no EEI filing would be required.
  • If the aircraft is principally hangared and maintained outside the U.S., but for no more than a year, no EEI filing is require under 15 C.F.R. § 30.37(q) as this is a temporary export.
  • If the aircraft is exported and principally hangared and maintained in the foreign country for more than a year, it is a permanent export and an EEI filing is required.
  • An aircraft is considered principally hangared and maintained in the U.S. where:

1) the owner/operator has a long-term hangar lease/license for the aircraft in the U.S. (and not in any foreign jurisdiction);

2) the owner/operator has (or intends to have) periodic maintenance (other than pre-flight or emergency maintenance) predominantly conducted in the U.S.; and

3) the aircraft does not remain outside the U.S. for more than one year without returning to the U.S.

  • When a determination cannot be made as to whether the aircraft is principally hangared and maintained in the U.S., if at least 50 percent of its flights (or series of flights) are either domestic U.S. flights or international flights (or series of flights) that commence or end in the U.S., then the aircraft is considered principally hangared and maintained in the U.S.

Note: An aircraft that previously was permanently exported and is brought into the U.S. for repair or improvement must be properly imported, and subsequently an EEI filing made on export.

Who Is Responsible for Making the EEI Filing?

Generally, the U.S. Principal Party in Interest (USPPI) is responsible for making the EEI filing but will often appoint a forwarding agent (typically a customs broker) as the "authorized agent" to make the filing on its behalf. The USPPI is the "person or legal entity in the United States that receives the primary benefit, monetary or otherwise, from the export transaction. Generally, that person or entity is the U.S. seller, manufacturer, or order party, or the foreign entity while in the United States when purchasing or obtaining the goods for export."3 In an aircraft transaction, the USPPI would typically be the seller or lessor, as that is the entity that receives the financial benefit from the sale.

However, in most general aviation transactions, the foreign buyer or lessee takes delivery of the aircraft in the U.S., and the foreign buyer is responsible to authorize a U.S. authorized agent, via power of attorney or written authorization, to make the EEI filing on the foreign buyer's behalf. These are "routed export transactions," a subset of export transactions, where the Foreign Principal Party in Interest (FPPI) authorizes a U.S. agent to facilitate the export of an aircraft from the U.S. and make the EEI filing on the FPPI's behalf.

Who Is the USPPI if the Foreign Buyer Is Temporarily in the U.S.?

If the foreign buyer is temporarily in the U.S. to accept delivery in the U.S., the foreign buyer is the USPPI, the FPPI and also typically the consignee. The foreign buyer would use an authorized U.S. agent to make the EEI filing on its behalf. A foreign buyer is temporarily in the U.S. if it has a representative temporarily in the U.S. to obtain the aircraft with authority to make decisions and act on behalf of the foreign buyer.

For example, if the foreign buyer authorizes its non-U.S. chief pilot to complete the inspection, sign the delivery receipt and fly the aircraft out of the U.S. following closing, the foreign buyer would be the USPPI, and the chief pilot's passport number is reported as the USPPI ID number on the EEI.

If the foreign buyer does not have an authorized representative temporarily in the U.S. to obtain the aircraft, then the foreign buyer, as the FPPI, would authorize a U.S. authorized agent to make the EEI filing on its behalf. The USPPI would be responsible for providing certain information to the FPPI's authorized agent in order to complete the filing. The USPPI would not be responsible for filing the EEI, unless it obtained authorization from the FPPI to make the EEI filing as the FPPI's authorized agent. However, the USPPI should retain certain records, including the export information it provided to the authorized agent to support the EEI filing, and a best practice would be to obtain from the authorized agent the ITN number, date of export and filer name.

For example, the foreign buyer arranges for foreign contract ferry pilots (who do not have authority to make decisions and act on behalf of the foreign lessee) to fly the aircraft out of the U.S. following delivery. The seller would be the USPPI and the foreign buyer, as the FPPI, would appoint a U.S. authorized agent to make the EEI filing on its behalf. Note the analysis would be the same if the foreign buyer hired a U.S.-based ferry flight company, as such entity is permanently in the U.S.

Applying these rules to some aircraft export transactions is difficult, and even experienced customs brokers/government officials can reach different conclusions as to which party should be the USPPI or FPPI and whether a transaction is a routed export transaction or not. For example:

  • While in some circumstances the aircraft broker that both helps negotiate the transaction and arrange the export could act as the USPPI, in general, the U.S. government would consider whether there is an appropriate principal party (e.g., seller, buyer, lessor or lessee) that would be the more appropriate party to act as the USPPI.
  • Further, the U.S. government has advised that if a party (e.g., U.S. seller or U.S. maintenance facility improving an aircraft post-closing) is the proper USPPI, such party cannot disclaim such obligation or refuse to provide information necessary for the EEI filing.
  • In general, a trustee would not be a principal party and hence not the USPPI or FPPI, as in normal practice, the trustee would never be involved in negotiating the purchase or arranging the export of the aircraft from the U.S. However, there may be circumstances where, in the absence of a proper party to serve as the USPPI, the trustee could agree to serve as the USPPI.

What Is the Process to Correct a Failure to Make Past EEI Filings?

Census, in coordination with the U.S. Department of Commerce Bureau of Industry and Security (BIS) and CBP, have issued informal guidance on how to make corrective EEI filings and separate procedures for aircraft held in trust by one trustee that is subject to ongoing legal proceedings. In general, these processes apply to aircraft exports made before April 23, 2021.

While making such filings does not relieve the party who originally should have filed the EEI from potential civil penalties, in general, U.S. government agencies appear to be treating this as an "informed compliance" matter, and have not been penalizing entities for failure to timely make filings when corrective filings are made, absent aggravating factors, and it is believed that several hundred of such corrective filings have been made in the last 18 months.

  • It is recommended that parties work with a U.S. forwarding agent (e.g., customs broker) experienced in aviation transactions in making the corrective filings.
  • Unlike import clearance procedures, the aircraft need not be physically in the U.S. to make the EEI filing.
  • If the original export was before Jan. 1, 2000, the AES system will not accept a filing and your broker would need to contact Census for instructions.

While there is a five-year federal statute of limitations on past export violations, parties whose aircraft were exported more than five years ago should consider making corrective filings for the following reasons: there is a risk of having aircraft detained by BIS, buyers acquiring aircraft from abroad are asking for proof of proper export, and any person that knows that an aircraft was exported in violation of U.S. export laws is prohibited from engaging in transactions involving such aircraft until corrective action is taken.

Who Is the "Exporter" and What Are the Restrictions on Exporting?

The term "exporter," under the Export Administration Regulations (EAR), is defined as "[t]he person in the United States who has the authority of a principal party in interest to determine and control the sending of items out of the United States."4 The exporter is generally the USPPI and is the party generally responsible for determining licensing authority (i.e., determining whether the aircraft export requires a license, falls under a license exception or qualifies for no license required). The principal exception to the USPPI being the exporter is, in a routed export transaction, if the USPPI obtains written confirmation from the FPPI that the FPPI will be responsible for determining licensing authority. In such case, the authorized agent of the FPPI is the exporter under the EAR.5

The EAR applies to the physical export of civil aircraft from the United States to a foreign country, regardless of whether the aircraft is flying on a temporary basis or for permanent export. However, most civil aircraft do not need a license to export to most countries under the EAR or U.S. economic sanctions. However, exports are generally prohibited to sanctioned countries, such as Cuba, Iran, Syria, Sudan, North Korea, Russia, Belarus, and the Crimea, Luhansk and Donetsk regions of Ukraine; certain persons on barred entity lists, including the Entity List, Denied Persons List and Specially Designated Nationals (SDN) List; or certain barred end-users/end-uses (such as military end-users/end-uses in Burma, Venezuela and China).

U.S. parties should properly vet the foreign counterparties (including the beneficial owner of the purchaser as well as the end-user) before transferring title to ensure that the aircraft will not be diverted to an unlawful end-user, end-use or destination in violation of the EAR or U.S. economic sanctions. Even if the buyer is not designated on one of the above lists, U.S. parties should be alert for and cautious of any "red flags" of possible illegal activity, such as funds from various sources not associated with the buyer, a buyer who is evasive about disclosing the end-user or a buyer who refuses to provide information about its beneficial ownership.

What Are Some Tips to Ensure Compliance with Export Requirements?

The export clearance process is an inexpensive ministerial process, but failure to follow the procedures can result in fines or even aircraft seizures by the U.S. government. Regardless of your role as seller, buyer, broker, trustee or outside counsel, it is important to collaborate with other parties in the transaction on export clearance in the same way parties work to ensure that deregistration and export certificate of airworthiness issues are properly handled. While not comprehensive, below are some tips for complying with the export clearance process when exporting from the U.S.

  • The U.S. seller and other U.S. parties should not simply rely on the foreign buyer or other party to "get it right" on export clearance, but rather work with the entity responsible for the filings. For example, by ensuring that the party responsible for the EEI filing has/will engage an authorized agent experienced with aircraft exports. In addition to filing the EEI, an authorized agent can provide the ITN, evidencing the EEI filing, and other documentation needed by the flight crew to clear customs, arrange for preparation and annotation of export documentation, and advise on specific requirements which may vary depending on the airport at which the aircraft is clearing customs for export purposes.
  • Note that the first page of the airway bill, export shipping instructions or other commercial loading documents (e.g., export manifest) must be annotated with the ITN.6
  • The purchase agreement should clearly delineate which party is responsible for arranging and paying for export licensing and clearance, consistent with the restrictions in the regulations (i.e., certain responsibilities may not be contractually disclaimed). In addition, it is recommended that the purchase agreement contain export control language, and a "destination control statement" should be included on the commercial or pro-forma invoice prepared for export purposes.7
  • Be cognizant that an aircraft departing the U.S. (whether for permanent or temporary export) must comply with certain filing requirements, such as pre-filing an electronic manifest. For example, private aircraft must not depart the U.S. to travel to a foreign location until CBP confirms receipt of the appropriate manifest and departure information, and grants electronic clearance via electronic mail or telephone.8 In addition, some foreign countries require filing of advance notice of arrival.
  • In some cases, an aircraft will be loaded with spares or other items that may be considered cargo. If this is the case, check with the forwarding agent, as such items may need to be separately declared and identified in the EEI for export purposes (and for import into the destination country).
  • Parties should retain records of proper export. Note that the EEI is confidential, and the USPPI and authorized agent generally cannot share the EEI with anyone, including the FPPI.


1 This Holland & Knight alert provides an overview of customs and export control clearance issues when exporting aircraft from the United States. It should not be construed as legal advice with respect to any particular transaction or export. In particular, the specific facts and circumstances of each transaction/export will dictate the responsibility of each party under U.S. law.

2 15 C.F.R. Part 30.

3 15 C.F.R. § 30.1 (defining "U.S. principal party in interest").

4 15 C.F.R. Part 772 (defining "exporter" and also defining a "principal party" as "those persons in a transaction that receive the primary benefit, monetary or otherwise, of the transaction. Generally the principals in a transaction are the seller and the buyer. In most cases the forwarding or other agent is not a principal party in interest."). The term "exporter" or "exporter of record" is not a term used in the FTR governing EEI filings.

5 See 15 C.F.R. § 758.3 (Responsibilities of Parties to the Transaction).

6 See 15 C.F.R. § 30.7.

7 See 15 C.F.R. § 758.6.

8 See 19 C.F.R. § 122.22(c).

Information contained in this alert is for the general education and knowledge of our readers. It is not designed to be, and should not be used as, the sole source of information when analyzing and resolving a legal problem, and it should not be substituted for legal advice, which relies on a specific factual analysis. Moreover, the laws of each jurisdiction are different and are constantly changing. This information is not intended to create, and receipt of it does not constitute, an attorney-client relationship. If you have specific questions regarding a particular fact situation, we urge you to consult the authors of this publication, your Holland & Knight representative or other competent legal counsel.

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