A Guide To The Private Jets And Helicopters Owned By Sanctioned Russian Billionaires
International Trade and Aviation Law attorney Jonathan Epstein was quoted in a Forbes article about the impact of EU, U.S. and U.K. sanctions on private jets and helicopters held by sanctioned Russian billionaires, particularly those with aircraft that have been recently de-registered in the Isle of Man and Bermuda.
Registering aircraft in offshore jurisdictions such as the Isle of Man allows billionaires to save hundreds of millions of dollars in customs and sales taxes when flying, buying or ultimately selling their jets. The websites for offshore aircraft registries openly tout a variety of benefits, ranging from zero taxes on import duties or transfers of aircraft in Aruba to no taxation at all in the Cayman Islands.
The measures taken by authorities in the Isle of Man and Bermuda are now putting those benefits out of reach. According to Mr. Epstein, an aircraft that has been de-registered becomes a “stateless aircraft,” meaning it no longer has a valid certificate of airworthiness. Without that, it’s not insurable and cannot fly, until it’s registered in a new country.
That means any aircraft located in countries that have sanctioned Russia are at risk of being grounded. Complicating matters further is the fact that the comprehensive sanctions bar any insurers and banks from financing or providing insurance to aircraft owned or used by Russian entities.
Seven of the 18 aircraft tracked by Forbes were last recorded in France and Latvia, both of which have implemented the EU sanctions on Russia. But if they aren’t in the EU or the U.K., then the aircraft could re-register elsewhere—including in Russia, where four of the aircraft were last seen. “If they're physically in Russia, it may be that the Russians are going to re-register them,” said Mr. Epstein.
Another likely destination for these planes: the United Arab Emirates. At least three of the 18 aircraft tracked by Forbes were last seen in the U.A.E., and several more recently traveled from there to Moscow. Still, even if a plane is in Dubai, the owners could be hit by secondary U.S. sanctions on local companies that assist in moving or repairing their jets. "If you have a Gulfstream sitting in Dubai, the export of that aircraft to Russia is a violation of U.S. export laws," Mr. Epstein stated. "It's also an export violation for the repair facility that's helping them do that."