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Interchange Agreements Aircraft

Traditionally, Brazilian operators are prohibited from operating aircraft registered in other countries. As a result, the first exchange agreements concluded in the country concerned aircraft registered in Brazil. The RAB recently authorised the registration of foreign-registered air transport aircraft exchange contracts, provided it is a Brazilian operator. The origin of the exchange idea needs to be explained. If your aircraft is not on a commercial certificate, you cannot normally use it to allow transport for compensation. You could rent it to someone who provides their own pilots, but if you equip the aircraft and you even have a crew member and compensation, the FAA will call the flight commercial. Traditionally, this was also the case when compensation was not money; This could have been useful to any passenger, including your passenger, who will provide you with transportation on their plane. In other words, trading time on your plane for time on someone else needs a commercial certificate from the FAA. But in 1972, when the agency realized that these time trading agreements were in progress, it decided to legalize them. Since the FAA used the term “time-sharing” to refer to a completely different agreement, it chose to characterize the arrangements as “exchange.” According to FAR 91.501, “a person in an exchange contract rents his plane to another person in exchange for the same time, if necessary, on the other person`s plane, and no charges, charges or charges are charged.” It sounds simple. But say I`m trading time on my Global 5000 for time on your Cessna Bravo Citation. The hourly operating costs (not to mention the fixed fee) are almost four times higher for my overall than for your Bravo, so if we act every hour, you pretend to be a bandit.

Eligible fees Fortunately, the FAA has taken this issue into account. In an exchange agreement, the Agency allows me to charge you an amount “that does not exceed the difference between the costs of owning, operating and maintaining the two aircraft.” This can clearly mean more than direct operating costs. However, the great of the FAA has confused many jet owners. Suppose the hourly cost of the flight is $10,000 for my total and $2,500 for your Bravo. We sign an exchange contract in which I fly 10 hours with your congratulations, and you steal 10 on my global. As my overall costs four times more than your Bravo, I just bought the most expensive flight time in history. But here`s what saves the day: our exchange contract can provide that you pay me the difference between the cost of owning, operating and maintaining the two planes which, in this case, will be $75,000 ($7,500 per hour times 10 hours).

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