If you have been following the news you know that, once again, a government shut-down is being used as leverage in connection with political demands. But what happens when you are trying to get an aircraft transaction closed and the government shuts down before closing? Well, when the government shut-down back in 2013 many aircraft buyers and sellers found themselves in this unenviable position. And, unfortunately, they were out of luck.
At that time, the FAA Aircraft Registration Branch (the “Registry“) was closed during the shut-down. As a result, it was impossible to file aircraft bills of sale, releases, security agreements, applications for registration etc. So deals didn’t get closed. And then when the shut-down ended and the Registry was re-opened it had a huge back-log of transactions to handle, which further delayed transactions while the Registry worked through the back-log. Not a good situation.
Now that we may be facing another shut-down should we be worried that deals will come to a screeching halt? Fortunately the answer to that question is “no”. When the FAA Authorization was passed back in September, 2018, it included a provision that will prevent this same situation from occurring again. Section 518 of the FAA Reauthorization Act of 2018 states:
The Administrator shall designate employees of the Aircraft Registry Office in Oklahoma City, Oklahoma as excepted employees in the event of a shutdown or emergency furlough to ensure that the office remains open for the duration of the lapse in Federal Government appropriations to the Federal Aviation Administration.
As a result, even if a government shut-down occurs now, during one of the busiest times of the year for closing aircraft transactions, the Registry will remain open for accepting filing of transaction documents. So, if you are in the middle of a transaction and hoping to get it closed in the near future, fear not – the Registry will be open and waiting when it is time for you to close and file your transaction documents.