The USA is by far the largest private jet market. It accounts for roughly 70% of the pre-owned buyers annually. Because of the size of the buyer pool, it is likely that European owners will have leads and potential buyers come from the USA.
A common request from buyers based in the USA is to perform their Pre-Purchase Inspection in the USA. Usually it is because they feel it is easier for them to have the aircraft closer to home and often in the facility they plan on basing the aircraft at. This request can be satisfied, but a number of details must be thought through from the seller’s perspective.
Tips for non-American owners considering a USA PPI:
- Distance – With a PPI being performed so far away from your base, you will want to send your broker or someone else from your team who will look out for your interests during the inspection or hire someone in the USA to do this. Also understanding how you and your lawyers will manage the time zone difference is important.
- Movement Costs – Some sellers are ok with paying for the aircraft to fly to the USA. However, we recommend to our clients that this be at the buyer’s expense as the reason for the aircraft to go to the USA was due to the buyer’s choice. Similarly, there should be an agreement of who pays for the costs of movement if the deal does not complete and the airplane needs to return to its homebase. This way, if for whatever reason the transaction does not complete, the parties have a full understanding in advance of what the flight costs and ramifications are.
- Customs – A customs export will need to be attained when the aircraft leaves European airspace. The aircraft will then have to undergo a customs import into the USA when it arrives on its soil. These are normal tasks that can easily be accomplished with forward planning, but again, if the deal falls apart, the seller will have to do this process in reverse to bring the aircraft back home.
- Taxes – The physical location of the aircraft is important when closing a transaction in America, just as it is in Europe. Knowing which states require a sales tax or a usage tax is vital. There are several good options depending upon the buyers circumstances. We find that Connecticut is commonly used as it is exempt from sales tax on any aircraft over 6000 lbs max take off weight and there are two very large manufacturer owned maintenance facilities there.
Performing a PPI in the USA is not a rare event nor even one that we discourage, but it does require extra planning and protection of your interests when the inspection occurs so far away. Your broker should have indepth knowledge of this procedure and can advise on what is best for your particular aircraft and requirements.
Process for performing a USA PPI:
Export from EU
Fly the aircraft to the USA
Import the aircraft into the USA
Fly to the Facility
Perform Pre-Purchase Inspection
Close the Transaction