FAQ

FAQ

Hi, Ome aspect of operating an N-reg in Europe is still unclear to me. US law stipulates that only US citizens, US residents and US Registered companies may operate N-reg aircraft. How is this covered by your legal construction ? Thank you for your time. Hans

In order to fly a N-aircraft, each EU citizen has indeed to create a US trust, legal owner of the aircraft.
Our « Papa Charly » companies just operate the flights. They have no effects on the property of the aircrafts.
But since the aircrafts are operated outside of EASA country, we avoid the new EU legislation about FAA licences and N-aircafts (conditions for IFR flights, maintenance, etc.).

I heard Morocco prevents to export the money placed on Moroccan bank accounts… How can we be sure that the money we put in our bank accounts wont be blocked ?

That was the only serious worry about Morocco: it is true that Morocco usually allows to export only 70% of the money you put on a Moroccan account.

That’s why we had to negociate with the Office des Changes, in Rabat.

They just made an offical decision for exemption from this rule: our pilots will have a free disposal of the whole money they pay on their accounts, and a credi card in euros.

We publish this decision on this website.

That is a really great news !Office des Changes Décision p. 1

Office des changes Décision p. 2

I am Belgian, owner of a Rockwell Commander registered “N”. Would fuel and maintenance that I pay with Moroccan money be exempt from VAT, since it seems to be an exportation?

Sorry for you: your Moroccan operator will be useful for many things, but not to save on taxes: VAT is due at the place where the actual characteristic performance is taken place (concretely).
So if you change a wheel in Liege, this work physically takes place in Belgium.
If you purchase merchandise at Spa and it is delivered to Geneva, the place of the characteristic performance is in Switzerland, with the possibility to exempt.
The creation of “Papa Charly Aviation companies” is not a service “exported” to Morocco, in fact. All operation happen in Europe although they are paid by Moroccan funds.

What is the procedure to create a company ?

The procedure is described here.
Once we receive all compulsory documents, we contact the Moroccan Authorities, banks, bodies of credit cards and subcontractors for flights preparation.
The process takes approximately 15 to 20 days in order to create your company (100% yours), statutes, bank account and corporate credit card.

Why Morocco, and not Gibraltar, Malte, Man Island, Guernesey or USA ?

Morocco is indeed the perfect place to create such operators:

– Moroccan taxes are particularly friendly with investors importing foreign currencies and change (cf. this website),

– Policy is stable,

– Banking system works very well, especially when you know the right people,

– Over several business years in Morocco, we have built an extensive network in business, justice and administration,

– Rent and staff salaries are not expensive,

– There are scheduled flights to Marrakech Menara Airport with easyJet almost every day from most cities in Europe,

– It is one of the closest destinations outside of Europe,

– It is a french speaking country.

All these components lead to why Morocco is indeed the perfect location to create functional operating companies and not only mailboxes with fictitious domicile in tax havens countries such as Gibraltar, Guernsey, Isle of Man, Malta, Bahamas, Delaware, etc. This last point is particularly important to deal with aviation authorities.

We are at your complete disposal for assistance and support.

And what about the BASA discussions ?

Look… The first discussions started years and years ago.
The agreement has been rejected by the US.
Now there are some new discussions, but nothing about equivalence.
It will be anyway mandatory to follow European training and tests to get licenses/ratings conversions.
European Authorities have worked during many years to make these law, in order to raise up the US standards, lower than European ones. Right or wrong, one thing is sure: this strong willing means that Europe will never agree to convert FAA into JAA licenses without training and tests.

The latest conversion rules are lighter than some months ago. In this case, is it still worth to create a company in Morocco?

It is true that EASA and national authorities make some efforts to make it easier to convert FAA to FCL licenses.

It is however your choice.

Some will comply with the new rules and will agree to spend time and money to make their conversions.

Others will choose legitimate solution allowed by the law itself. They perhaps don’t have the choice because they don’t have enough time or money to pass practical flight exams (impossible on their “N” aircraft), Type Rating on their aircraft or English FCL055.

And remember that it will no longer be legal to fly IFR with a “N” airplane not equipped under IFR conditions according to European rules.

I’m pretty sure European law has a notion where a construction solely aimed at circumventing a law/regulation is considered abusive and void. Is it the case with these operators in Morocco ?

You are right: if a legal construction solely aimed at avoiding a law, it would be considered abusive. Not only in EU law, but in all the EU countries as well.

That’s why we clearly asked the authorities: If a foreign company operates private flights, can you confirm that the new regulation won’t apply ?

The answer was the same as that of other lawyers:

1) private flights may be operated by an operator which is not the pilot-in-command,
2) if the company really operates the flight, it will not be considered abusive,
3) in this specific circumstance, if the operating company is based out of Europe, the law doesn’t apply,
4) the pilot can continue to fly with FAA licenses and ratings even after April 8th 2015,
5) this pilot can continue to fly with his aircraft and IFR under US conditions of equipment and maintenance.

EASA wants us to have EASA licenses… Isn’t there a risk to bypass the law ?

EASA implicated new laws with the help of lawyers and specialists. Parliament needed 7 years to stipulate the final version. Each word of the law has been thought and measured.

The fact is that the “foreign operator” exception is a full and official part of this law.

So we are not “bypassing” the law, we only apply it completely.

And if European Parliament decides to change the law ? It would take many years, but we guarantee a “Refund“.