Affordability and implementation of operating a plane for business or a flight department is at its peak. The knowledge an aviation transaction attorney can bring to the purchase is paramount to this big investment. Many companies don’t blink an eye at operating a fleet of trucks or cars, so many companies could take advantage of airplanes as even better business tools.
“In this economy, it’s all about knowing when and how to expand your flight operations,” said Stewart Lapayowker, aviation lawyer. “A good attorney can help you see the pros and cons of the different ownership styles.”
A study from NEXA Capital Partners that was released in late 2010 showed that small and medium businesses that used business airplanes outperformed their competition. A total of 385 businesses from the S&P Small Cap 600 were surveyed and in every single category they benefited from using planes as tools to increase: financial performance and shareholder value; boost customer satisfaction, retention and referrals; improve productivity and minimize the impact of the recession; and access more remote destinations not serviced by commercial airlines. The study shows that during the last five years, business aviation users had an earned net income at a pace of 219 percent over nonusers. Most compellingly, business aviation users earned $3.19 for every dollar earned by a nonuser.
Back in 2009, NEXA surveyed big businesses and found similar results on business aviation users surpassing nonusers on all business metrics. All these facts demonstrate that even in a down economy, business aviation is a crucial part of making any business successful. A business can still be fiscally conservative and make long-term plans that include planes, and an aviation attorney can make the purchase, financing, and management of corporate aircraft a smart, calculated decision.
After a buying team is chosen, an attorney can help with negotiations, creating and executing legal documents as well as purchase agreements, leases, and charter management agreements. From there, a lawyer will assist with the registration with the Federal Aviation Administration and International Registry and provide advice on stateside and international operation of the airplane. Many companies have their tax advisors work with an attorney to go over federal and state taxes, ownership structures, and tax-deferred exchanges. A business’ insurance agents also are a critical factor and will work with a lawyer to control and limit exposure to risk in an economic and efficient policy.
“Advising clients on how to maximize the benefits and decrease liabilities when buying a plane, setting up a flight department, and managing the operations is key,” said Lapayowker, whose law firm in Fort Lauderdale, Fla., focuses on private and corporate aviation transactions worldwide, from the United States, South America, the European Union, Asia and the Middle East. “There are so many legal, regulatory, tax, operational, and financial considerations to be well versed in.”