The Federal Aviation Administration has invalidated the registrations of more than 700 U.S.-registered aircraft after determining that a company that arranges foreign registrations under a trust agreement did not meet U.S. citizenship requirements when it submitted aircraft registration applications.
In a notice issued Jan. 13, the FAA said all Certificates of Aircraft Registration associated with Southern Aircraft Consultancy Inc. (SACI) are invalid and must be surrendered within 21 days, a move that results in the immediate grounding of affected aircraft worldwide.
The FAA said Southern Aircraft Consultancy registered aircraft for both U.S. citizens and foreign nationals using trust agreements, which require the trustee to either be a U.S. citizen or a resident alien.
“The FAA found that SACI violated FAA regulations regarding U.S. citizenship requirements,” the agency said in its statement.
Aircraft owners now must re-register either through another country’s registry or by submitting a new application to the FAA to regain legal operating authority.
Why Trusts Are Used for N-Registration
Under FAA rules, aircraft owners outside the U.S. are allowed to use trust arrangements to register and operate N-registered aircraft, so long as the trustee meets U.S. citizenship or residency requirements. These arrangements are often for business and general aviation aircraft in order to access the U.S. registry’s broad international acceptance, along with the U.S.’ framework for maintenance approvals, financing, and lien recording.
The FAA’s action against SACI does not concern the use of trusts in general, but whether the trustee in this case met eligibility requirements at the time the registrations were submitted.
Southern Aircraft Consultancy Responds
In a statement sent to clients on Jan. 13, Southern Aircraft Consultancy said the FAA’s decision was unexpected and said it disputes the agency’s interpretation.
“This letter comes as a complete shock,” the company wrote, adding that it believes it is compliant with FAA regulations based on previous legal advice. The company said it is challenging the decision and pursuing a transfer of the business to a U.S.-based trust company in an effort to restore compliance and minimize disruption to clients.
Impact on Aircraft Owners and Operators
The grounding has had immediate operational consequences for some aircraft owners, including Channel Islands Air Search, a volunteer-led aviation charity that provides 24-hour airborne search-and-rescue support across Guernsey, Jersey, and surrounding French and British waters. The organization said its aircraft is currently unavailable as a result of the FAA action.
“A regulatory technical issue relating to our aircraft registration provider has resulted in a recent decision by the United States Federal Aviation Administration to ground hundreds of aircraft globally, including the Channel Islands Air Search aircraft,” the charity said.
It added that it has initiated the process to transfer its registration but has no confirmed timeline for returning to service.
AOPA UK said the FAA action is administrative rather than safety-related.
“This action relates solely to aircraft registration eligibility. It does not relate to airworthiness, maintenance standards, or flight safety,” AOPA UK CEO Martin Robinson said, while advising owners and operators to confirm whether their aircraft are affected and to seek independent legal guidance.
