.Last Thursday and Friday, nearly 100 members of the European business aviation community gathered in Vienna for the European Business Aviation Association’s “One Europe” Regional Forum
It was clear early on that this would be a conference with a difference. Foregoing dreaded PowerPoint-aided speeches (ok there was one – but from a former Austrian Minister of Finance, so wholly permissible), the audience was instead engaged in lively debate led by an “armchair panel” of operators and experts.
Much discussion focused on the terribly unlevel playing field in Europe created thanks to the numerous different ways in which European National Authorities interpret and enforce various EU Directives. One example is the interpretation of private vs. commercial flights. The water gets particularly muddy when you have, for example, a private owner flying in an aircraft being operated by the commercial operator he has engaged to manage it. Is this a private flight and therefore traffic rights permits are unnecessary? Or is it commercial and therefore subject to cabotage rules? Is Private or Commercial determined by the flight, the user or the operator?
And why are certain safety regulations - i.e. runway performance standards - divided between Private and Commercial? Is an accident any less serious depending on whether or not the passenger is paying?
Another important topic concerned the complexities of flying into Russia, where some airport handling fees can be excessive, and where aircraft needing an emergency repair have lingered for months in hopes of getting the required spare part successfully past archaic customs rules.
Discussions about insurance (“Why would any operator sign for an insurance without understanding what his policy really covers?” questioned Aiofe O’Sullivan, Partner at Gates and Partners Law Firm), financing and taxation revealed just how much frustration there is among operators trying to unravel and understand the small print and red tape involved in securing a new aircraft. VAT regulations in and of themselves change from country to country. We learned how in Italy, if a commercial operator imports an aircraft registered outside the EU, a cash or check has to be handed over to tax authorities directly, whereas for an aircraft imported from within the EU, the VAT can be offset within a company’s yearly balance book. Furthermore VAT rates vary wildly from country to country, and while in Switzerland a commercial operator must prove in its flight logs that the aircraft has been used for private purposes for only 5% of the time to qualify for VAT exemption, in other countries commercial operators have adopted a 50-50 rule.
Are you still with us?
In the midst of this spaghetti of confusion, the EBAA has taken onboard the various issues raised at the forum and will in the coming weeks assign focus groups to work on them, seek clarification from EU and National Authorities on some of the more opaque regulations, draft position papers or statements, and then with the EBAA Board and Secretariat’s backing, work with authorities to enact tailored and harmonized rules for business aviation across Europe.
As Brian Humphries, CEO and President of EBAA exclaimed at the conclusion of the meeting: “There’s work to be done!”