Bermuda has just suspended the airworthiness certificates of all Bermuda-registered jets in Russia. This might seem random given all the sanctions that Russia is facing, but this is more significant than you might think… sort of.
In this post:
Many Russian planes are registered in Bermuda
As of March 13, 2022, the Bermuda Civil Aviation Authority (BCAA) has provisionally suspended all certificates of airworthiness of Bermuda-registered aircraft operating in Russia. The reason this matters is because roughly half of the commercial jets in Russia are registered in Bermuda (including a majority of the planes that are leased).
International sanctions make it hard for Bermuda to maintain safety oversight of these Russian operated aircraft, meaning that Bermuda can no longer confidently verify that these aircraft are airworthy.
Why are so many planes flying in Russia registered in Bermuda? There are a few reasons, including lower import duties, better safety oversight, and easier and better insurance options. The process of trying to re-register aircraft in Russia is currently taking place, but that also has its complexities.
Why this doesn’t matter all that much
Under normal circumstances, half of a country’s commercial aircraft losing their airworthiness certificates would be really significant. But at this point it probably doesn’t matter all that much:
- Russian airlines have almost entirely suspended international flights, so demand for air travel is a fraction of what it once was; airlines don’t need all of their planes
- With sanctions in place, hundreds of Russian jets are supposed to be seized, as lease agreements have been terminated; however, Russian airlines are refusing to return these jets, and repossessing them in Russia isn’t exactly easy right now
- Many Russian planes are without insurance now, but even so, continue to fly
On the surface it’s significant that half of Russia’s commercial jets are officially no longer considered (legally) airworthy. Then again, Russian airlines are illegally refusing to return planes to leasing companies, so I’m not sure Russian airlines care much more here either?
Bottom line
Aviation regulators from Bermuda have suspended the airworthiness certificates of the hundreds of jets registered in Russia. This move comes as the regulator can no longer confidently speak to the airworthiness of these planes.
While this would usually have major implications, Russia no longer cares about international laws, so this is likely all a moot point.
What do you make of Bermuda revoking the airworthiness certificates of planes in Russia?
While Russia ( or the Russian operating companies) may seize these aircraft for a short term win, it will fundamentally destroy the creditworthiness of any of these Russian leasing and airline companies longer term. ( Not that the collapse of the ruble hasn’t started that process). It took Russia nearly ½ a century to rebuild its credit after the Revolution- and that was with the wind assist of WW2 lend lease.
It will be interesting when Boeing, Airbus, Rolls Royce, GE, and Pratt and Whitney refuse send parts.
A friend sent me the following information about the effect of sanction on Russia on aviation industry:
All over the word airlines don’t own their own planes, they lease them. The European Union has imposed sanctions on Russia and obliged European leasing companies to take back all leased aircraft from Russia by March 28th. That is a total of 520 aircrafts.
1. The Russians say if you refuse to lease them to us, get them...
A friend sent me the following information about the effect of sanction on Russia on aviation industry:
All over the word airlines don’t own their own planes, they lease them. The European Union has imposed sanctions on Russia and obliged European leasing companies to take back all leased aircraft from Russia by March 28th. That is a total of 520 aircrafts.
1. The Russians say if you refuse to lease them to us, get them back yourself! How can we get 520 crews to Russia when the airspace in Russia, Belarus and Ukraine is closed? We can’t fly in to take them back. How the hell can the 520 aircrafts can be returned to Europe?
2. Once the handover has taken place in Russian airports, the planes are no longer Russian. But a non-Russian plane is not allowed to fly in Russian airspace – the Russian airspace is blocked! We won’t be able to fly out!
3. The leasing companies are the initiators of the termination of these leases. In the original calculation of the cost of fines in such a case, we will all be bankrupted at once. It’s easier and cheaper to go bankrupt than to take back the planes.
4. February is over and Russia has to pay the lease payments for the month. Russia is willing to pay but cannot pay because it is excluded from SWIFT. We ourselves have to pay fines because of the terminations, but in view of the lack of incoming payments from Russia we have no money for such payments!
5. Even if we take back these planes, what are we going to do with them? We don’t need them, nobody wants them and it’s impossible to sell them!
6. The Boeings of American leasing companies are not affected. If Europe takes the planes away from the Russians, the US will supply Russia with its Boeing planes and become the world’s No. 1 airline, bankrupting both the European leasing company and Airbus.
My guess is that while the leasing companies cannot seize the planes in Russia, at some point they will regard those planes as having been stolen. Not a good thing. The moment any of those planes land in an EU country or country participating in sanctions they could be seized. While that may not happen for a while, I would imagine this has done greivous damage to Russia's ability to lease anything in the future....
My guess is that while the leasing companies cannot seize the planes in Russia, at some point they will regard those planes as having been stolen. Not a good thing. The moment any of those planes land in an EU country or country participating in sanctions they could be seized. While that may not happen for a while, I would imagine this has done greivous damage to Russia's ability to lease anything in the future. Through his wreckless actions, Putin is pulling the iron curtain down again, and I cannot believe Russian citizens are going to be too happy about that. No wonder many are fleeing.
So that is why Russia and China have soft currency- no respect for laws.
You have to question this war?
Was Afghanistan, gulf 1 and 2 not wars? Or is it only a war if America calls it a war. America threats to China , Iran
Think they should pull there nose in as they are the bully on the block. They will not be happy bunnies if China supplies Russia and imposes sanctions on them before starting there own expansions.
Doesn't this also mean that any planes that are outside Russia can't fly back to Russia where they can avoid repossession.
It will keep them grounded until they can repossessed the plane.
There's a difference between the Russian government and Russian airlines. I think if the airlines had their choice, they'd return the planes. They understand that if they ever wish to fly western aircraft ever again, or fly to the west again, they'll need to work with those same western companies that they screwed. I feel sorry for the Russian airline industry. They had made such great strides. Now, it's 1972 all over again.
Leaving aside the politics, I'm curious about airworthiness certificates in general. I had assumed that, for example, any aircraft that wishes to fly / land in the US would need to have an approval from the FAA. And I'm assuming that, in normal times, the FAA accepts airworthiness certificates from a list of trusted regulators like the EU, I guess Bermuda, etc. But is there anything preventing the FAA from asserting its right to determine...
Leaving aside the politics, I'm curious about airworthiness certificates in general. I had assumed that, for example, any aircraft that wishes to fly / land in the US would need to have an approval from the FAA. And I'm assuming that, in normal times, the FAA accepts airworthiness certificates from a list of trusted regulators like the EU, I guess Bermuda, etc. But is there anything preventing the FAA from asserting its right to determine the airworthiness of any aircraft entering US airspace?
IOW, does a Bermuda airworthiness certificate really matter? Couldn't the FAA, being a US institution, refuse any Russian aircraft from its airspace, regardless of whatever other country certifies its airworthiness? Same with the EU, and any other country?
Conversely, Russia doesn't need to accept Bermuda's certificates, and their own regulator could simply certify all of their aircraft for domestic flights.
So in the end, I'm not sure why Bermuda bothered doing this. Either I'm missing something, or it really doesn't matter. I'm guessing the only reason it did this was to stay in good graces with Britain, US, EU, and other countries that already view Bermuda as an annoyance for shielding money launderers and tax evaders and symbolically sacrificing Russia is an easy way to not upset them further.
Wow this is very interesting engines that are leased etc. I guess this makes sense
In many instances the jet engines fitted to airliners are supplied under separate leases making the act of seizing an aircraft that much more diffcult. An example of this occurred when the Australian airline Ansett crashed into insolvency. Jet engines were leased to different companies so the act of repossessing an aircraft was near impossible
just know that is not Bermuda its UK sanctions that force Bermuda to do this. Bermuda needs the money to survive
Bermuda is one of the world's wealthiest countries, and became so, in part, by being a shelter for shady international business dealings. No pity for them.
And now, it's the turn of the Irish Autorities to do the same.
A lot of aircraft operated by Russian carriers wear irish registrattion.
That's become those planes are owned by Irish leasing companies. Action was taken there when the lessors had to cancel all their Russian contacts.
The impact is that the leasing companies will loose a lot of money because these aircraft will not be airworthy again even if they can be returned at some point since the replacement parts used in them will be questionable. And leasing companies will now charge more to other airlines to cover the risk of this going forward. And that means the costs will be handed down to the consumer, eventually. I wouldn’t fly a...
The impact is that the leasing companies will loose a lot of money because these aircraft will not be airworthy again even if they can be returned at some point since the replacement parts used in them will be questionable. And leasing companies will now charge more to other airlines to cover the risk of this going forward. And that means the costs will be handed down to the consumer, eventually. I wouldn’t fly a repossessed Russian aircraft and I’m sure airlines feel the same way.
What a pile of crap ! The planes are airworthy....so they lie about the safety of them. And they are confiscating yachts of wealthy people too ? No trial, no decisions by any legl entity....just decrees and siezures ? How about the Americn oligarchs that have made $$$`s at the expense of other nations....(like Ukraine) Sieze Biden`s estte in Ukraine ? Sieze Kerry`s yacht ? Klinton`s house ? Maybe just sieze the possessions of the...
What a pile of crap ! The planes are airworthy....so they lie about the safety of them. And they are confiscating yachts of wealthy people too ? No trial, no decisions by any legl entity....just decrees and siezures ? How about the Americn oligarchs that have made $$$`s at the expense of other nations....(like Ukraine) Sieze Biden`s estte in Ukraine ? Sieze Kerry`s yacht ? Klinton`s house ? Maybe just sieze the possessions of the politicians that made their money from illegal deals when they toppled countries and put their puppets in power so they could launder money and fill their pockets ?
Even Biden decreeing an economic war against Russia is illegal as far as I`m concrned. Did he consult Congress before he moved as a dictator ? No American was killes...no American border was invaded....and the US was not attacked...but we are now at war with Russia politically and economically...all be decree. Who gave him that power ? It sure isn`t in our laws or Constitution anywhere. And by coincidence its over the same nation Biden, Obama Soros & Hillary divided up and toppled the legally elected government back in 2014.... Now its been re-toppled...and Biden wants to re-re-topple it to get his money flowing again ? What a bunch of suckers to listen to his story about affairs.
Has O`Biden ever been concerned with any other nations border incursions ? He could care less about his own border. But then again....follow the O`Biden family $$$`s (and Klinton, Romney, Kerry, Pelosi (kids)...) they are using the most corrupt nation in Europe like their own private ATM....
Regulator that issued certificate of airworthiness is responsible for oversight over inspections and maintenance of aircrafts concerned. This is not currently possible in Russia, hence the revokation of certificates.
What does yachts confiscation and "American oligarchs" has anything to do with planes airworthiness?
You earned your 100 rubles today comrade. Just an FYI, Klinton is spelled with a C. Your FSB overlords will be docking your pay 1000 rubles for that. Seriously, you can't hire good trolls these days.
Rant. Citing a bunch of names you know nothing about and a bunch of cases which are inexistent or unproven. A good start: Stop reading and listening to conspiracy theories and open up a good book about WW2, the Cold War and Russian current society. Also, use your head on technical issues of airworthiness certifications and leases.
I believe @K.A. Feller must be a commie flying under a false flag. Or insane. There is no middle ground.
So if Russia does not comply with international laws they should be removed from the UN security council, because clearly they are using that seat to block any UN sanctions.
Russia would simply vetó the propose.
It doesn’t mean a whole lot now, but when this ends, and it will end, it will matter a lot, as Russia tries to re-establish connections w/ the world.
Russia could nationalize these leased aircraft on the basis of sanctions against those countries. It probably would be safer to use them for domestic operations so they can’t be seized at some foreign airport. Russia can pay in rubles for the planes that are nationalized or not pay and there is nothing that can be done. Russia can also put these planes into military service.
Some countries would be safe enough to use internationally...
Russia could nationalize these leased aircraft on the basis of sanctions against those countries. It probably would be safer to use them for domestic operations so they can’t be seized at some foreign airport. Russia can pay in rubles for the planes that are nationalized or not pay and there is nothing that can be done. Russia can also put these planes into military service.
Some countries would be safe enough to use internationally like China but I’m sure that Russia would want assurances. They can be used for Brazil and Mexico depending on the govt. in Brazil and if Mexico wants the ire of Russia which I don’t think it wants because it wants Russian tourist money and Americans won’t stop going to Cancun just because Mexico let’s in Russians.
Hopefully it applies to their fighter jets as well. If they cannot fly, then they cannot bomb Ukraine. This is a clever idea
Fighter planes are not constrained like civil aviation aircraft.
When all is said and done, no paying passengers to care for.
What about the Ukrainian bombing of Donbas for the past 8 years? Everyone in the west just ignored their pain.
Great idea, let's ban fighter jets worldwide. It's not just Ukraine that is being bombed. And most frequently, it is US manufactured planes that are being utilized.
Surely any military vehicles in combat are not insurable. I know missiles and rockets don't come with warranties.
As there all modern aircraft, probably won’t need much in way of spares, but I wouldn’t fancy flying on a plane that’s not insured.
I'm not sure, but it might be relevant for the ability of the leasing companies to seize the aircraft. Seizing an aircraft is not a simple process, in most jurisdictions it involves a judge and he/she has to take the specifically for each of the aircraft involved. If the plane flies for instance to the Middle East, the time from departure in Russia (when it becomes clear which aircraft is operating) to landing and departure...
I'm not sure, but it might be relevant for the ability of the leasing companies to seize the aircraft. Seizing an aircraft is not a simple process, in most jurisdictions it involves a judge and he/she has to take the specifically for each of the aircraft involved. If the plane flies for instance to the Middle East, the time from departure in Russia (when it becomes clear which aircraft is operating) to landing and departure back to Russia might not be enough for the court proceedings to take place.
However, if the plane is not airworthy, the civil aviation authority of the destination country might prohibit departure on that ground. This would give the leasing firms enough time, to get the plane seized.
That makes sense, but since Russia has banned all international flights and planes aren't flying out of the country does it even matter?
This is why most Russian airlines already cancelled all flights outside of Russia and Belarus. There have already been a few cases of repossessions at foreign airports.
While Bermuda isn't willing to allow its flag to be viewed as a second tier means of aircraft registration, the bigger impact of this might as a warning shot to China which is a much bigger aviation market and keeps making noise about invading Taiwan. Russia will pay a high price that will keep going on including the perception and likely reality of Russian aviation safety.
Full of crap.
Bermuda's income is from allowing other nation to register it's vessels there.
And China doesn't need to invade Taiwan.
However, it's now clear airworthiness can be used as a political weapon.
airworthiness and safety are based on decisions of the operator, not the country of registration.
These are leased aircraft and Bermuda is simply saying that it cannot properly inspect aircraft operating in Russia right now so will not allow its registration to be extended there. It isn't a political decision at all but one to ensure that Bermuda's registration is not extended to countries that do not allow international inspections.
No country needs...
airworthiness and safety are based on decisions of the operator, not the country of registration.
These are leased aircraft and Bermuda is simply saying that it cannot properly inspect aircraft operating in Russia right now so will not allow its registration to be extended there. It isn't a political decision at all but one to ensure that Bermuda's registration is not extended to countries that do not allow international inspections.
No country needs to invade another. Period.
@Tim
Full of crap again.
Airworthiness is also based on the regulator, aka country of registration.
No country needs to invade another. Period. Sorry that Native Americans tribal lands are not country. But we did sanction you with extra drugs and casinos.
Um, China has not and is not making any noise about invading Taiwan. I'd be interested in seeing these threats. What I do see over and over is USA/UK/Australia claiming China is threatening to invade Taiwan. But never from the Panda's mouth, so to speak.
Does China actually keep making noises about invading Taiwan, or is it just reported in the western press that China keeps making noises about invading Taiwan? And of course that gives the US a perfect reason to sell more weapons to Taiwan
Aviation in Russia will survive.
Russia will survive.
Yes, they can’t source parts directly from A & B. But they can still import from China, and all the other allies.
How do you think Iran Air managed to keep the 747-300s and 707s flying for so long?
Refusing to return planes to lessors is not illegal. It is violating the terms of the contract, but not violating any criminal laws. Same as selling airline miles/upgrades.
Violating the terms of a contract is illegal.
So if I take a lease on a car and refuse to pay nor return t he car, it is also not illegal?
I think not. Airline miles and upgrades are completely different as they are claimed to have "no value".
That is correct, not paying the lease on your car is not illegal. it will result in repossession, a civil, not criminal action, subject to the lease agreement you signed
How are you going to arrest Aeroflot or S7?
Russia has not refused to pay but rather the Western world has made it impossible for them to transfer payments in dollars. Furthermore, they have prohibited the planes from even entering European or American airspace. So it becomes impossible to pay and even impossible to return the planes to the lessor. It may seem to be a shady business transaction but it from the Russian's standpoint, the blame lies solely on the West. They should...
Russia has not refused to pay but rather the Western world has made it impossible for them to transfer payments in dollars. Furthermore, they have prohibited the planes from even entering European or American airspace. So it becomes impossible to pay and even impossible to return the planes to the lessor. It may seem to be a shady business transaction but it from the Russian's standpoint, the blame lies solely on the West. They should have thought about that prior to rushing ahead with sanctions and airspace restrictions.
Theft is illegal in pretty much every jurisdiction.
It's not a criminal violation, but it is a civil violation. Yes, there's a difference between criminal and civil violations, but both are breaking the law.
I hope I'm wrong but I suspect in the near future we will be seeing birds fall out of the sky (literraly) in russia.
Why?
They have enough spare parts cannibalizing the leased aircraft.
Yeah sure, that must be the reason they are looking for parts in China, among others.