The New UK: What Does Brexit mean for Aviation?

Part One: Brexit’s Legal Landscape Affecting Aviation

Everyone knows that the UK left the EU earlier this year, and that the UK and EU have been in the Withdrawal transition period since January 31. The Withdrawal period is governed by the Withdrawal Agreement signed by the UK and the EU last year. The last day of the current transition period is scheduled to be December 31, 2020. Part of the rationale behind the nearly-one-year-long transition period was to permit the UK and EU to negotiate a trade agreement that would reflect their long-term relationship.

There is little time for the UK and EU to complete negotiations. The negotiation were already very difficult due to the differing opinion on political issues like the Irish border; those negotiations have been hampered as each deals with the issues surrounding Covid-19. Trade deal negotiations restarted this past weekend, but it may be too little, too late. It is looking like there may not be an agreement by December 31 – most particularly not an agreement that permits the UK CAA to remain as a part of EASA.

So what does this mean for the aircraft parts market? First let’s examine some of the general agreements and basic principals that are likely to affect aircraft parts transactions (in the next article, we will examine some more specific scenarios and rules).

Generally speaking, a nation remains responsible for the airworthiness of the aircraft on its national registry. This means that an aircraft on the German registry can be maintained under the EU (EASA) regulations, and the rules about what parts can be installed on that aircraft are gong to be the EU rules. The EU has entered into agreements with other authorities to share certain oversight duties; for example, new parts produced under US FAA certificates/approvals are typically legal to install on EU aircraft when they meet the terms of the agreements between the EU and the US. But the EU does not have a comparable agreement with Mexico, so an aircraft parts produced under production approval issued by the Mexican DGAC would not be directly accepted into the EU system (note that EASA has a working arrangement that permits Mexico to validate and/or accept certain EASA certificates and approvals).

Through the EU (Withdrawal) Act 2018, all European Union aviation laws were adopted into UK law upon Brexit (deferred to the end of the transition period).  This means that the same EASA regulations under which the UK has been operating will continue to apply to UK transactions, but new EU regulations will no longer apply directly to the UK after the end of the transition period.

Because the UK is withdrawing completely from the EASA system as of January 1, 2021, the UK CAA will undertake all of the aviation safety regulatory functions. UK CAA has been preparing for this for years, and they appear to be ready.

The UK will no longer be included in EU-level Bilateral Aviation Safety Agreements. New UK agreements have already been negotiated and will come into effect on January 1, 2021. These agreements will be substantially the same as the correlative agreements between the ‘third-country’ and the EU. These include agreements with the following ‘third countries:’

• Canada (Working Arrangement, Technical Implementation Procedures, Technical Arrangement on Maintenance)
• Japan (working arrangement only)
• United States (Implementation Procedures for Airworthiness, Maintenance Implementation Procedures, Maintenance Agreement Guidance)

Until and unless something changes in the EU law or in the negotiations between UK and EU, there appears to be no agreement between the EU and the UK for aviation approvals and certificates.

The EU promulgated a regulation (Regulation (EU) 2019/494 (25 March 2019)) that permitted recognition of certain documents, like copies of Form 1, during a continuing transition period; however that recognition did not come into effect because Article 10(3) explains that the regulation will not come into effect if a withdrawal agreement is signed before Brexit. Such a Withdrawal Agreement entered into force in 2019. This means that the primary EU legal authority permitting acceptance of approvals issued in the UK before January 1, 2021 did not come into effect. This does not mean that the EU cannot accept any new or maintained aircraft parts from the UK – there is an important exception that may apply from Article 41 of the Withdrawal Agreement – and we will address this important exception in our next blog article.

In the next blog post, we will look more specifically about how all of this affects aircraft parts transactions.

#aviation #brexit