Public or Private Air Transport

Public (commercial) Air Transport

Public air transport (i.e. commercial air transport or CAT) can be defined as the carriage by aircraft of passengers, cargo or mail, for remuneration or other valuable consideration, from a departure point to a point of destination. But for the odd exception (see special cases below), only a company holding an operating licence and an Air Operator Certificate (AOC), issued by the national competent authority where the company has its principal place of business, is permitted to carry passengers or goods by air in exchange for remuneration. 

In France, these authorisations, which are necessary to set up an airline, are issued by the French Civil Aviation Authority, DGAC (Direction Générale de l'Aviation Civile). 

The list of authorised French airlines includes French carriers holding an Air Operator Certificate and an operating licence. 

As for commercial balloon operators, they are no longer required to hold an AOC but are subject to a declaratory system.

Special Cases 

Certain air services provided by unpowered aircraft and certain local flights are exempt from the requirement to obtain an AOC and an operating licence, under the conditions stipulated in Article R. 6412-4 of the French Transport Code. 

Cost-shared flights are exempted from the operational requirements applicable to commercial air transport , on the condition that they are carried by private individuals, using other-than-complex motor-powered aircraft subject to European Union rules adopted in application of Regulation (EU) 2018/1139 (non-complex aeroplane, non-complex helicopter, balloon, sailplane), and that the direct cost is shared by all the occupants of the aircraft, pilot included. The number of persons sharing the direct costs is limited to six in the case of an aeroplane or helicopter flight, and limited to four in the case of a balloon flight.
 

Non-commercial (Private) Air Transport 

Unlike public air transport, private air transport is organised by a public or private person for their own private use. In this case, flights cannot be offered for sale. The transport service must be provided free of charge, or based on the cost-shared model (see special cases above). No prior authorisation is required for private air transport. Safety requirements and their oversight are lessened compared to public air transport.

Operation of aircraft under shared or fractional ownership: Commercial or Non-commercial transport?

Définitions

The operation of an aircraft under shared ownership is regarded as being the operation of an aircraft by each co-owner, on the understanding that the fixed costs (maintenance, personnel, insurance, manager's operating costs) are divided between the co-owners in proportion to their right(s) in the aircraft. This arrangement does not exclude the signing of a contract between these co-owning entities and a third party that will manage the aircraft on behalf of the co-owners.

As for fractional ownership (based on the American concept of “fractional ownership operations”, which are subject to specific regulations in the United States), in addition to the agency contract between each co-owner and a third party entrusted with managing their aircraft on their behalf, it implies the conclusion of a shared ownership contract between co-owners of separate co-ownerships, enabling each co-owner to have a right of use covering all the aircraft.

⚠ These two modes of operation imply that all co-owners are liable in the event of damage to the aircraft, passengers or third parties. They also imply a lower level of passenger protection than that required in the context of commercial air transport, in terms of both flight safety and the compensation scheme in the event of an incident or accident.

Distinctions between private or non-commercial and public or commercial air transport

While these operating practices may appear similar to private or non-commercial air transport, within the meaning of Regulation (EU) No 965/2012, several non-cumulative criteria are nevertheless likely to provide a number of indications leading to the conclusion that a flight to, from or within French territory, operated under shared or fractional ownership, is in reality a case of air transport for remuneration or valuable consideration (public or commercial air transport), requiring compliance with the relevant regulations. This would make it a case of illegal public transport. The indications of such a situation are as follows:

1. The fact that one or more passengers on the flight are neither joint owners nor guests of joint owners is one indication of a public transport operation. The same applies to the invoicing of flights to persons other than the co-owners themselves. The assessment is made on a flight-by-flight basis.
2. Examination of the contractual relationships between the co-owners or between the co-owners and the entity managing the aircraft reveals that the co-owners’ objective goes beyond the organisation of transport services for themselves or their guests and the joint management of their aircraft, and thus reveals a commercial relationship other than that necessary for the joint management of their aircraft. This is an indication of public transport.
    

Here are some examples:

• Low level of financial commitment by co-owners: no ownership or ownership of a symbolic share in the aircraft, short term of commitment by co-owners, no minimum period between this commitment and the first use of the aircraft. For information, US regulations (Part 91K) set the minimum share in aircraft that may be held in fractional ownership transactions at 1/16th.
• Absence of control or only token control by the co-owners over the management entity.
• Lack of definition of the aircraft usage rights per co-owner (duration and conditions of use of the aircraft not being in proportion to the acquired share).
• Lack of designation of third parties who may benefit from flights on board aircraft operated by co-owners (managers and employees duly designated beforehand if the co-owner is a legal entity, guests). Another indication is enabling an excessive number of natural persons to benefit from the flights.
   

3. The organisation and functioning of the entity managing the aircraft, when it does not hold an AOC, reveal the practice of a commercial air transport activity. 

For example:

• The remuneration of the managing body for the flight significantly exceeds the direct costs associated with the flight (such as fuel, landing fees and maintenance) to the point at which it is similar to the sale of a transport ticket.
• The managing entity uses advertising not only to promote co-ownership or fractional ownership, but also to highlight access to air services. The existence of an Internet platform for booking flights accessible to people who do not hold a right of use, for the development of their shared or fractional ownership activities, is another indication of public transport.
   

Operational recommendation

In both of these operating modes (shared and fractional ownership), the agency contract concluded with the manager should:

• designate the administrative and technical support services provided by the management entity on behalf of the co-owner. It may include, without being limited to, operations, servicing, flight planning, crewing (provision, training), and ensuring the continuing airworthiness of the aircraft;
• clearly identify the entity or entities assuming the responsibilities of the air operator and the continuing airworthiness manager. In principle, operational responsibility is borne jointly by the co-owners and the co-ownership manager.

Illegal Commercial (Public) Transport 

Illegal public transport refers to air transport carried out in return for valuable consideration, by a service provider that does not hold the necessary authorisations, i.e.  Air Operator Certificate (AOC) and an operating licence. 

Therefore, when a person purchases an air transport service (aircraft and pilot) from an unauthorised carrier (i.e. not holding a licence and AOC), this is illegal public transport, whether the carrier is a company or just a pilot. 

Important! When a public flight is provided by an unauthorised carrier:

• safety standards are not guaranteed; passengers will likely not be covered in the event of an accident. In fact, insurance contracts contain a general clause excluding coverage of an accident involving an ‘illegal carrier’
• carriers operating illegal flights can face criminal prosecution and administrative proceedings (Cour de Cassation, Criminal Division, 19 February 1997, no. 95-81352)
• pilot qualification and training may be substandard, and their working hours are not regulated. 

Administrative Sanctions for Unauthorised Commercial (Public) Air Transport 

Point 1 of Article R. 6432-2 of the French Transport Code authorises the Minister in charge of Civil Aviation, after seeking opinion from the Commission administrative de l’aviation civile (an administrative committee for civil aviation), to fine any natural or legal person who “carries out public air transport without a valid air carrier operating licence where such licence is required under Articles L. 6412-2 and L. 6412-6 of the Transport Code”.

These administrative fines can be up to €1,500 for natural persons and €7,500 for a legal person, per breach, i.e. per flight. The amount can be doubled in the event of a repeat offence.

The French Civil Aviation Code adds that, once final, the sanction decision taken by the Minister in charge of Civil Aviation is published on the Ministry’s website, in whole or in part, for the time stipulated in that Code.
 

Commission administrative de l’aviation civile (CAAC)

In accordance with Articles R. 6231-7 to R. 6231-11, R. 6231-15 to R. 6231-17, R. 6231-25 and R. 6231-27 to R. 6231-28 of the Transport Code, the Minister in charge of Civil Aviation seeks the opinion of a collegial advisory committee, the Commission administrative de l’aviation civile, before taking the decision to fine an offender.

This committee has a specialised ‘Air Transport’ section made up of Government representatives and professionals from the air transport sector or their trade associations, including helicopter and general aviation operators.

Following an inquiry procedure which includes obtaining an official report on the violation prepared by sworn officers, the committee reviews the cases and interviews the natural or legal persons involved before issuing an opinion to the Minister.

After receiving this non-binding opinion, the Minister makes the decision which is then notified to the offender.

A proceeding in the administrative courts is available against the Minister’s decisions.

The sanction decision is published on the Ministry’s website for two years after becoming final.
 

Sanctions Decisions