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11 March 2009
It is often taken for granted that at any given time the ownership and lien status of a registered aircraft can be determined. However, a problem that has plagued Brazil for several years is the time required to obtain a certidão. A certidão is a printed extract from the records of the Brazilian Aeronautical Registry (RAB). For the past few years the time required to obtain certidões has been approximately two months and in some cases even longer. The RAB did not consider them priority documents. However, the National Civil Aviation Agency (ANAC), to which the RAB is subordinated, has recently greatly improved the issuance system.
A certidão is a printed document from the ANAC which indicates:
No other official document contains all this information. Since the RAB is an owner register, the certidão takes on a special relevance.
A certidão is not needed for purposes of operating an aircraft. To operate aircraft registered with the RAB the operator must have a certificate of airworthiness and a certificate of registration, both of which differ from a certidão. The certificate of airworthiness demonstrates technical approval of an aircraft. The certificate of registration includes the names of the owner and operator of an aircraft, but does not describe liens in any detail. Therefore, it is in the interest of any lessor or mortgagee or other financier to obtain a certidão to ensure that its interests have been properly recorded in the RAB's records.
For parties intending to purchase or refinance aircraft registered with the RAB, the delay of two months to issue firm opinions as to the absence of liens frequently causes problems with timing for closings. As a result, many closings have been delayed, postponed or even cancelled. Parties rarely consult their local counsel two to three months in advance. Moreover, most financiers expect opinions dated on the closing date. Therefore, the inability of counsel to obtain a certidão on a particular closing date can make such opinions difficult or impossible to render.
Since late 2008 ANAC has made it possible for counsel to obtain certidões online. This greatly facilitates scheduling closings of aircraft purchases and refinancing transactions, since in most cases local counsel can verify the registration status of an aircraft prior to a closing and again on the scheduled closing date. Electronic certidões can be authenticated through ANAC's website.
Electronic certidões do not resolve all registration problems with the RAB. On average there is still a two-month delay between the time that a document is filed and the time that the RAB recognizes the registration of the document in its records. This means that Brazilian deals will continue to have long post-closing tail periods and final opinions on transactions will still not be available until one to three months after the closing date. However, parties can now proceed with closings with considerably more confidence that the aircraft they are purchasing or financing is free of liens. This was simply impossible as little as a few months ago. While ANAC may have been criticized for its shortcomings in the past, it has now offered a considerable improvement to the quality of services provided by the RAB.
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