CASA EX73/23 — Registration of Exempt Aircraft (Operators, Prospective Owners and Initial Owners) Instrument 2023

Exempt aircraft is defined in section 3 as a new turbine‑engine aeroplane to which Part 121 (other than Subpart 121.Z) of CASR applies, and that its manufacturer will operate for production flight testing, customer demonstration flights and other pre‑delivery activities. Part 121 applies to multi‑engine aeroplanes operated for an Australian air transport operation if the aircraft has a maximum operational passenger seat configuration of more than 9, or a maximum take‑off weight of more than 8,618 kg. In practice this covers large commercial jets such as the Airbus A320 family, Boeing 737, and Embraer E‑jets. The aircraft must be new, not second‑hand, and must be operated by the manufacturer for pre‑delivery purposes. The instrument notes that at the time of making, the most common manufacturers are Airbus (France), Boeing (USA) and Embraer (Brazil). The definition distinguishes between manufacturers located in the European Union and others, because the applicable operational rules differ.

Prospective owner means a person who has purchased an exempt aircraft from its manufacturer but to whom ownership has not yet been transferred. This person is not the legal owner but has a contractual right to become owner upon delivery. The instrument allows such a person to step into the shoes of an owner for the limited purpose of applying for registration.

Initial owner means a person who has purchased an exempt aircraft from its manufacturer and to whom the manufacturer has transferred ownership. This is the purchaser after delivery.

Operator means the operator of an exempt aircraft. The operator will typically be the manufacturer while it flies the aircraft for testing and demonstration before delivery. The operator may be the same person as the prospective owner or the initial owner, or a different person. For example, if the manufacturer operates a demonstration flight for a potential buyer who is not yet the owner, the manufacturer is the operator.

Intervening period is the period from when the aircraft is registered in reliance on the section 4 exemption until immediately before the manufacturer transfers ownership to the initial owner. During this period the aircraft is on the Australian register but is still owned and operated by the manufacturer.

Exemptions: The instrument creates three tiers. For an unregistered exempt aircraft, the prospective owner is exempt from certain registration provisions (section 4). For an exempt aircraft that has already been registered under that exemption, the prospective owner is exempt from all CAR and CASR except Part 11 (section 5). The operator is also exempt from all CAR and CASR except Part 11 and the two maintenance‑program approval regulations (section 6). These exemptions are conditional. The operator’s exemption ceases upon transfer of ownership to the initial owner, because then the aircraft enters normal Australian operational regulation.

The instrument directly affects three categories of actors. Prospective owners , typically Australian airlines, aircraft leasing companies, or other commercial operators that have ordered new turbine‑engine aeroplanes from manufacturers such as Airbus, Boeing or Embraer. They are the ones who can apply for registration before delivery. Without the instrument, they would have to wait until they take legal ownership, then apply for registration, which could cause operational delays. The instrument reduces that administrative lag.

Operators , during the intervening period the operator is the manufacturer, not the Australian purchaser. The instrument exempts the manufacturer from most Australian aviation safety regulations while it flies the aircraft for pre‑delivery activities. This means the manufacturer can conduct production flight tests and customer demonstration flights under its own foreign regulatory regime, without having to comply with CAR and CASR beyond Part 11 and maintenance program approval. The manufacturer must however follow its own production approval certificate (issued by its national aviation authority) and, depending on where the flights occur, the applicable foreign legislation (EU Commission Regulation 748/2012 or US FAR Part 21). The instrument does not require the manufacturer to hold an Australian air operator’s certificate, but the operator must still comply with Part 11 of CASR (which essentially governs applications to CASA for exemptions and approvals) and, if it wants a maintenance program approved, must apply under regulations 42.970 and 42.975.

Initial owners , once the manufacturer transfers ownership, the person who becomes the owner must provide CASA with the bill of sale and a written notice of transfer within 24 hours. That owner then becomes subject to the full suite of Australian aviation regulations (the exemptions in section 6 cease at transfer). The instrument thus imposes a tight reporting obligation on the initial owner.

Other affected parties include CASA, which must process registration applications from prospective owners who are not yet owners, and which receives notices and bills of sale. Foreign aviation authorities issue the certificate that the aircraft is not registered and the manufacturer’s production approval certificate. Foreign pilots who fly the aircraft during pre‑delivery activities may need to complete an aviation security status check if they intend to fly after registration, as noted in a note to section 8. The instrument also affects prospective owners who change their minds , if they decide not to apply for registration, or if ownership is to be transferred to someone else during the intervening period, they must notify CASA within 24 hours. The instrument does not directly affect owners of aircraft that do not meet the “exempt aircraft” definition, such as smaller turbine aeroplanes or piston‑engine aircraft. The sunset date of 30 June 2026 means the instrument is temporary, so long‑term planning for aircraft deliveries after that date cannot rely on it.

The instrument creates rights to exemptions and imposes corresponding duties. Rights: a prospective owner has the right to apply for registration of an unregistered exempt aircraft as if it were the owner, and to omit owner‑related information from the application (section 4). Once the aircraft is registered under that exemption, the prospective owner is exempt from all CAR and CASR except Part 11 (section 5). This means the prospective owner does not need to comply with operational regulations, maintenance regulations, etc., while the aircraft is still with the manufacturer , a useful right since the prospective owner has no control over the aircraft during that period. The operator (usually the manufacturer) is also exempt from CAR and CASR except Part 11 and the two maintenance‑program regulations (section 6). This allows the manufacturer to operate under its own foreign rules.

Duties: these are detailed in sections 7, 8 and 9. For a prospective owner seeking to rely on the section 4 exemption, section 7 imposes conditions that must be met before or contemporaneously with the application. The prospective owner must include in the application a letter from the manufacturer confirming the manufacturer’s agreement to the aircraft being registered before transfer of ownership. The prospective owner must also include a certificate from the national aviation authority of the country where the aircraft was manufactured, stating that the aircraft is not registered (i.e., it is not already registered elsewhere). These conditions ensure that the aircraft is genuinely new and that the manufacturer consents to the early registration.

Additionally, the prospective owner has two notification duties. If at any time the prospective owner becomes aware that they will not apply for registration in reliance on the exemption for any reason, they must notify CASA in writing within 24 hours (section 7(2)). Similarly, if the prospective owner becomes aware that ownership of the aircraft will be transferred to someone other than the prospective owner during the intervening period (i.e., the aircraft will be sold to a different buyer), they must notify CASA within 24 hours (section 7(4)). These duties are time‑critical and carry practical risk if missed.

For operators, section 8 imposes a single but significant condition: the operator must ensure the exempt aircraft is operated by its manufacturer in accordance with the manufacturer’s production approval certificate (as it exists from time to time) and for the specified pre‑delivery activities. The operator must also ensure that if the activities are carried out in a foreign country in the European Union, they are in accordance with the related legislation of that country; otherwise, in accordance with the related legislation of the foreign country where the aircraft was manufactured. The instrument gives examples: EU Commission Regulation 748/2012 and US FAR Part 21. The operator’s duty is ongoing and requires monitoring of changes to foreign legislation and to the manufacturer’s production approval certificate.

For initial owners, section 9 directs them to provide CASA with a copy of the bill of sale and written notice confirming the transfer, including the time and date of transfer, within 24 hours after the manufacturer transfers ownership. This duty ensures CASA’s register is updated promptly and that the aircraft transitions from the exemption regime to normal regulation.

Finally, the instrument includes an automatic lapsing provision: if ownership is not transferred to an initial owner before the repeal of the instrument (30 June 2026), the registration of the aircraft is taken to have lapsed (section 7(3)). That imposes a time limit on the entire arrangement.

The instrument itself does not create new penalty provisions. However, breaches of the conditions or a failure to comply with the direction can have significant consequences under the broader regulatory framework. The exemptions in sections 4, 5 and 6 are conditional. If a condition is not met or is breached, the exemption likely ceases to apply, meaning the prospective owner or operator would be in breach of the underlying CAR or CASR provisions from which they were exempt. For example, if a prospective owner applies for registration without including the manufacturer’s letter and the foreign certificate, CASA could refuse the application or, if already registered, treat the registration as invalid. Operating an aircraft without valid registration is an offence under the Civil Aviation Act 1988 and CASR. Similarly, if an operator operates an exempt aircraft outside the conditions in section 8, the exemption is lost and the operator would be subject to the full force of CAR and CASR, including possible enforcement action by CASA.

The notification duties under sections 7(2), 7(4) and 9 are explicit obligations. Failure to notify CASA within 24 hours of a relevant event could constitute a breach of a condition of the exemption (for the prospective owner) or a failure to comply with a direction under regulation 11.245 of CASR (for the initial owner). Under regulation 11.250 of CASR, a direction made under 11.245 is enforceable; non‑compliance may lead to civil penalty proceedings or suspension of authorisations. The instrument’s note at section 2(b) specifically references regulation 11.250, indicating that the direction in section 9 ceases to be in force at the end of 30 June 2026, but until then it is binding.

The practical enforcement lever is that CASA can revoke or refuse the registration of an exempt aircraft if conditions are not met. There is no mention of monetary penalties within the instrument, but the underlying Acts and regulations provide for penalties up to considerable sums (for example, operating an unregistered aircraft can attract penalties under the Civil Aviation Act). For operators, the condition in section 8 requires compliance with foreign legislation; a breach of that foreign law might not directly attract Australian penalties, but it could lead to loss of the exemption and then to Australian enforcement for operating without compliance with CAR/CASR.

The instrument thus relies on the self‑executing nature of conditional exemptions: the exemption is a privilege that can be lost, and the consequences of loss are serious. The 24‑hour notification duties create a tight compliance window; a missed notification could result in the exemption being voided, exposing the prospective owner or operator to liability. For initial owners, the direction under section 9 is backed by the general enforcement powers of CASA under Part 11 of CASR and the Civil Aviation Act.

The instrument operates within a dense web of Australian and foreign aviation law. It is made under regulations 11.160, 11.205 and 11.245 of CASR. Regulation 11.160 allows CASA to make instruments granting exemptions from CASR provisions; regulation 11.205 allows conditional exemptions; regulation 11.245 allows CASA to issue directions. The instrument interacts with Part 47 of CASR (Registration of Australian civil aircraft), Part 121 (Large aeroplane air transport operations), and Part 42 (Continuing airworthiness). It specifically exempts certain persons from subregulations 47.060 and 47.080, and from the CAR and CASR generally, but it carves out Part 11 of CASR. This means that the exemption from registration does not relieve the prospective owner or operator from complying with Part 11, which covers CASA’s rule‑making powers, applications for exemptions, and directions. So if a person wanted to seek a further exemption from some other provision, they would still need to use Part 11 processes. Also, the instrument does not exempt anyone from the Civil Aviation Act itself; it only exempts from the regulations. The Act continues to apply, including offences for unsafe operation, but those are not registration‑specific.

For maintenance, the operator exemption in section 6 explicitly keeps regulations 42.970 and 42.975 (maintenance program approval) and 42.1045 (reliability program approval) applicable. This means that even during the pre‑delivery period, if the operator wants CASA‑approved maintenance or reliability programs, they must apply under those regulations. The operator may choose to rely on foreign approvals instead, but if they want Australian‑specific approvals, the full CASR procedure applies.

The instrument also interacts with foreign legislation. For operators, section 8 conditions require operation in accordance with the manufacturer’s production approval certificate issued by the foreign national aviation authority (e.g., EASA for Airbus, FAA for Boeing, ANAC for Embraer). The operator must also follow the related legislation of the country where the pre‑delivery activities are carried out (EU law for EU manufacturers, US law for US manufacturers, etc.). This means the operator effectively has a choice: comply with foreign law during the pre‑delivery period, as long as the conditions are met, or lose the exemption. The instrument does not require the operator to hold an Australian AOC while flying the aircraft for testing and demonstration.

The notes to section 8 also refer to the Aviation Transport Security Regulations 2005, specifically subregulation 6.54(2) and regulations 6.56, 6.56A and 6.57, which relate to aviation security status checks for foreign pilots. If a foreign pilot is to fly the exempt aircraft after registration, they must complete a security check as part of applying for a certificate of validation under the Civil Aviation Act and CASR. This is not a condition of the instrument itself, but a reminder of a separate legal requirement.

If the aircraft is never delivered to an Australian initial owner, section 7(3) provides that the registration lapses upon repeal of the instrument. That interacts with Part 47 of CASR which would otherwise govern cancellation of registration. This provision is a unique statutory override. Finally, the instrument does not affect any contractual obligations between the prospective owner and the manufacturer, nor does it affect the manufacturer’s liability under foreign law. It is purely a regulatory exemption.

The instrument, CASA EX73/23, was made by Pip Spence, Director of Aviation Safety, on 28 July 2023, and registered on the Federal Register of Legislation presumably on that date or shortly thereafter. It commenced on the day after registration. There is no indication in the source text that the instrument has been amended since its making. The instrument is self‑repealing: it will be repealed at the end of 30 June 2026, as stated in section 2(b). The note to section 2 clarifies that the direction in section 9 ceases to be in force at the same date, consistent with regulation 11.250 of CASR. The instrument does not have a specific amendment mechanism; as a legislative instrument, it could be amended by a subsequent instrument under the same enabling provisions. However, as of the source text (which is the instrument itself), no amendments are recorded. The sunset provision is significant: any pre‑delivery arrangement that extends beyond 30 June 2026 cannot rely on this exemption. If CASA wishes to continue the regime, it would need to make a new instrument before that date, potentially with modifications. The instrument’s short life (under three years) suggests it was intended as a temporary solution while CASA considers permanent arrangements or while the industry adjusts to new registration processes.

The instrument is too recent and narrow for any reported litigation to exist. The source text does not mention any court cases. However, potential areas of legal dispute can be anticipated. A prospective owner could challenge CASA’s refusal to accept an application if the conditions in section 7 are not met, but the instrument gives CASA discretion to accept or reject (the exemption is conditional, not automatic). An operator could argue that CASA wrongly imposed conditions beyond the instrument (e.g., requiring an Australian AOC for pre‑delivery flights) but the instrument is clear that the operator exemption excludes Part 11 and the maintenance regulations; it does not require an AOC. A dispute could arise over the meaning of “related legislation” in section 8(b) , whether a particular foreign rule falls within that phrase. The notes give examples but are not exhaustive. Also, the 24‑hour notification duties could lead to disputes over what constitutes “becoming aware” and whether the prospective owner had constructive knowledge. The lapsing provision in section 7(3) could be contested if the aircraft is delivered just before repeal but registration lapses due to timing. In general, the instrument has a low litigation risk due to its limited scope and temporary nature, but any enforcement action by CASA for breach of conditions could be challenged in the Administrative Appeals Tribunal or Federal Court. As of now, no such cases are known.

Several features of the instrument could catch out unwary prospective owners, operators, or initial owners. Tight notification windows: the duties to notify CASA within 24 hours of deciding not to apply, or of a change in intended transferee, or after transfer of ownership (section 9), are extremely short. A missed email or a public holiday could result in non‑compliance. The clock starts when the person becomes aware, which may be instantaneous upon receipt of an email or phone call. There is no grace period. Registration lapses if no transfer before repeal: if the aircraft is not delivered to an initial owner before 30 June 2026, the registration is taken to have lapsed (section 7(3)). That means a prospective owner who registered an aircraft in, say, 2024, but whose delivery is delayed, could find the aircraft unregistered at the end of June 2026, requiring a fresh application under normal rules. The prospective owner cannot rely on the exemption to maintain registration beyond that date.

Conditional exemption for operators: the operator exemption under section 6 is subject to the condition in section 8. The operator must ensure the aircraft is operated by the manufacturer in accordance with the manufacturer’s production approval certificate and the relevant foreign legislation. If the manufacturer changes its production approval (e.g., a new certificate with different conditions) or if the foreign legislation is amended, the operator must immediately comply with the new requirements. The operator is responsible for monitoring those changes. The notes list the manufacturer’s certificates for Airbus, Boeing and Embraer, but note that Boeing’s and Embraer’s certificates are not freely available. The operator may need to obtain them from the manufacturer. Foreign pilots and security checks: the note under section 8 draws attention to the need for foreign pilots to complete an aviation security status check before flying the exempt aircraft after registration. This is not a condition of the instrument, but it is a separate legal requirement. Failure to do so could prevent the pilot from obtaining a certificate of validation, grounding the aircraft. Applicability only to new aircraft: the definition of exempt aircraft requires it to be a new turbine‑engine aeroplane. Second‑hand aircraft, even if large and turbine‑powered, do not qualify. Also, the aircraft must be operated by the manufacturer for pre‑delivery activities; if the manufacturer operates it for other purposes (e.g., charter), the exemption does not apply. No exemption from the Civil Aviation Act: the instrument only exempts from the regulations, not from the Act. So any provisions of the Act that apply to registration or operation of aircraft (e.g., section 20AA requiring registration before operation in Australian territory) continue to apply. The instrument may effectively satisfy such requirements by allowing registration, but the Act itself is not modified. The intervening period: during this period, the aircraft is registered in Australia but is operated by the manufacturer under foreign rules. The manufacturer may not have Australian insurance or meet Australian pilot licensing requirements. The instrument does not address liability or insurance; that remains a contractual matter between the prospective owner and the manufacturer.

Compliance with CASA EX73/23 requires careful attention to timing and documentation. For a prospective owner who has ordered a new large turbine aeroplane and wants it registered in Australia before delivery, the steps are: first, obtain a letter from the manufacturer confirming the manufacturer’s agreement to the aircraft being registered on the Australian Civil Aircraft Register before transfer of ownership. The letter should be explicit and preferably dated. Second, obtain a certificate from the national aviation authority of the country where the aircraft was manufactured (e.g., EASA for Airbus, FAA for Boeing, ANAC for Embraer) stating that the aircraft is not already registered in that country. This certifies the aircraft is new and unregistered. Third, prepare an application for registration under regulation 47.060 of CASR, but in the application, treat the prospective owner as the applicant and include the prospective owner’s details, not the owner’s details. The application must include the manufacturer’s letter and the foreign certificate. Fourth, if at any point the prospective owner decides not to proceed with the application (for any reason), notify CASA in writing within 24 hours of that decision. Similarly, if the prospective owner learns that ownership will be transferred to a person other than the prospective owner during the intervening period (e.g., the manufacturer sells the aircraft to a different buyer), notify CASA within 24 hours.

For the operator (typically the manufacturer) during the intervening period: ensure that the exempt aircraft is operated by its manufacturer (i.e., the manufacturer itself, not a third party) in accordance with the manufacturer’s current production approval certificate. The operator must verify that the certificate is valid and that operations are conducted within its scope. The operator must also ensure that pre‑delivery activities are carried out in compliance with the relevant foreign legislation. If the activities occur within the European Union, the operator must follow the applicable EU regulations (e.g., Commission Regulation 748/2012). If they occur in the United States (e.g., Boeing), follow US FAR Part 21. For other countries (e.g., Brazil), follow that country’s legislation. The operator must also ensure that if it wishes to use a CASA‑approved maintenance program or reliability program, it applies under regulations 42.970/42.975 or 42.1045 as appropriate. Note that the operator does not need to comply with other CAR and CASR provisions, but must still comply with Part 11 of CASR (e.g., if making an application for an approval). If foreign pilots will fly the aircraft after registration, the operator (or the prospective owner) should ensure those pilots have completed an aviation security status check and obtained a certificate of validation under the relevant provisions of the Civil Aviation Act and CASR.

For the initial owner (the person to whom the manufacturer transfers ownership): as soon as the manufacturer transfers ownership, the initial owner must provide CASA with two things within 24 hours: a copy of the bill of sale issued by the manufacturer, and a written notice confirming the transfer, including the time and date of transfer. The notice should be clear and preferably signed. After that, the initial owner becomes subject to all normal Australian aviation regulations (the exemptions cease). The initial owner should ensure that the aircraft’s registration is valid and that the aircraft is operated under an appropriate AOC and maintenance control system.

All parties should keep records of all communications with CASA and the manufacturer, including acknowledgments of notifications. Given the 24‑hour deadlines, it is prudent to have pre‑prepared communication templates and to designate a person to monitor for triggers. The sunset date of 30 June 2026 means that any arrangement expecting delivery after that date cannot rely on this instrument; alternative registration arrangements must be made.