Short & sweet no. 2
Flying commercially within the EU

• Can Temporary Admission be used to fly commercially? (YES!)
• What is the real difference between Temporary Admission and full importation in this context?
• Which limitations disappeared in 2016?

This is the second article in a new OPMAS series called Short & Sweet, intended to offer a quick insight into various topics about flying within the EU.

This Flying commercially within the EU issue describes scenarios where an aircraft brought into EU by a non-EU operator that uses the aircraft commercially for charter (such as part 135).

Introduction
Any aircraft flying into the EU will fly under EU customs control using either the Temporary Admission (TA) regulation or full importation (FI). There are no other options. The TA can only be used by entities and aircraft owned, operated, registered, and based outside the customs territory of the Union while anyone can use the FI. However, both can be used commercially or privately if applied correctly.

It is often tricky for laypeople to see the differences between the two entry options, but the flexibility and long-term consequences are very different, and there are certain conditions, which must be taken into consideration when opting for TA or FI. Non-compliance with either the TA or FI regulations will most likely activate a direct payment of the VAT (ranging 17-27%) and customs duty (2.7-7.7%). Please, see the below-mentioned TA and FI scenarios A-C.

A: Flying charters under Temporary Admission

EU Customs Code restrictions: The aircraft can be used for any purpose *)
Traffic restrictions: Proper traffic rights must always be obtained from the competent authority where needed.
Internal EU trips with EU resident passengers: Yes, this is allowed.
Period of stay: Up to six months of flying within the EU.
EU base: Not possible.

Flying charter under TA is, regardless of the commercial aspect, considered to be private use in the EU Customs Code and grants extra privileges for how the aircraft can be used and the period of stay.

*) When the aircraft is used against a ticket fee it will be considered commercial use, please see scenario C.

B: Flying charters under full importation

EU Customs Code restrictions: The aircraft can be used for passenger transportation without customs restrictions.
Traffic restrictions: Proper traffic rights must always be obtained from the competent authority where needed.
Internal EU trips with EU resident passengers: Yes, this is allowed.
Period of stay: Unlimited.
EU base: Yes, this is allowed.

C: Flying charters under Temporary Admission selling tickets or similar (like airlines)

EU Customs Code restrictions: The aircraft can only be used for passenger transportation with a ticket-like payment.
Traffic restrictions: Proper traffic rights must always be obtained from the competent authority.
Internal EU trips with EU resident passengers: Yes, this is allowed.
Period of stay: As long as the charter takes yet limited to maximum 24 months. Here, the aircraft must leave the EU as soon as the charter ends if the aircraft is in an EU airport.
EU base: Not possible.

Flying charters under TA selling tickets or similar is considered commercial use in the EU Customs Code and grants limited privileges for how the aircraft can be used and the period of stay. Such a commercial flight cannot start as a Part 135 or 121 and continue as a private flight when inside the EU. Flying charters under TA selling tickets or similar is also the procedure used by all foreign airlines flying to EU destinations, but it is, of course, difficult for non-EU airlines to get traffic rights for internal EU trips which is often the real limitation in this category.

Consequently, an operator that sells tickets will be placed in this category C. This is not a catastrophe as any non-EU operator will normally fly back home immediately after the charter ends. It is not an option to take an extra rest or wait for a new charter within the EU before flying back home. A ticket-like payment or a group charter fee split between and invoiced to each person on-board the aircraft will give the same result.

The below-mentioned limitations have not been a part of the EU Customs Code since 2016
We have often been met with the argument that the restrictions below are why charters within the EU are not possible under TA. However, this argument is not valid as these restrictions have not been included in the EU Customs Code the last five years and are still not included in the EU Customs Code.

1. Internal traffic is not mentioned as a customs restriction anymore in relation to the use of TA. It is, of course, still the responsibility of the operator to secure traffic rights, but a violation can no longer create a customs debt.

2. Commercial use traffic in relation to the use of TA (scenario C) is no longer limited to flights which begins or ends outside the customs territory of the Union but solely limited by the terms for the period of stay mentioned in scenario C.

Legal background – learn more
The description is based on the EU Customs Code (UCC) and various EU working papers and directives. Especially the 2014 working paper from the EU Customs Code Committee (available in English, French and German) is important. The usage of TA includes a few limitations which must be handled correctly and situations which must be avoided. Please learn more on opmas.dk or contact us.

Traffic rights
Non-EU based operators will have to apply for traffic rights on internal EU flights in some EU member states, pending on the type of flight performed. Aviation traffic rights (freedom rights) will still be needed even though the aircraft is already correctly customs handled with the use of the Temporary Admission procedure or a full importation. Always ask locally if you have any doubts.

How can we help?
If you have questions about the above, please do not hesitate to contact us. We offer a cost-free introduction and analysis of the owner/user/operator scenario to find the best option when flying within the EU. Please, feel free to contact us anytime.

Selected links covering this issue
Theme page full importation
Theme page Temporary Admission