Return to front page
navigation FBO Operator Interior Recruitment Training OEM MRO Support Rotor
Translation and Social Media. BlueSky App Twitter French German Spanish Italian Portuguese Chinese Arabic Search Facebook

United States

Navigating Russian sanctions in corporate jet transactions

By Jonathan M. Epstein and Libby Bloxom, Holland & Knight LLP



The US, European Union (EU), United Kingdom (UK) and many other countries have imposed similar but not necessarily identical sanctions on Russia. In corporate jet transactions, the sanctions laws of several jurisdictions may be implicated.

Sanctions and export control restrictions affecting aviation include:

Navigating Russian sanctions in corporate jet transactions

Red Flags in Aircraft Transactions

In international aircraft transactions, buyers, brokers and attorneys need to be on the alert for information that there is a Russia nexus. Some red flags that may warrant further investigation are:

Such red flags do not necessarily mean the transaction cannot go through, but rather, they likely warrant enhanced diligence to ensure that the transaction does not violate sanctions and that the buyer can take good title and receive support for the aircraft after closing.

Steps Parties Can Take to Protect Themselves

Where there are red flags or other risk factors, parties should certainly include additional contractual protections and representations regarding sanctions. However, such representations are not due diligence and will not protect a party from sanctions. Rather, it is critical for a party to conduct and document enhanced due diligence that may include the following examples:

Will the US Government Help?

Sanctions are aimed at Russia and certain Russian persons, and the US government has been willing to assist US citizens and others, particularly where such assistance will remove assets from Russian hands and in the interests of aviation safety.

Risks in Engaging in Transactions Involving Russian-Owned Aircraft

There are both legal and practical risks that robust due diligence can mitigate against. In addition to reputational harm, a party may be strictly liable for civil penalties or subject to other sanctions, and in the US, there are criminal penalties for intentional violations. Further, the aircraft itself could be seized by authorities, for example, when it enters the US In such circumstance, the asset could be forfeited unless the new owner can show they are a bona fide buyer who had no knowledge (after conducting diligence) that the aircraft was tainted property. Similarly, funds transfers could be blocked by banks where an SDN is directly or indirectly involved in a transaction.

If you have questions about the sanctions related to the aviation industry, please contact the authors. For information about the firm's business aviation practice, please contact any member of Holland & Knight's Business Aviation Group.


The Authors

Jonathan M. Epstein (Partner) and Libby Bloxom (Associate) at US multinational law firm, Holland & Knight LLP.

Jonathan M. Epstein Libby Bloxom

This article provides a high-level overview of sanctions as of May 10, 2022. It is not intended to be legal advice, and parties are urged to consult with their counsel as these sanctions and export control restrictions are complex, fact-specific and rapidly changing.

click to visit Satcom Direct

click to visit air bp




















































































































































BlueSky Business Aviation News | 12th May 2022 | Issue #653



Share this article



Back to our front page Order your FREE weekly copy of BlueSky now!