Aicraft Title & Registrations: Philippines

Aircraft shall be registered with the Civil Aviation Authority of the Philippines (hereinafter, the “CAAP”). CAAP is responsible for the following: (a) establish and maintain a system for the national registration of aircraft in the Philippines; (b) establish and maintain a system for the registration of liens, mortgages, or other interests in aircraft or aircraft engines; and (c) have sole authority to register aircraft and liens, mortgages or other interests in aircraft or aircraft engines.

It is an operator registry. The Philippine Civil Aviation Regulations (hereinafter, the “PCAR”) provides that no person may operate a civil aircraft unless it has been registered by its owner or operator.

The PCAR provides that an aircraft is eligible for registration if it is: 3  

The following are the requirements for the registration of aircraft: 4 

All documents issued and/or signed outside the Philippines must be apostilled or consularized at the Philippine Consulate in that country. 

A registration fee shall be paid for the registration of aircraft. Such fees shall depend on the aircraft’s weight, intended use, type of engine, and type of aircraft. An energy tax fee and a recording fee may also be paid.

There are no weight or age restrictions to register an aircraft in the Philippines. However, in general, all aircraft would be subject to airworthiness evaluation by the CAAP. 

Republic Act 94979 (hereinafter, the “CAAP Law”) provides that the Certificate of Registration is conclusive evidence of ownership, except in a proceeding where such ownership is, or may be, at issue. However, since this is an operator registry, if the operator is registered as a “lessee,” then the ownership can be annotated on the Certificate of Registration. 

The following are the requirements for the transfer of ownership of aircraft:

A new Certificate of Registration will be issued for the registration of an aircraft with the same nationality and registration mark. A new entry shall be made on the Philippine aircraft register. The process will be the same as the registration of an aircraft.11 

All conveyance recorded under the CAAP Law shall comply with the requirements for the registration of documents similar to the land registration process. The conveyance to be recorded shall also state: 

All documents issued and/or signed outside the Philippines must be apostilled or consularized at the Philippine Consulate in that country. 

The aircraft Certificate of Registration shall contain the following13: 

Any person may request access to information from CAAP, including the list of entries in the aircraft registry, if it does not fall within any of the exceptions under the Freedom of Information Manual of CAAP. 

As a rule, no fees shall be payable for any request for access to information. However, a reasonable fee may be imposed for the reimbursement of necessary costs, including costs of reproduction, and copying of the information required, subject to existing rules and regulations. In no case shall the applicable fees be so onerous as to defeat the purpose of the right to access information.

PCAR Part 8 provides that Aircraft Operations that can be conducted with the registered aircraft are commercial air transport operations and general aviation operations

Commercial air transport shall include operations involving the transport of passengers, cargo, or mail for remuneration or hire. General aviation operation refers to any other aircraft operations than a commercial air transport operation or an aerial work operation.  

As a rule, there is a nationality restriction when it comes to the registration and operation of aircraft in the Philippines. Only aircraft owned by or leased to a citizen or citizens of the Philippines, corporations or associations organized under the laws of the Philippines at least sixty per centum (60%) of whose capital is owned by Filipino citizens or a government entity of the Republic of the Philippines may be registered and operated in the Philippines.  

However, the PCAR provides for an exception. A foreign-owned or registered aircraft may still be registered and operated within the Philippines, if utilized by members of aero clubs organized for recreation, sport, or the development of flying skills as a prerequisite to any aeronautical activities of such clubs within the Philippine airspace, and if so, authorized by CAAP. This means that foreign-owned aircraft may be registered and engage in operations of domestic air travel only. Foreign registered aircraft may still be authorized to operate in and to the Philippines. The PCAR allows foreign-registered aircrafts to perform commercial air transport operations in and to the Philippines upon issuance of a Validation of Air Operator Certificate. A Validation of Air Operator Certificate will be issued by the Director General upon satisfaction of the following: 

No. Section 43 of the CAAP Law provides that CAAP shall: (a) establish and maintain a system for the national registration of aircraft in the Philippines; (b) establish and maintain a system for the registration of liens, mortgages, or other interests in aircraft or aircraft engines; and (c) have sole authority to register aircraft and liens, mortgages or other interests in aircraft or aircraft engines. 

No conveyance made or executed, which affects the title to, or interest in, any aircraft of Philippine registry, or any portion thereof, shall be valid in respect to such aircraft or portion thereof against any person, other than the person by whom the conveyance is made or executed, his heirs, assignees, executors, administrators, devisees, or successors in interest, and any person having actual notice thereof, until such conveyance is recorded in the CAAP and annotated at the CAAP original copy of the Certificate of Registration. Each conveyance so recorded shall be valid as against all persons. 

No adverse claims may be recorded or annotated at the back of the Certificate of Registration unless originals of the documents are presented evidencing said claims and the payment of the corresponding fee.

After submission of a written letter from the owner requesting for the recordation of conveyances that affects the Certificate of Registration, the conveyance may be recorded only after the completeness of the submitted documents are verified. The following documents must be submitted: 

Upon approval, the duplicate copy of the Certificate of Registration including all attached documents shall be forwarded to the Regulatory Standards Department for record keeping and updating of official database. 

Mortgage priority notice is not an available security instrument for aircraft financers in the Philippines. 

Yes. As mentioned in the previous questions, the CAAP is mandated to maintain a system for the registration of liens, mortgages, or other interests in aircraft or aircraft engines. CAAP Law provides that CAAP shall establish a national system for recording documents that affect title to or any interest in any aircraft registered and in any aircraft engine propeller, appliance, or spare parts intended for use on any such aircraft.

The Civil Code of the Philippines provides that for specific movable properties of the debtor, duties, taxes, and fees due thereon to the State or any subdivisions thereof shall be preferred. This shall include, but not limited to, unpaid taxes under the National Internal Revenue Code, as amended (hereinafter, the “Tax Code”), the Customs Modernization and Tariff Act (hereinafter, the “CMTA”), any liens imposed by the Director General under the CAAP Law.

The Tax Code further provides that an excise tax imposed on imported goods, products, machinery equipment, or other similar articles shall constitute a lien which shall be superior to all other charges or liens, irrespective of the possessor.

The CAAP Law provides that the Director General of CAAP shall have the power to impose a lien on personal and real properties, and other assets of persons, corporations, partnerships, and such other entities that shall be in default, or fail to perform their obligations, or fail to pay the fines, and other penalties imposed for violations of the law, rules, and regulations of CAAP. 

Properties and assets levied upon may be sold and the proceeds applied to the satisfaction of the obligation after due notice and hearing.  

The Civil Code provides that an unpaid seller of goods has a lien on the goods or right to retain them. It also recognizes possessory liens in respect of credits for the making, repair, safekeeping, or preservation of personal property

The Tax Code also authorizes the distraint or the sale of personal property to pay any tax due within the time required.  

The CMTA further provides that liability for duties, taxes, fees, and other charges attached to importation constitute a lien on the imported goods which may be enforced while such goods are under customs’ custody.  

In addition, Executive Order No. 903 provides for remedies for non-payment of any charges on the aircraft. It provides that the Manila International Airport Authority, in addition to any other remedy provided by law, detain, on its own, such aircraft equipment or furniture belonging to the owner or agent of the aircraft, until the amounts due have been paid

Yes. Philippine laws generally allow the parties to choose which law shall govern their agreement or their contracts provided that it is not contrary to law, morals, public policy, or public order. However, such agreements, to be registrable, must be authenticated either at the Philippine Consular Office or the Philippine Embassy where the agreement was executed. If the country where executed is also a signatory to the Hague Convention on the Apostille, an apostille should also suffice in lieu of consularization. 

As mentioned in item 18, Philippine laws allow the parties to choose which law shall govern their agreement or their contracts provided that it is not contrary to law, morals, public policy, or public order. 

In order for such contract of lease to be registered in the Philippines, the aircraft lease executed outside the Philippine territory must be authenticated either at the Philippine Consular Office or the Philippine Embassy where the said aircraft lease contract was executed. 26 If the country where executed is also a signatory to the Hague Convention on the Apostille, an apostille should also suffice in lieu of consularization. Normally, the lease is also annotated on the aircraft’s Certificate of Registration. 

The Philippines has not ratified the Cape Town Convention on International Interests in Mobile Equipment and the related Aircraft Protocol as of this writing. 

A letter of intention to deregister the aircraft in the Republic of the Philippines shall be prepared by the applicant. The Chief of the Aircraft Registration Section shall review the request to  

determine the validity and authenticity of the request

The applicant must also submit the following: 

If the aircraft has an annotation, the applicant shall be required to settle/clear all derogatory or liens/encumbrances, prior to deregistration. No aircraft registered pursuant to Philippine civil aviation regulations shall be deregistered until and unless all liens and encumbrances annotated on the Certificate of Registration have been complied with or declared by competent authorities as null and void or ineffective. 

The usual process involves filing the application for deregistration at the Aircraft Registration Section, who will then forward it to the legal department for review, before finally forwarding it to the Director General’s office for approval. 

A deregistration fee shall be paid for the deregistration of aircraft in the registry. If there are annotations to be cancelled, the Certificate of Registration shall be reissued with cancelled annotations which shall also have a fee payable. 

In general, the deregistration fee is Php750 and reissuance fee of Certificate of Registration and recording fee for cancellation of annotation would have fees of Php400 each, respectively. These are Value Added Tax exclusive (which is 12% as of this writing). 

Consent is not required, per se. However, if a registered aircraft has an annotation (i.e., lease agreement, mortgage, pending accounts with CAAP), the applicant shall be required to settle or clear all derogatory or liens/encumbrances, prior to deregistration of aircraft. 

No aircraft registered pursuant to Philippine Civil Aviation Regulations shall be deregistered until and unless all liens and encumbrances annotated on the Certificate of Registration have been complied with or declared by competent authorities as null and void or ineffective.

The major factor to consider is whether the deregistration is voluntary or involuntary in nature. If the deregistration is voluntary in nature, the difficulty is more on the documentation involved, especially if executed outside the Philippines. If the deregistration is involuntary, a power of attorney for deregistration would be very helpful and has been recognized in the past by the CAAP as a valid instrument to effect deregistration. 

It cannot be easily determined how long a deregistration process may take if there is without cooperation from the defaulted party. As mentioned in the previous question, difficulties may arise if the document involved was executed outside the Philippines. The CAAP may also require further information and documentation to assure itself of the facts and circumstances of the default. 

On the other hand, if there is cooperation from the defaulted party, the process may be done faster and will depend on how fast the parties will be able to prepare and submit the required documents. 

Once the necessary documents are complete and submitted, officially at least, the application for deregistration should take three (3) days to process. But based on actual experience, the average processing time is about two (2) weeks. 

The rightful owner of the aircraft should file for an action in court to repossess the aircraft. Under Rule 60 of the Philippine Rules of Court, a party praying for the recovery of a personal property may, at the commencement of the action or at any time before answer, apply for an order for the delivery of the personal property. The applicant shall file an affidavit providing that (1) he is the owner of the property claimed, or entitled to possession thereof, particularly describing the property; (2) that the property is wrongfully detained by the adverse party, alleging the cause of detention thereof; (3) that the property has not been distrained or taken for a tax assessment or a fine pursuant to law, or seized under a writ of execution or preliminary attachment, otherwise placed under custodial egis, of if so seized, that it is exempt from such seizure or custody; and (4) the actual market value of the property.  

A bond shall be posted by the applicant, executed to the adverse party amounting to double the value of the property as stated by the applicant in its affidavit, for the return of the property to the adverse party if that return be adjudged, and for the payment to the adverse party of such a sum as he or she may recover from the lessor in the action. 

 Once the affidavit is filed and the bond is approved, the court shall issue a writ of replevin and require the sheriff to take such property into his custody.