A Call to Incentivize Business Jets to be Based in Russia


Many Russian owners would gladly base their aircraft in Russia if the economics worked. This is a true statement, based on statements made by our clients and the talk in the Russian business aviation community.

Russian owners of aircraft would like their aircraft to be immediately available to them at a nearby airport without having to be flown in from a foreign country. Russian owners would like to have Russian pilots fly their aircraft, and would like an adequate number of Russian pilots to be trained. Russian owners would like to be able to charter their aircraft for use inside Russia without having to assume the substantial risks and costs involved in flying foreign-registered aircraft in Russia. Russian owners do not want to have to pay bribes to fly their aircraft inside Russia, yet that is what today's system promotes. Russian owners do not want to have to struggle to get themselves included in a special list of persons who are exempted from generally applicable prohibitions on flying foreign-registered aircraft within Russia. Russian owners would like to be able to use their aircraft entirely legally within Russia for personal and commercial purposes. Russian owners want to allow their aircraft to be chartered by Russian and foreign businesses which would like to fly their officers within Russia (corporate officers who are here to consider new investments in the Russian economy), on fully-legal flights on modern, Russian-owned aircraft that are made available for charter inside Russia. Russian owners do not want to pay, and can not afford to pay, unreasonably high import VAT that has no parallel elsewhere in the world in order to bring their aircraft to Russia. Russian owners do not want to pay, and cannot afford to pay, monopolistically high prices to base their aircraft at one of the few fixed base operators which has acquired monopolistic control at Moscow and other airports.

Key words: business jet, import VAT, cabotage, domestic flight

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DISCLAIMER: Because of the generality of this update, the information provided herein may not be applicable in all situations and should not be acted upon without specific legal advice based on particular situations.

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