Aircraft Title and Lien Searches in Cross-Border Transactions: What Buyers Miss

An aircraft acquisition is unlike most asset purchases. The asset itself is mobile across jurisdictions by design, registered in one country, financed by lenders in another, operated by lessees in a third, and maintained under certifications issued by regulatory authorities that may not communicate with each other. The title and lien risk profile that results from this jurisdictional complexity is substantial — and it is frequently underestimated by buyers, particularly in cross-border transactions.

This post addresses the title examination and lien search process for international aircraft acquisitions, with attention to the gaps that appear most consistently in due diligence and the consequences of missing them.

The United States Federal Aviation Administration (FAA) Registry: Necessary but Not Sufficient

For aircraft registered in the United States, the FAA Civil Aviation Registry (FAA Registry) in Oklahoma City, Oklahoma is the primary source of title and lien information. The registry records aircraft registration, certificates of airworthiness, recorded liens and security interests, and ownership transfers. A search of the FAA Registry is the starting point for any U.S.-registered aircraft title examination.

The critical limitation of the FAA registry is that it only records instruments that have been properly submitted for recordation. Interests that are valid under applicable state or foreign law but not recorded with the FAA — security interests perfected under state Uniform Commercial Code (UCC) Article 9 filings, foreign judgments, tax liens, mechanic's liens in jurisdictions that permit them on aircraft — may not appear in a registry search. A clean FAA registry search does not mean a clean title.

For aircraft that have operated in multiple countries, the FAA registry search must be supplemented by searches in each jurisdiction where the aircraft was registered, financed, or regularly based. An aircraft with an FAA registration certificate that spent five years on wet lease (aircraft lease including crew, maintenance, and insurance) in Europe will have touched multiple regulatory and legal systems that may have generated interests not recorded with the FAA.

The Cape Town Convention and the International Registry

The Cape Town Convention on International Interests in Mobile Equipment, together with its Aircraft Protocol, created the International Registry of Mobile Assets (International Registry) — a global priority notice system for interests in aircraft objects (airframes, aircraft engines, and helicopters meeting minimum size thresholds). As of 2026, the Convention has been ratified by over 80 countries, covering the majority of the world's commercial aviation activity.

Under the Cape Town system, a prospective purchaser who registers a "prospective international interest" or a "contract of sale" with the International Registry obtains priority protection against subsequently registered interests and, in Contracting States (signatories to the Cape Town Convention) that have adopted the relevant alternative, against unregistered pre-existing interests. The practical effect is that international aircraft transactions structured to use the Cape Town registration system can achieve a clean title result that does not depend entirely on the adequacy of national registry searches.

However, the Cape Town system only works as intended if the transaction is properly structured to use it. Buyers who do not register their acquisition or who close without searching the International Registry for pre-existing registered interests are forgoing the protections the system provides. This is a surprisingly common gap in cross-border aircraft transactions, particularly for business jets and turboprop aircraft where buyers may not be working with counsel experienced in Cape Town practice.

Engine Title: The Separate Asset Problem

Aircraft engines are separate assets from the airframe under aviation law in most jurisdictions. An engine can be separately owned, separately financed, separately leased, and separately liened from the airframe on which it is installed. This creates a title examination problem that is frequently missed in aircraft acquisitions: a buyer who carefully examines airframe title and confirms a clean result may be acquiring an airframe with engines that are subject to security interests, lease agreements, or ownership claims in the name of third parties.

Engine title examination requires searching the relevant registries (FAA for U.S.-registered engines, the International Registry for engines meeting Cape Town thresholds, and national registries for engines registered in non-Cape Town countries) by engine serial number for each engine installed on the aircraft at closing. An engine that was swapped during maintenance — a routine occurrence — may have a completely different title history from the airframe.

Engine leases are particularly common in commercial aviation. An airline that owns its airframes may operate them with engines on short-term lease from an engine leasing company. A buyer who acquires the airframe in a foreclosure or distressed sale without verifying engine ownership may discover post-closing that the engines must be returned to their lessor.

Maintenance Reserve Claims and Off-Balance-Sheet Obligations

In aircraft lease transactions, lessees typically pay maintenance reserves — periodic deposits held by the lessor to fund major maintenance events (C-checks (scheduled major airframe maintenance events), engine overhauls, landing gear overhauls). At lease termination, the accounting of maintenance reserves — how much was paid in, how much was consumed, what is owed to whom — can generate significant claims between lessor and lessee.

A buyer acquiring an aircraft out of a lease relationship (whether by purchasing from the lessor or acquiring the lessor's interest) may inherit unresolved maintenance reserve disputes that become the buyer's problem post-closing. These disputes can involve millions of dollars on large commercial aircraft and are a form of contingent liability that does not appear on any registry but must be identified through contract review and direct inquiry to the prior lessor-lessee relationship.

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