GERMANY Law and Practice Contributed by: Konrad Schott, Jan Brinkmann and Johannes Vogel, Freshfields
2.2.4 Risk of Title Annexation Title to an engine does not vest in the person hold - ing title to an airframe merely by installing the engine on the airframe. However, if the same person holds title to the airframe and the engine, and the engine is on-wing or temporarily off-wing, the German aircraft mortgage ( Registerpfandrecht ) granted over the air - frame may extend to that engine. The regime appli - cable to aircraft parts upon their installation depends on whether the specific part is classified as a part ( Bestandteil ), an essential part ( wesentlicher Bestand- teil ) or an accessory (Zubehör). Automatic title transfer upon installation is only conceivable with respect to essential parts and only if additional requirements are fulfilled. As regards parts and accessories, an antici - pated agreement to transfer title upon installation in the respective transaction document is conceivable. 2.2.5 Recognition of the Concepts of Trust/Trustee The concepts of a common law trust and an owner trustee of a common law trust are not recognised under German property law because the separation of legal title from equitable title is not compatible with the German legal concept of title. Germany has not ratified the Hague Convention on the Law Applicable to Trusts and on their Recognition. However, a statu - tory trust with its own legal personality and an owner trustee of such trust are recognised in such capaci - ties. The German Civil Aviation Authority ( Luftfahrt- Bundesamt or LBA) is likely to disregard a common law trust arrangement and has occasionally registered the trustee as an unrestricted owner in the past. 2.3 Lease Registration 2.3.1 Notation of Owner’s/Lessor’s Interests on Aircraft Register The purpose of the German aircraft register is to imple - ment the rules of Part 1 – Chapter III of the Convention on International Aviation (the “Chicago Convention”), which is devised to maintain the safety of navigation of civil aircraft, but not to constitute or allocate in rem rights in aircraft. The aircraft register records the own - ership interest of the holder of legal title to the aircraft as notified to the LBA but does not prove ownership, and the registration of a person as owner in the aircraft register does not establish any ownership interests or perfect transfer of title. The interest of a lessor of an aircraft is not recorded in the aircraft register.
2.3.2 Registration If the Owner Is Different From the Operator An aircraft cannot be registered in the name of the aircraft operator if the operator is not the owner of the aircraft. An aircraft must be registered in the name of the owner. 2.3.3 Aircraft/Engine-Specific Registers Engines (whether installed on an airframe or not) are not registered or even mentioned in the German air - craft register. 2.3.4 Registration of Leases With the Domestic Aircraft Registry Neither a lease nor a lessor’s interest in or under an aircraft lease can be registered or recorded in the German aircraft register. However, an aircraft lease to which a German operator is a party requires approval by the LBA prior to the commencement of the services and needs to be submitted to the LBA for that pur - pose. In a multi-tier lease structure, this rule applies to the entire chain of leases. 2.3.5 Requirements for a Lease to Be Valid and Registrable It is not necessary for a lease to be translated, certi - fied, notarised or apostilled/legalised to be enforce - able against a domestic party. As a matter of practice, the LBA accepts leases in German or English. If the lease is in any other language, the LBA may require that the lease, or excerpts, be translated and such translations certified by a registered translator. 2.3.6 Taxes/Duties Payable for Registering a Lease As an aircraft or engine lease cannot be registered, there are no taxes/duties triggered by the aircraft reg - istration. 2.3.7 Registration of Aircraft in Alternative Countries Generally, an aircraft is registered in the state in which its operator is domiciled, unless international treaties on the basis of Article 83bis of the Chicago Conven - tion permit otherwise. As a practical observation, pri - vate and corporate jets operated in Germany are often registered in the USA. Commercial aircraft operated by German airlines and habitually based in Germany are typically registered in Germany.
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