Sale and purchase of second hand aircraft
Produced in partnership with Norton Rose Fulbright
Sale and purchase of second hand aircraft

The following Banking & Finance guidance note Produced in partnership with Norton Rose Fulbright provides comprehensive and up to date legal information covering:

  • Sale and purchase of second hand aircraft
  • Important provisions of a Purchase Agreement
  • Financing
  • Sale of an aircraft currently on lease
  • Taxes and delivery location
  • Cape Town

Purchase agreements for second hand aircraft are entered into between an aircraft owner (as the seller) and, in the majority of circumstances, an airline or aircraft leasing company (as the buyer). The terms of purchase agreements are usually kept confidential between the parties but some terms will be disclosed to a lender to the buyer if it is providing the airline with funding with respect to an aircraft to be purchased in accordance with the terms of that purchase agreement.

There is no standard form purchase agreement with respect to second hand aircraft, although some sellers will have a form of purchase agreement which they prefer to enter into with their customers. The requirements of different parties in relation to second hand aircraft sale and purchases and the commercial details of such transactions vary considerably, and are discussed in more detail below.

Important provisions of a Purchase Agreement

Agreement for sale and purchase

This clause sets out the aircraft seller’s agreement to sell and the buyer’s agreement to purchase the aircraft, and may relate to one or more aircraft. The agreement to sell and purchase will usually express that the aircraft is to be sold in an ‘as is, where is’ condition and will be subject to the fulfilment of certain conditions by each party, which are broadly as follows:

Buyer’s Conditions: