Aircraft Management Contract Template for the United States

When you own an aircraft but lack the time, expertise, or resources to manage its day-to-day operations, an Aircraft Management Contract becomes your essential legal safeguard. This comprehensive agreement, also known as an aircraft management agreement, establishes the professional relationship between you as the aircraft owner and a qualified management company, ensuring your aviation investment operates safely, legally, and efficiently under United States aviation law.

What should an aircraft management contract checklist cover?

A well-drafted aircraft management contract sets out every service the management company will provide, the fees and payment terms, and who is responsible for each part of the operation. Use the checklist below to confirm your agreement is complete before you sign.

• Parties and effective date. Full legal names of the owner and the management company, the aircraft registration (tail number), and the start date and term of the agreement.
• Scope of management services. A clear list of the services provided, including scheduling, flight operations, maintenance oversight, and administrative support.
• Operational control. An explicit statement of whether the owner retains operational control or transfers it to the management company, since this drives liability and FAA compliance.
• Crew management. Pilot and crew hiring, qualifications, training, and duty-time responsibilities, and who employs the crew.
• Certificates and compliance. The FAA certificates the management company holds (for example an air carrier certificate for charter under Part 135), plus registration and airworthiness records.
• Fees and payment terms. Management fees, hourly operating costs, fuel surcharges, expense reimbursements, invoicing schedule, and payment due dates.
• Insurance. Minimum coverage amounts, named insureds, hull and liability cover, and how risk is allocated between the parties.
• Maintenance and records. Maintenance standards, inspection schedules, and record-keeping responsibilities to keep the aircraft compliant.
• Rights and obligations. Each party's rights over the aircraft, base of operations, home hangar arrangements, and the good-faith standards both sides agree to meet.
• Third-party arrangements. How third-party charter clients, vendors, and fuel or maintenance providers are engaged, and who bears responsibility in each case.
• Charter revenue. If the aircraft is used for charter, how revenue is shared and how availability is set between owner and client bookings.
• Term and termination. The length of the agreement, renewal terms, notice periods, aircraft return conditions, and outstanding financial obligations on exit.

When do you need this document?

You need an Aircraft Management Contract whenever you're transferring operational responsibilities to a professional management company. This situation commonly arises when you own a business jet but prefer to focus on your core business rather than aviation operations. Corporate owners frequently use these contracts to ensure their aircraft meets rigorous safety standards while remaining available for business travel. High-net-worth individuals often require this document when they want professional oversight of their aircraft without the burden of managing pilots, maintenance schedules, and regulatory compliance. The contract is also essential when you're considering charter operations to offset ownership costs, as it clearly defines operational control and revenue-sharing arrangements.

Key legal considerations

Operational control represents the most critical aspect of your Aircraft Management Contract, as Federal Aviation Regulations require clear designation of who maintains authority over flight operations. Your contract must explicitly state whether you retain operational control or transfer it to the management company, as this determination affects liability, insurance requirements, and regulatory compliance. Fee structures require careful attention, including management fees, hourly operating costs, fuel surcharges, and expense reimbursements. Insurance provisions must specify minimum coverage amounts, named insureds, and liability allocation between parties, along with third-party liability toward passengers and charter clients. Termination clauses should address notice periods, aircraft return conditions, and outstanding financial obligations. The contract must also establish maintenance standards, crew qualifications, and record-keeping responsibilities to keep the aircraft compliant with the FAA.

What services does a management company provide?

A management company typically provides a defined set of services rather than an open-ended arrangement, and the contract should name each one. Common services include flight scheduling, dispatch, pilot staffing, maintenance coordination, hangar and fuel arrangements at the aircraft's home base, insurance placement, and financial reporting to the owner. Where the aircraft is offered for charter, the company also handles third-party client bookings and remits the owner's share of revenue on the agreed dates. Listing each service, its cost, and who is responsible removes ambiguity and keeps both parties aligned on what is delivered.

Legal requirements in United States

Your Aircraft Management Contract must comply with Federal Aviation Regulations, particularly FAR Part 91 governing general aviation operations and FAR Part 135 if charter operations are involved. The management company must hold appropriate FAA certificates and demonstrate compliance with operational specifications. Tax implications under the Internal Revenue Code require clear documentation of business versus personal use, as this affects deductibility and federal excise tax obligations. Labor law compliance becomes crucial when the contract involves crew employment, requiring adherence to Fair Labor Standards Act provisions and pilot duty time regulations. State-specific requirements may include business registration, insurance mandates, and hangar lease regulations. The contract must address DOT compliance requirements and establish procedures for regulatory reporting and inspection cooperation.