07 March 2018
On 3 March 2018, while a large proportion of the British Isles were spending the weekend hunkered down against the icy effects of the “Beast from the East” and Storm Emma, the Isle of Man Aircraft Registry (IOMAR) welcomed onto its books the 1000th aircraft to carry the “M” prefix – a brand new Gulfstream G650ER worth (at least) an eye-watering US$68m.
It’s a far cry from the extremely modest initial expectations for the number of aircraft to be registered with IOMAR upon its inception in May 2007. But the numbers speak for themselves. Just 12 registrations were forecast in year one – 51 were achieved! Then 76 in year two, and around 100 new aircraft year on year since then. As a result, it is not unusual to spot an “M” registered aircraft sitting on the tarmac as you fly into any airport around the globe.
The IOMAR has proven to be an unqualified success, receiving many aviation industry awards as well as consistently riding high in the aircraft registry league tables as it continues to attract some of the world’s most valuable business aircraft. Indeed, the IOMAR is the world’s leading and largest offshore business jet register, competing with established jurisdictions such as Bermuda, Cayman Islands and Aruba. It’s also sixth largest overall in the world for business aircraft, after the US, Brazil, Mexico, Canada and Germany. That’s pretty good company to keep!
So why do people pick the Isle of Man to register their aircraft?
To answer that question, it’s necessary to wind back the clock to over a decade ago, to the years preceding the inauguration of the IOMAR.
For many years prior to 2007, the Isle of Man Government had been in negotiations with the UK Department for Transport with a view to creating its own aircraft register strictly for private/corporate aircraft – i.e. no active commercial airliners or aircraft engaged in selling charter hours on a commercial basis.
Similar to the success of the Isle of Man Ship Registry, which saw the island as a registry of choice for many superyachts, it was anticipated that an aeronautical counterpart would enhance business opportunities for the island’s corporate services sector by offering aircraft owners some unique advantages, including a favourable tax regime and aircraft registration mark neutrality – but always with a focus on ‘safety with service’, which has since become the motto of IOMAR. (However, it’s no secret that some owners also like to have some fun and get creative with their out-of-sequence registration M-ARKS…)
From the very start, the Isle of Man Government has been absolutely insistent that an Isle of Man aircraft registration would not be a registration of convenience; rather, a cost-neutral foundation upon which to assist the growth of the business aviation industry. The latter is clearly evident. Locally, a well-established community of professionals can be called upon to handle every aspect of an aircraft’s operation, whether legal, fiscal or technical in nature.
Internationally, IOMAR has enabled transacting counterparts, be they lenders or aircraft operators, to take comfort in the robustness and reputation of the Isle of Man from a legislative and regulatory perspective, as well as the flexibility (this latest registration took place out of hours at the weekend), efficiency and technical knowledge of its staff, who oversee all aspects of registration, certification and upkeep of the aircraft mortgage register.
But success attracts attention and they say that imitation is the sincerest form of flattery. Several new aircraft registries have recently emerged (Guernsey and San Marino in particular), determined to replicate the IOMAR’s success against the backdrop of a positive outlook for the business aviation market. However, with the Isle of Man Government’s substantial investment in a new Aircraft Registry Digital Information System (ARDIS), overhauled IOMAR website and commitment to providing a global network of technical partners for survey purposes, it’s clear that the IOMAR intends to do what it takes to stay ahead of the competition.
Chris Nicholls is a manager for First Names Group in the Isle of Man. He is an integral part of our specialist Private Client Yachting and Aviation team, focused on the provision of expert solutions in respect of superyacht and high-value aircraft ownership and administration.
This article has been issued by First Names (Isle of Man) Limited which is licensed and regulated by the Isle of Man Financial Services Authority. The article has been prepared for general circulation to clients and intermediaries, and does not have regard to the particular circumstances or needs of any specific person who may read it. Nothing in this publication constitutes legal, accounting or tax advice or investment advice.
The information contained in this publication has been compiled by First Names (Isle of Man) Limited and/or its affiliates from sources believed to be reliable, but no representation or warranty, express or implied is made to its accuracy, completeness or correctness. All opinions and estimates contained in this report are judgements as of the date of publication, and are provided in good faith but without legal responsibility.
