Commercial Privs and Limits

Mjg2011

Mjg2011

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Mjg2011
I'm studying for my commercial ride and am a little confused on privs and limits. Can I charge my friends for the whole flight (I would not be paying for the flight at all and would be compensated with flight time) if I rent the aircraft from a local flight school?
 
No.

this is a conglomeration of posts I've made on the subject a number of folks have said they found useful. Maybe you will too. Maybe not. (It's a copy and paste. I didn't just type this).


This is the way I teach it. It works better one-on-one since there are always questions, but FWIW, here goes...

The single most important thing to learn is, *there is a difference between the privileges of a commercial "pilot" certificate and the requirements for engaging in a commercial "operation."* If you fly for compensation, you are exercising a "commercial pilot" privilege. If you provide both pilot and airplane to transport other people or their property for compensation, you are engaged in a "commercial operation."

To give simple examples, if you are hired as a corporate pilot to fly a company airplane or to ferry someone else's airplane, you are only providing them commercial "pilot" services. Their airplane; your services. OTOH, if you take your C182 and start doing air tours or start flying your neighbors to their vacation spots, you are engaged in a commercial "operation."

Get that difference, and you are *way ahead* of most in understanding this stuff.

From there, move to FAR 119.1(e). Most commercial "operations" (providing aircraft and pilot) require an operating certificate of some type. Might be Part 135 (charter and some smaller airlines), 121 (the big airlines), but some kind of operating certificate. FAR 119.1(e) is a list of commercial "operations" that do not require an operating certificate. That "air tour?" 119.1(e) says, "no operating certificate required," although there are some other requirements. Transporting that cargo? There is no 119.1(e) exception, so you need an operating certificate.

There are two other, related, concepts you need to understand. One is the difference between "common" and "private" carriage. "Carriage" just means providing airplane and pilot for transporting persons or property. "Common" means offered to the public, or, as the FAA puts it, a segment of the public. "Private" means only with a very select few.

The difference between the two is the other important concept - "holding out." I mention it last because It's always used as though it is some evil thing. But all it really means is "letting people know." "Holding out" makes it "public."

If all that leaves you thinking the lines are blurry, you are right. After all, how does anyone know you are available to transport them in "private" carriage unless you let them know? The reality is, it's so blurry, it doesn't make any practical difference. The fact that "carriage" is private does not mean you can do it with just a commercial pilot certificate. FAR 119.23 says "private" carriage requires an operating certificate, with some exceptions. Operating certificates for "noncommon" or private carriage are also mentioned in 119.5. There is even a sample of a private carriage Part 135 certificate in FSIMS (reproduced here - http://midlifeflight.net/posted/PrivateCarriageOpCert.png)

Bottom line, public or private, if you provide airplane and pilot for a purpose other than one listed in 119.1(e) , you need some kind of operating certificate. But you still have to understand the difference because it gets tested.

I wouldn't worry too much about more than understanding and being able to apply these basics - (1) your privileges are as a commercial pilot; (2) they don't automatically allow you to engage in a commercial operation; and (3) there needs to be some specific regulatory authority to engage in a commercial "operation," such as one of the activities permitted by 119.1(e) or under a Part 135 operating certificate.

Yeah, I know. It's complicated. That's why lawyers get paid big bucks to draft things like leases between a parent company and its 100%-owned subsidiary that does nothing but provide flight services *only* to its parent company - abut as "private cariage" as you can get. it's designed to prevent the subsidiary from being treated as a Part 135 operation.

Fortunately, it's mostly about understanding the basics such as, "does your commercial certificate allow you to take your neighbor and his family to their vacation destination in an airplane you own or rent and be paid for it? The answer is no since that would be a commercial "operation" and require a Part 135 operating certificate. Truth is, most DPEs don't understand more than the basics either.
 
midlifeflyer said:
No.

this is a conglomeration of posts I've made on the subject a number of folks have said they found useful. Maybe you will too. Maybe not. (It's a copy and paste. I didn't just type this).


This is the way I teach it. It works better one-on-one since there are always questions, but FWIW, here goes...

The single most important thing to learn is, *there is a difference between the privileges of a commercial "pilot" certificate and the requirements for engaging in a commercial "operation."* If you fly for compensation, you are exercising a "commercial pilot" privilege. If you provide both pilot and airplane to transport other people or their property for compensation, you are engaged in a "commercial operation."

To give simple examples, if you are hired as a corporate pilot to fly a company airplane or to ferry someone else's airplane, you are only providing them commercial "pilot" services. Their airplane; your services. OTOH, if you take your C182 and start doing air tours or start flying your neighbors to their vacation spots, you are engaged in a commercial "operation."

Get that difference, and you are *way ahead* of most in understanding this stuff.

From there, move to FAR 119.1(e). Most commercial "operations" (providing aircraft and pilot) require an operating certificate of some type. Might be Part 135 (charter and some smaller airlines), 121 (the big airlines), but some kind of operating certificate. FAR 119.1(e) is a list of commercial "operations" that do not require an operating certificate. That "air tour?" 119.1(e) says, "no operating certificate required," although there are some other requirements. Transporting that cargo? There is no 119.1(e) exception, so you need an operating certificate.

There are two other, related, concepts you need to understand. One is the difference between "common" and "private" carriage. "Carriage" just means providing airplane and pilot for transporting persons or property. "Common" means offered to the public, or, as the FAA puts it, a segment of the public. "Private" means only with a very select few.

The difference between the two is the other important concept - "holding out." I mention it last because It's always used as though it is some evil thing. But all it really means is "letting people know." "Holding out" makes it "public."

If all that leaves you thinking the lines are blurry, you are right. After all, how does anyone know you are available to transport them in "private" carriage unless you let them know? The reality is, it's so blurry, it doesn't make any practical difference. The fact that "carriage" is private does not mean you can do it with just a commercial pilot certificate. FAR 119.23 says "private" carriage requires an operating certificate, with some exceptions. Operating certificates for "noncommon" or private carriage are also mentioned in 119.5. There is even a sample of a private carriage Part 135 certificate in FSIMS (reproduced here - http://midlifeflight.net/posted/PrivateCarriageOpCert.png)

Bottom line, public or private, if you provide airplane and pilot for a purpose other than one listed in 119.1(e) , you need some kind of operating certificate. But you still have to understand the difference because it gets tested.

I wouldn't worry too much about more than understanding and being able to apply these basics - (1) your privileges are as a commercial pilot; (2) they don't automatically allow you to engage in a commercial operation; and (3) there needs to be some specific regulatory authority to engage in a commercial "operation," such as one of the activities permitted by 119.1(e) or under a Part 135 operating certificate.

Yeah, I know. It's complicated. That's why lawyers get paid big bucks to draft things like leases between a parent company and its 100%-owned subsidiary that does nothing but provide flight services *only* to its parent company - abut as "private cariage" as you can get. it's designed to prevent the subsidiary from being treated as a Part 135 operation.

Fortunately, it's mostly about understanding the basics such as, "does your commercial certificate allow you to take your neighbor and his family to their vacation destination in an airplane you own or rent and be paid for it? The answer is no since that would be a commercial "operation" and require a Part 135 operating certificate. Truth is, most DPEs don't understand more than the basics either.
Click to expand...

That does clear things up a bit better. I appreciate the timely response.


Sent from my iPad using Tapatalk
 
BTW, illegal charter has become an enforcement focus for the FAA. I'm wondering whether the emphasis will be filtering down to DPEs. @Ryan F.?
 
tonycondon said:
I'm not Ryan. But for this DPE, you can expect to talk about 119.1 on the Commercial test and what you can/cant do.
Click to expand...
That's always been the case. I'm just wondering whether there will be some special emphasis beyond the usual because of the current focus on illegal charter operations. The enforcement division is aiming at it because of (im guessing) the increase in 134.5 ops due to COVID. FAASTeam anticipates WINGS seminars on the subject.
 
Questions are always at the beginning of most checkrides around here (all certs)
1. Show me you are qualified to apply for this rating
2. Show me the plane is airworthy
3. Explain to me what this certificate you are applying for allows you to do. (Privileges and limitations)
 
DPE: “So what does the commercial certificate allow you to do?”
Me: “People can pay me to fly their planes.”
DPE: “Good, let’s move on.”
 
ateamer said:
DPE: “So what does the commercial certificate allow you to do?”
Me: “People can pay me to fly their planes.”
DPE: “Good, let’s move on.”
Click to expand...

Well, most of it these days is done by scenario (a good thing). But using your dialog, what I'm curious about in my question about whether the enforcement focus on illegal charter will have a ripple effect is this:
DPE: “So what does the commercial certificate allow you to do?”
Me: “People can pay me to fly their planes.”
DPE: "How will you know the owner of that plane is not using you for illegal charter?"
 
midlifeflyer said:
Well, most of it these days is done by scenario (a good thing). But using your dialog, what I'm curious about in my question about whether the enforcement focus on illegal charter will have a ripple effect is this:
DPE: “So what does the commercial certificate allow you to do?”
Me: “People can pay me to fly their planes.”
DPE: "How will you know the owner of that plane is not using you for illegal charter?"
Click to expand...

Well, because his name isn't Epstein. :D
 
midlifeflyer said:
Well, most of it these days is done by scenario (a good thing). But using your dialog, what I'm curious about in my question about whether the enforcement focus on illegal charter will have a ripple effect is this:
DPE: “So what does the commercial certificate allow you to do?”
Me: “People can pay me to fly their planes.”
DPE: "How will you know the owner of that plane is not using you for illegal charter?"
Click to expand...
Answering that question from my experience, I’d have to say that if I actually wondered, I’d ask questions that people would be offended by, and so I wouldn’t be flying their airplane anyway.
 
It’s probably one of the most misunderstood topics in aviation. Scores of commercial students — and even flight instructors — don’t fully understand the rules surrounding being a commercial pilot. But the good news is that the regs are incredibly simple.

Having a commercial pilot certificate gives you the ability to get hired as a professional pilot. That’s it. And hired is the operative word.

With a few exceptions, you can get any flying job except a part 121 airline gig with just a commercial certificate (you’ll need an ATP cert for the airline job).

And yet, people somehow get themselves into trouble with the FAA for running illegal charter operations. Why?

Here’s the key: there’s NO pilot certificate lets you start a charter business, and airline, or some other type of aviation operation. For those, you’ll need a separate certificate from the FAA for your business operation — a 135 certificate or 121 certificate are good examples of those.

Think about it this way: if you were a culinary school grad, you’d need a bunch of licenses and approvals to open a restaurant — that’s not a limitation of your culinary school diploma, it’s a limitation of starting a business. You can still get hired by a licensed restaurant with your credentials, but the health department isn’t going to let you start a new restaurant without that piece of paper.

The commercial pilot limitations work the same way. To “hold out” as an aviation business, you need a license for that business from the FAA.

So, if a guy owns a plane you’re qualified to fly and needs a pilot, no problem — he can hire you to fly it for him.

If a charter operation is looking for first officers, apply away!

But if you’re offering your pilot services and the aircraft to fly someone to Myrtle Beach for the weekend, you’re obviously not just a pilot anymore. Suddenly, you’re a charter operator who’s holding out without a 135 certificate.

Why is that? Put simply, the reasoning is the exact same as the health department in the example above. When you open a restaurant, the health inspectors want to see the kitchen. They want to know where you’re sourcing your parts. Likewise, the FAA’s inspectors require a higher standard from 121/135 certificate holders — they require drug testing programs, and ops manuals, and higher pilot training for folks trying to provide flights to the general public.

There are some loopholes, though.

The FAA does provide is a set of exemptions under part 119.1 that allows CPL holders to automatically operate a number of businesses without needing a charter or airline certificate. A few examples include flight instruction (for those with CFI certificates), aerial survey and photography, air tours, ferry flights, cropdusting, and banner towing.

Those aren’t limitations to your pilot certificate, they’re extra benefits you have that get you around needing a separate certificate for your business! Thanks FAA!

When teaching commercial pilot privileges and limitations, people tend to intermingle those rules with part 121.135 certificate privileges — and that ends up confusing a lot of commercial pilot students about what they can do when they get their ticket. Just think of the restaurant analogy, and you’ll be able to figure out most scenarios a DPE can dream up on a checkride.

I’ll leave this here one more time: having a commercial pilot certificate gives you the ability to get hired as a professional pilot. If you’re trying to run a business that’s not covered by the part 119.1 exemptions, then you need an airline or charter certificate from the FAA.

Hope this help and didn’t confuse you even more.
 
midlifeflyer said:
There are no loopholes.
Click to expand...

Not a loop hole but an exception to the just-a-hired-pilot he started off with and the "That's it." You can be the pilot and provide the plane under very limited circumstance. But yeah, not a loophole.
 
midlifeflyer said:
There are no loopholes.
Click to expand...

And just remember, if you think you found one the FAA is the judge and jury. It's been tried and tried, and the FAA is the final say on whether it's a commercial operation. No one has won, no matter how they have tried to interpret the regulations.
 
EdFred said:
Not a loop hole but an exception to the just-a-hired-pilot he started off with and the "That's it." You can be the pilot and provide the plane under very limited circumstance. But yeah, not a loophole.
Click to expand...
Exactly. A "loophole" is a perceived ambiguity which allows one to circumvent a rule. The 119.1 list is a list of explicit "exceptions" requirement for an operating certificate is pretty explicit. Calling the list "loopholes" is like calling permissive "right turn on red" a "loophole" to the rules about red traffic lights.
 
BrianNC said:
Loophole, execution, etc. We all know what he meant.
Click to expand...
That works right up to the point that it doesn’t, at which time it can get ugly.

I’ve worked with enough people who argue for poor communication and/or ignorance over the years that I will continue to argue against them. ;)
 
Fabio said:
The FAA does provide is a set of exemptions under part 119.1 that allows CPL holders to automatically operate a number of businesses without needing a charter or airline certificate. A few examples include flight instruction (for those with CFI certificates), aerial survey and photography, air tours, ferry flights, cropdusting, and banner towing.

Those aren’t limitations to your pilot certificate, they’re extra benefits you have that get you around needing a separate certificate for your business! Thanks FAA!
Click to expand...

It's worth noting that for airplane and helicopter air tours, while you don't need an Air Operator Certificate, you do need a letter of authorization issued by the FAA and you stand up a drug and alcohol testing program.
 
I do like to pry a little into potential 134.5 stuff. More so because I fly for a Part 135 operator than from any guidance from above though
 
I have a question about air tours. Are far as I am aware light sport and or experimental aircraft are not permites for commercial purposes. So if you have a Pitts S2-C, for example, is there any to take people and “barn storming” air tours? Some type of special use exception/permit maybe?
 
So… PPL, non-instrument rated rents a plane from a flight school, then hires a CPL to fly him through clouds to somewhere. Legal? I think it’s likely in violation of the rental agreement but legal as far as CPL rules.
 
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