Aviation, or more specifically Air Transportation, has proven to be one of the most indispensable means of movement in the 21st century, with passengers and goods being able to literally traverse continents in just a couple of hours.
Like most innovations, it is not without its flaws, one of the most problematic flaws being the issue of safety and the close second being the constant possibility of Air Transportation being used to move illegal cargoes in any form . It is for this reason that Air Transportation is heavily regulated in almost every country of the world, Nigeria not being an exception.
This article will thus be looking at the main topics of :-
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– What Air Transport licenses (ATLs) and Airline Operations Permits (AOPs) mean for their holders.
– The Legal and Regulatory Framework governing these Aviation licenses.
– The requirements needed to procure these licenses.
– The post-licensing operation guidelines for holders of these licenses.
What is an Air Transport license and an Airline Operations Permit?
An Air Transport license basically entitles its holder to engage in the commercial business of transporting persons, personal belongings, baggage, goods or cargo via the means of an aircraft while an Airline Operations Permit gives its holder to engage in Airline Operations which basically involve the aspects of making planes fly on the day of operation and involves the aspects of :-
– Flight operations (dispatch, flight planning, flight watch, operational control, ground-to-air communications, integration with the crew, schedule & maintenance planning).
– Ground operations( optimal risk allocation, training, reward systems, determination of operational manpower requirements, checking, baggage handling, loading the plane with cargo, bags , fuel , catering, embarking & disembarking the aircraft)
– Maintenance operations.
What is the Regulatory Framework governing the granting and operation of an ATL and AOP?
Airline Operations Permits and Air Transportation licenses along with the companies that seek or secure these licenses are governed by the Nigerian Civil Aviation Act through and the Nigerian Civil Aviation Regulations through the Nigerian Civil Aviation Authority (NCAA) along with the Federal Airports Authority of Nigeria(FAAN).
What are the requirements for the grant of an Airline Operations Permit?
The requirements for this permit are :-
-An application for this type of license is to be made in writing to the Director-General of the NCAA & signed by a duly authorized representative (preferably a lawyer) of the applicant and should be submitted on or before a date not less than 6 months to the expected date of AOP utilization.
This application must contain:-
- 1.The name and address of the applicant.
- The type of services to be provided.
- The number and types of aircraft to be utilized.
- The proposed operational base of the applicant.
– 4 copies of the applicant company’s certificate of incorporation and MEMART (Memorandum & Articles of Association) as well as the Statutory forms showing the directors of the company and their particulars. At least 1 member of the board of directors must be an Aviation professional & the majority shareholding of such a company shall be held by Nigerians.
– A statement of the company’s share capital.
-4 copies of the Tax Clearance Certificates of the company and its directors (with original copies for sighting).
– 4 copies of the detailed business plan of the company indicating its vision, mission, market analysis and strategy, company’s ownership structure, personnel plan, fleet acquisition plan, financial plan including sources of finance, balance sheet, break-even analysis, pro forma income projections (profit and loss statements), cash flow analysis, proposed fares for passengers or cargo and other standard business plan requirements showing detailed road map of how the applicant’s strategy to provide efficient services in respect of safety, regularity, reliability and profitability of operations.
– A publication of a notice of the AOP application in 2 national daily newspapers. This publication should contain information in the application submitted to the NCAA.
– Evidence of the applicant’s financial solvency/ability to undertake the business. Applicants are expected to prove that they are solvent to run operations for a period of 3 months from the start of operations without resorting to any income from their operations.
– Duly completed application forms to be obtained from the NCAA.
– Duly completed Personal History Statement (PHS) forms & 2 passport photographs in respect of each of the shareholders of the company having more than 5% equity shareholding.
– Receipt of payment of a 500 Thousand Naira non-refundable processing fee payable to the NCAA.
– Evidence of adequate insurance cover for passengers, cargo and 3rd party liability.
– Publication in the official Government gazette by the NCAA in the process of carrying out the technical evaluation of the application. The cost implication of this publication will be borne by the applicant.
– A security clearance via the NCAA forwarding the applicant’s duly completed PHS forms and other relevant documents to the ministry responsible for aviation to seek security clearance from the presidency.
– The applicant will be required to liaise with the airport service providers or the FAAN regarding the approval of its home or operational base.
The following should be noted :
– Upon the receipt of an AOP grant, an annual utilization fee of 100 Thousand shall be paid to the NCAA.
– On receipt of an AOP application, the Director-General of the NCAA may request for additional information from the applicant as may be deemed necessary.
– The outcome of the technical evaluation of the application accompanied by an appropriate recommendation will be forwarded to the Air Transport Licensing Committee (ATLC) for consideration & approval to issue the AOP or otherwise as soon as the security clearance or consent is received from the ministry.
– The Director-General shall refuse to grant a permit if the applicant is not cleared by the State Security Service.
– An AOP grant not utilized at the expiration of its validity period shall not be renewed.
– AOP holders are also required to return to the NCAA monthly statistical returns on aircraft movements as well as cargo & passenger up-lift.
What are the requirements for the grant of an Air Transport Licence (ATL)?
The requirements for an ATL grant are :-
– An application to be made in writing to the Director-General of the NCAA & signed by a duly authorized representative of the applicant (preferably a lawyer).
This application must be submitted on or before a date not less than 6 months to the expected date of utilization of the ATL.
An ATL application must contain :-
a). The name and address of the applicant.
b). The type of air services to be provided.
c). The proposed operational base of the applicant.
d). Details of proposed routes to be operated where applicable.
e). The number and types of aircraft to be utilized.
f). Times and frequency of the services.
– 4 copies of the certificate of incorporation of the applicant company and its MEMART (Memorandum & Articles of Association).
– Statutory Corporate forms showing particulars of the applicant company’s directors. At least 1 member of the board of directors must be an Aviation professional in line with the Aviation Act. Also, the majority shareholding of the applicant company shall be held by Nigerians.
– 4 copies of the Tax Clearance Certificates of the company and its directors (originals should also be presented for sighting).
– 4 copies of the applicant company’s business plan.
– A publication of a notice of the ATL application in 2 national daily papers which should contain information on the application submitted to the NCAA.
– Evidence of the applicant’s financial solvency/ability to undertake the business. Applicants are expected to prove that they are financially solvent to run operations for a period of 3 months from the start of operations without resorting to any income from their operations.
– Duly completed application forms from the NCAA.
– Duly completed PHS forms and 2 passport photographs in respect of each of the shareholders of the company having more than 5% equity shareholding.
– Proof of payment of a non-refundable processing fee of 1 Million Naira to the NCAA.
– A publication in an official Government gazette with the costs to be borne by the applicant.
The following should also be noted regarding ATL applications :-
– No person shall operate an aircraft in Nigeria without a security clearance issued by the government upon the forwarding by the NCAA of PHS forms and other relevant documents to the ministry in charge of security clearances.
– The applicant will be required to liaise with the Airport Service providers or the FAAN regarding approval of its home or operational base.
– Upon the receipt of an ATL application, the Director-General of the NCAA may request for additional information from the applicant as deemed necessary.
– Upon the grant of an ATL, an annual utilization fee of 200 Thousand Naira shall be paid to the authority.
– The outcome of the technical evaluation of tht application followed by an appropriate recommendation will be forwarded to the ATLC for consideration and approval to issue a Licence subject to a received security clearance from the Ministry.
– The Director-General of the NCAA shall refuse to grant an ATL if the applicant is yet to be cleared by the State Security Service.
– Every Commercial Air Transportation service provider must provide adequate insurance covers for passengers, cargo and 3rd parties.
– The financial health of an Air Transport Company or Airline Operations company shall be monitored closely by the NCAA.
– Tariffs to be charged for the carriage of passengers and baggage shall be filed with the authority and the public duly notified before their introduction in respect of scheduled services. The Directorate of Air Transport Regulation, NCAA should be contacted further on this.
– ATL holders are also required to forward to the NCAA:-
- Monthly statistical returns on aircraft movements and passengers uplift.
- Details of flight schedules and changes thereof regarding frequencies & new destinations.
– An applicant wishing to operate regional and International scheduled services should obtain and seek further professional advice on the guidelines and requirements for designation as approved by the Honourable Minister .
– ATL grants that are not utilized at their expiration shall not be renewed.
What is the validity period of an AOP and ATL?
AOP grants are valid for 3 years while ATL grants are valid for 5; years.
What are the minimum share capital requirements for an AOP and ATL?
AOP grants require a minimum share capital of 500 Million Naira while for ATLs the minimum share capital requirements are :-
– Domestic operations – 500 Million Naira.
– Regional operations -1 Billion Naira.
– International operations – 2 Billion Naira.
What is the basic insurance cover requirement for both AOP and ATL holders?
The insurance policy required of both AOP and ATL holders must at minimum be able to pay a compensation of $100,000.00 (a Hundred Thousand US Dollars) per passenger in case of death or injury.
Conclusion :- It can be seen from the above write-up that seeking entry into the Aviation sector requires dependable professional guidance and representation at the pre-licensing, licensing and operations phase of operations. Further consultation with a lawyer is very necessary if you are seeking advice on how to register an aircraft in Nigeria or secure operational base approval from the FAAN, two other topics that are very important pre-operation requirements for intending Aviation Service providers but which are not the core focus topics of this article.