Aircraft Purchase Escrow (UK)

Acting as a trusted neutral third party for the completion of an aircraft purchase transaction, we hold the aircraft papers and the deposit.
Aircraft Purchase Escrow (UK)
Specialist Escrow & Payment Services
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It is common for aircraft sale and purchase contracts to agree to make use of escrow agents as trusted, neutral third parties to hold aircraft papers and the all-important deposit during a transaction. To use an escrow adds additional transparency and security to the deal and the escrow agreement can be a powerful tool to ensure that all of the required closing matters are attended to - it can, for example, provide for certain amounts to be held in escrow post-completion pending agreed conditions.

How UK escrow companies assist aircraft buyers and sellers

There are a number of different layers to this:

No Conflicts of Interest

Parties will wish to ensure that the escrow agent has no affiliation or ties to the seller or the buyer, nor any of the brokers or lenders involved in the transaction. This need is to ensure impartiality in the case of ambiguity or conflict during the process.

Aircraft Purchase Process

Once the buyer and seller have agreed on the heads of terms for the Sale and Purchase Agreement (or "Bill of Sale"), the buyer will submit a Letter of Intent ("LOI") to the seller on those terms. Once accepted, the buyer is usually required to deposit money in escrow in contemplation of completion. This deposit confirms the buyer's commitment and secures the aircraft while the contract is being finalised.

Following the entering by the participants into the escrow agreement, the buyer and seller will deposit the necessary documentation (including the aircraft title, registration documents, Bill of Sale, maintenance records, purchase agreement and any inspection reports) with the escrow agent.

The aircraft buyer will usually inspect the aircraft while this deposit is safely held, in order to verify its compliance with the purchase agreement before the transfer of documents and funds.

Completion of the Aircraft Purchase & Release of the Aircraft Escrow

At completion on the terms of the agreement, the buyer will instruct the escrow company to release the money to the seller, and the seller will instruct the escrow provider to release and provide the aircraft ownership documents to the buyer, all as set out in the Bill of Sale.

The closing process includes signing the final paperwork, transferring the title and completing any other required steps - the escrow agent can assist the parties' lawyers with all of these elements.

Post-Completion Matters

Once the transaction has completed and the aircraft has changed hands, the escrow agent will, in accordance with the escrow agreement, need to provide a closing statement detailing the final amounts involved in the sale and often provide digital copies of any documents in a data room.

Choosing your Aircraft Escrow Agent

There are a number of considerations when it comes to choosing the right escrow company to handle your closing arrangements; including their experience with escrow, their location, their financial and regulatory arrangements and how helpful they are being just a few of these.

Where are they based?

Most parties will prefer an escrow agent who is operating on their timezone and who has a good reputation and experience in the type and scale of transaction they are carrying out.

For US-US sales, it is normal for the escrow agent to also be based in the USA. For European sales, however, London, UK remains a popular jurisdiction for escrow agents, both because of its well-established legal and financial systems and because of its helpful geographic position and time-zone when it comes to the all-important closing.

Are they regulated?

Our company is also regulated by the Financial Conduct Authority for our payment service provision, so we are well-accustomed to the compliance and professional obligations we are required to adhere to. Others may not be regulated, per se, but will have a registration with the relevant regulators to affirm their compliance and anti-money laundering systems.

Where are your funds kept?

The underlying bank and any credit risk they pose will be of utmost importance to the contracting parties. We use only tier 1 banks, and for our GBP transactions we only store funds at the Bank of England.

Why use an aircraft escrow company?

Like all third-party escrow processes, the clear primary considerations are always security, transparency and independence. We add trust to aircraft transactions.

Some particular benefits of using an aircraft escrow are:

  • The escrow agent commits to repay any lenders on completion, ensuring the release of any liens, before it transfers proceeds to the seller;
  • Escrow agents are entirely independent of either side's legal advisors;
  • Escrow agents can hold documents (such as title and aircraft registration documents and finance documents) as well as funds;
  • Only one Bill of Sale can be in play at any one time in respect of the transaction; and
  • We carry out detailed anti-money laundering, compliance and source of funds/wealth checks, ensuring that the funds are cleared and ready for completion in good time.

Do I need to employ an escrow for my next purchase?

In our view, of course. Your legal representatives will be able to advise not only on the merits but also on the best people to speak with. They will have experience of negotiating escrow agreements as well. We would be happy to quote for your contemplated arrangements as well - simply request a quote here.

White-Glove Service

Your named account manager can help you manage your accounts at any time, by email, phone or WhatsApp.

High-Speed Account Opening

We can open escrow accounts same-day if all of the required compliance information can be provided.

Ultra-Secure Deposits

We deposit all pound sterling sums at the Bank of England, offering the lowest-risk escrow service in the United Kingdom.

Any duration, any value

We can hold funds for as little as a few hours, for many years, or even longer depending on your specific requirements.

Request a Quote

We'll be happy to provide you with a free, no-obligation quote. Generally, these get turned around in less than 24 hours. In the meantime, if you can't wait, why not Book a Video Call to speak with one of our team?