Canada and the United States are both able to meet International Civil Aviation Organization (“ICAO”) standards while taking different paths to safety. Below is an in-depth comparison of how Transport Canada Civil Aviation (“TCCA”) and the United States Federal Aviation Administration (“FAA”) regulate the design, engineering, manufacturing, and certification of civil aircraft and aerospace equipment.
Certification Roles
Both entities are considered a state-of-design authority under the Convention on International Civil Aviation (also known as the Chicago Convention) for issuing type certification and airworthiness directives with respect to aircraft and aeronautical products. Both entities have responsibility for ensuring aircraft and aerospace products meet their country's respective safety standards. More specifically, these entities are responsible for (i) airworthiness certificates for new aircraft, engines, and other regulated aviation components, (ii) supplemental certificates for significant modifications in aircraft, engines and component specifications, and (iii) production approval for manufacturers of new products.1
Statutory Basis
From a statutory standpoint, TCCA works under the Aeronautics Act2 and the Canadian Aviation Regulations (“CARs”), while the FAA works under Title 49 of the United States Code3, also known as the Federal Aviation Regulations (“FARs”).
With respect to procedure, TCCA is a contracts out compliance process which means that the TCCA certification program is enabled through professional approved representatives who act and issue compliance approval on its behalf. These representatives are mostly experts with extensive technical and engineering backgrounds. It shall be noted that all TCCA compliance decisions are kept confidential and not published.
In contrast, the FAA, through the Organisation Designation Authorisation (“ODA”) program gives manufacturers considerably more autonomy and ownership through a largely self-certification process4. Pursuant to the FAA compliance program, the compliance approval authority is partly delegated to external organizations and certain expert personnel who are responsible for ensuring compliance with FAA standards, while the FAA provides oversight and guidance. ODA holders can be authorized to perform various functions, including engineering approval, manufacturing inspections, and issuing airworthiness certificates, depending on the type of ODA held.
The Canadian and American regulators work closely together. Since 2015 and pursuant to the Canada-U.S. Bilateral Airworthiness Agreement, technical reciprocity of certifications is generally agreed and harmonized between TCCA and FAA. This way, aircraft and components certified in one country are deemed to be certified and compliant with the other country's laws. However, the agreement is not totally uniform in that not all technical certification and compliance are harmonized at this time and depending on the aircraft or product, additional validation may be required.5
Compliance Process
Canadian aircraft parts manufacturers who wish to export their products to the United States will need to fill TCCA's Form 24-0045 with respect to Export Airworthiness Certificates which requires applicants to confirm that all FAA unique airworthiness directives have been applied even if not required in Canada, mirroring the FAA's process.6
In the same spirit, airlines which operate aircraft flying in both jurisdictions will frequently develop dual flight-crew training to avoid having to develop separate operations manuals.
When it comes to structuring transactions involving aircraft acquisitions via financing or leasing, loan and lease contracts increasingly include a “Regulatory Change” covenant that assigns cost and downtime risk for potentially diverging requirements in the future (particularly surrounding environmental regulations; regulations related to certification, and possibly data regulations). Pursuant to such covenant, in the event of a regulatory change affecting the aircraft airworthiness, the parties will agree that no default shall be considered as occurring for a certain reasonable period of time during which the operator of the aircraft will have a certain amount of time to adapt the aircraft to the latest regulatory requirements.
Emerging Domains
Both regulators are under pressure to implement regulations for new technologies and accordingly work together in the development of new regulations for emerging technologies.
TCCA has published the Advisory Circular no. 500-020 outlining performance-based requirements for electric vertical take-off and landing aircraft, and the FAA is pursuing a combined “special class” type certification for very light airplanes so that such airplanes become eligible for standard airworthiness certificates.
With respect to unmanned aircraft systems and drones, Part IX of the CARs provides the rules of pilot licensing, and actually imposes a maximum of 25 kg weight for the operation of a drone beyond the visual line of sight (“BVLOS”) without possessing a certificate as a drone pilot, unless the pilot is operating under a Special Flight Operations Certificate issued by TCCA. Similarly, the FAA has very recently announced proposed new rules for BVLOS operation of unmanned aircraft. 7 These new rules, if and when implemented, will allow substantially more permissive BVLOS operation in the USA.
Separate Tracks, One Objective
While TCCA and FAA share the same overall safety goals, Canada's prevalent cold climate, remote geography, and policy decision to use a proactive aviation safety management system creates a slightly greater regulatory burden on regulated parties in Canada.
To avoid costly delays and rework, aerospace manufacturers and owners of aerospace type certificates in Canada should, as a starting point, review in detail the technical requirements of their proposed products, ideally before the product reaches the preliminary type certification board of TCCA or the FAA. Rigorous and methodical work at the design and pre-certification stage can prevent unnecessary red-tagging and late-stage development or product issues.
Fasken's national aviation team provides a wide range of legal services to Canadian and international companies operating in the aviation industry. Our lawyers have a deep understanding of the issues and intricacies of the aerospace industry, and we have a proven track record in handling regulatory matters, litigation, and complex aviation-related transactions. We will gladly help you manage and resolve your complex legal issues efficiently and effectively.
The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.
