Hogan Lovells US LLP Columbia Square 555 Thirteenth Street, NW Washington, DC 20004 T +1 202 637 6934 F +1 202 637 5910

December 17, 2018

U.S. Department of Transportation Docket Operations West Building Ground Floor, Room W12-140 1200 New Jersey Avenue, SE Washington, DC 20590

Subject: Cirrus Design Corporation d/b/a Cirrus Aircraft Petition for Exemption to 14 CFR §§ 47.65 and 47.69(b)

Dear Sir or Madam:

Pursuant to 14 C.F.R. Part 11, Cirrus Design Corporation d/b/a Cirrus Aircraft (“Cirrus”), hereby applies for a Grant of Exemption from 14 C.F.R. §§ 47.65 and 47.69(b). If granted, the requested relief would allow Cirrus to obtain a Dealer’s Aircraft Registration Certificate, AC Form 8050-6, without meeting the United States citizenship requirements, and permit Cirrus to conduct limited flights outside of the United States under its Dealer Certificate for demonstration, sales and marketing purposes.

The requested exemptions in this petition are not new or novel to the FAA. The FAA has issued grants of exemption from 14 C.F.R. §§ 47.65 and 47.69(b) in circumstances similar in all material respects to those presented in this petition, and therefore the requested relief would not set a precedent. Moreover, any delay in acting on this petition would be detrimental to Cirrus. Accordingly, Cirrus submits that good cause exists for not publishing a summary of the petition in the Federal Register.

If you have any questions as you review these documents please do not hesitate to contact me at 202-637-8644 or [email protected].

Best Regards.

Sincerely,

E. Tazewell Ellett Hogan Lovells US LLP Counsel for Cirrus Design Corporation d/b/a Cirrus Aircraft

Petition of Cirrus Design Corp. Page 1 of 12

BEFORE THE FEDERAL AVIATION ADMINISTRATION ______

Cirrus Design Corporation d/b/a Cirrus Aircraft Docket No. FAA-2018-_____

Petitioner.

CIRRUS DESIGN CORPORATION d/b/a CIRRUS AIRCRAFT PETITION FOR EXEMPTION FROM 14 C.F.R. §§ 47.65 and 47.69(b)

E. Tazewell Ellett Matthew Clark Hogan Lovells US LLP 555 13th Street, N.W. Washington, DC 20004 Phone: 202-637-8644 Fax: 202-637-5910 [email protected] [email protected]

Counsel for Cirrus Design Corporation d/b/a Cirrus Aircraft

DATE: December 17, 2018

Petition of Cirrus Design Corp. Page 2 of 12

I. INTRODUCTION AND BACKGROUND OF PETITIONER

Cirrus Design Corporation d/b/a Cirrus Aircraft (“Cirrus”) is a Wisconsin corporation formed in

1984 with its headquarters in Duluth, Minnesota. Cirrus was created by two brothers, Dale and Alan

Klapmeier, in their parents’ barn in Baraboo, Wisconsin. During the 1990s, Cirrus designed, developed, and put into production the SR20, which was the first general aviation aircraft to incorporate an airframe parachute among many other safety firsts and enhancements, and was followed shortly thereafter by the groundbreaking SR22. Since 2004, Cirrus has been manufacturing

(in Duluth) the bestselling single engine aircraft in the world, and Cirrus has delivered (to date) over

7,000 SR-series airplanes to its customers.

As noted above, among Cirrus’ most successful innovations is the Cirrus Airframe Parachute

System (“CAPS”), the country’s first (and still only) factory-installed whole-airframe parachute system on a FAA-certified aircraft. The CAPS parachute system has saved over 163 lives and counting over the past 17 years. Because of its reputation for safety, quality, and innovation, Cirrus is consistently lauded by regional and national media and is the subject of regular and significant media coverage.

In 2010, the FAA granted Cirrus a type certificate for the SR22T, but the worldwide recession had a significant impact on the financial stability of light aircraft manufacturers like Cirrus.

Importantly, in 2011, China Aviation Industry General Aircraft Co. Ltd. (“CAIGA”) purchased Cirrus

Industries, Inc. in a well-publicized transaction in the general aviation industry.1 This investment from

1 In terms of the corporate structure of the Cirrus entities, Cirrus Design Corporation, a Wisconsin corporation, is a wholly-owned subsidiary of Cirrus Industries, Inc., a Delaware corporation, which in turn (as of 2011) is a wholly- owned subsidiary of CAIGA (US) Co. Ltd., a private limited company established and existing under the laws of the State of Delaware, which in turn is a wholly-owned subsidiary of CAIGA Co. Ltd., a private limited company established and existing under the laws of the State of Delaware, which in turn is a wholly-owned subsidiary of China Aviation Industry General Aircraft Co., Ltd., a private limited company established and existing under the laws of China.

Petition of Cirrus Design Corp. Page 3 of 12

CAIGA allowed Cirrus the necessary financial resources to weather a difficult market period and fund its Vision Jet program in Duluth.

In 2016, Cirrus received an FAA type certificate for, and began producing, its Vision Jet aircraft, the world’s first single-engine personal jet. – a very light 7 passenger jet. Consistent with

Cirrus’ unwavering commitment to safety and innovation, the Vision Jet also implemented the CAPS safety system for the aircraft. It would be an understatement to say that the aviation community took notice of the Vision Jet. In fact, for its visionary accomplishment in developing the world’s first personal jet and one with a whole-airframe parachute system, Cirrus was awarded the prestigious

Collier Trophy in April 2018. The Collier trophy is awarded annually “for the greatest achievement in aeronautics or astronautics in America, with respect to improving the performance, efficiency, and safety in air or space vehicles, the value of which has been thoroughly demonstrated by actual use during the proceeding year.” To date, Cirrus has delivered over 88 Vision Jets to the market.

Cirrus currently employs over 1,400 employees in the United States. In addition to the manufacturing plant and company headquarters in Duluth, Minnesota (where over 1,000 employees are currently employed), an additional company manufacturing facility, which produces the composite components for the Cirrus’ aircraft, is located in Grand Forks, North Dakota. In January

2017, Cirrus opened its new Vision Center customer experience campus in Knoxville, Tennessee at the McGhee Tyson Airport. The facility focuses on all customer interactions, including training, maintenance and repair, personalization and deliveries for the Vision Jet and SR-series.

To facilitate Cirrus’ operations, and to eliminate delays/inefficiencies associated with the need to obtain a certificate of registration for each individual aircraft produced at Cirrus’ main manufacturing facility in Duluth, Cirrus wishes to obtain a Dealer's Aircraft Registration Certificate.

Cirrus first applied for a Dealer’s Aircraft Registration Certificate in 2002 and has maintained a

Dealer’s Aircraft Registration Certificate since that date. In 2011, an upstream corporate owner of

Cirrus was acquired by CAIGA, a Chinese entity. Cirrus’ current Dealer’s Aircraft Registration

Certificate was issued by the FAA on April 7, 2018 and is set to expire on April 6, 2019.

Petition of Cirrus Design Corp. Page 4 of 12

While Cirrus is a Wisconsin corporation with an established place of business in the United

States and is substantially engaged in manufacturing and/or selling aircraft, Cirrus is now concerned that it may not satisfy the technical definition of “a citizen” of the U.S under 49 U.S.C. § 40102

(a)(15) because of the company’s upstream ownership. Accordingly, in an abundance of caution,

Cirrus respectfully requests an exemption from the citizenship requirement in 14 C.F.R. § 47.65 to be eligible for a Dealer's Aircraft Registration Certificate, AC Form 8050-6.

If granted an exemption from the citizenship requirement in 14 C.F.R. § 47.65, Cirrus additionally desires to conduct limited flights outside the U.S. under its Dealer's Aircraft Registration

Certificate for the purpose of demonstrating and selling its aircraft and marketing its aircraft to international customers. Cirrus therefore requests an exemption from 14 C.F.R. § 47.69(b), in order to enable it to conduct international flights under its Dealer’s Aircraft Registration Certificate for demonstration, sales, and marketing purposes.

II. INFORMATION REQUIRED BY 14 C.F.R. § 11.81 TO SUPPORT A PETITION FOR EXEMPTION

As required by 14 C.F.R. § 11.81, Cirrus provides the following information in support of this

Petition:

(a) Contact information:

Name: Cirrus submits this Petition for Exemption through counsel, E. Tazewell Ellett and Matthew Clark

Mailing address: E. Tazewell Ellett Counsel for Cirrus Design Corporation Hogan Lovells US LLP 555 13th Street, NW Washington, DC 20004

Telephone number: 202-637-8644 (Ellett) 703-610-6154 (Clark)

Facsimile number: 202-637-5910

E-mail addresses: [email protected] [email protected]

Petition of Cirrus Design Corp. Page 5 of 12

(b) The specific sections of 14 CFR from which an exemption is sought:

14 C.F.R. § 47.65 Eligibility and 14 C.F.R. § 47.69(b) Limitations.

(c) The extent of relief sought and the reason relief is sought:

14 C.F.R. § 47.65 “Eligibility”

Cirrus seeks an exemption from 14 C.F.R. § 47.65 to the extent necessary to allow Cirrus to obtain a Dealer’s Aircraft Registration Certificate without being a U.S. citizen, as defined by 49

U.S.C. 40102(a)(15).2 Cirrus does not seek an exemption from the requirement in 14 C.F.R. § 47.65 that an applicant for a Dealer's Aircraft Registration Certificate have an established place of business in the U.S. and be substantially engaged in manufacturing or selling aircraft.

The reason for the requested relief from 14 C.F.R. § 47.65 is to eliminate the administrative burden for Cirrus to obtain a separate certificate of registration for each individual aircraft assembly.

The granting of this petition also would eliminate the administrative burden on the FAA to process registration applications for each individual aircraft as it is assembled.

Without an exemption from 14 C.F.R. § 47.65, each aircraft would have to be initially registered by Cirrus pursuant to a process that allows registration without the applicant being a U.S. citizen, and thereafter subsequently registered again by the customer after delivery of the aircraft.

These are the exact types of problems and administrative burdens that the FAA sought to remedy when it created the Dealer’s Aircraft Registration Certificate.

Without an exemption from the U.S. citizenship requirement, Cirrus may not be eligible for a

Dealer’s Aircraft Registration Certificate. Without a Dealer’s Aircraft Registration Certificate, each aircraft assembled and sold by Cirrus will need to be operated under a separate certificate of registration issued to Cirrus for a period of a few days to a couple weeks, after which, the entire registration process would have to be repeated at the time of customer delivery. If Cirrus obtains a

2 In 1980, the FAA revised the requirement for aircraft registrations other than for a dealer registration to permit resident aliens and eligible non-citizen corporations to register aircraft in the U.S. However, the citizenship requirement for dealer certificates was not revised at that time.

Petition of Cirrus Design Corp. Page 6 of 12

Dealer’s Aircraft Registration Certificate, the first registration would not be necessary, and this would save the FAA the burden of processing dozens of extra registration applications a year.

14 C.F.R. § 47.69(b) “Limitations”

Under 14 C.F.R. § 47.69(b), a Dealer’s Aircraft Registration Certificate is valid only in connection with use of aircraft within the U.S., except when used to deliver to a foreign purchaser an aircraft displaying a temporary registration number and carrying an airworthiness certificate on which that number is written. Cirrus seeks an exemption from 14 C.F.R. § 47.69(b) to the extent necessary to allow Cirrus to conduct limited flights outside of the U.S. under a Dealer’s Aircraft Registration

Certificate, for demonstration, sales, and marketing purposes.

The reason for the requested relief is that the aircraft manufactured by Cirrus will be used by, and marketed to, operators around the world. As a result, Cirrus will sometimes be called upon to perform international demonstration flights in order to display the capabilities of the aircraft to prospective customers prior to sale. While most of Cirrus’ international demonstration aircraft are owned by third-party sales agents, Cirrus does at times have one or more Cirrus-owned demonstration aircraft stationed overseas, and those aircraft will be changed out for new ones each model year. In order for Cirrus to be able to operate aircraft outside of the U.S. for these purposes under a Dealer’s Aircraft Registration Certificate, an exemption from 14 C.F.R. § 47.69(b) is necessary.

(d) The reasons why granting your request would be in the public interest; that is, how it would benefit the public as a whole;

Granting this petition for exemption will promote and serve the public interest because:

 It will benefit the FAA by reducing the number of applications for registration processed

and certificates issued by the FAA. The elimination of this administrative cost on both

Cirrus and the FAA is in the public interest.

 Denial of this petition would increase the amount of time that an otherwise completed

aircraft would be parked awaiting initial registration. The additional financial cost of

Petition of Cirrus Design Corp. Page 7 of 12

having an otherwise productive asset out of service, with no corresponding benefit in

safety, is not in the public interest.

 The Cirrus manufacturing plant in Duluth, Minnesota currently employs approximately

1,000 employees in the region – which, taking into account the beneficial economic

multiplier effect, provides a significant economic benefit to both the Minnesota

community and the U.S.

 If granted, the exemption will expedite the entry into service of superior piston and jet

categories of aircraft, including, for example, the world’s best-selling general aviation

airplane—the SR22. Today, Cirrus continues to be the only company to include a whole

airframe parachute (the Cirrus Airframe Parachute System or “CAPS”) as standard

equipment on all certified aircraft models, which enhances general aviation safety and

has been credited with saving 163 lives.

(e) The reasons why granting the exemption would not adversely affect safety, or how the exemption would provide a level of safety at least equal to that provided by the rule from which you seek the exemption;

The FAA has issued grants of exemption in circumstances similar in all material respects to those presented in this petition. In each of these grants of exemption, the FAA determined that the relief granted would not adversely affect safety and was in the public interest.

The FAA has issued the following exemptions solely for the U.S. citizenship requirement in §

47.65 in circumstances where aircraft manufacturers, sellers, or dealers could satisfy all of the other requirements of § 47.65, as is the case here:

 Exemption No. 9673 issued to Eclipse Aviation Corporation (Docket No. FAA- 2008-0138)  Exemption No. 9147 issued to Hawker Beechcraft Corporation (Docket No. FAA- 2007-27749)  Exemption No. 10115 issued to Piper Aircraft, Inc. (Docket No. FAA-2010-0749)

Petition of Cirrus Design Corp. Page 8 of 12

The FAA has issued the following exemptions solely for § 47.69(b) to allow dealers to perform international flights for demonstration and marketing purposes under a Dealer’s Aircraft

Registration Certificate:

 The FAA has granted Raytheon (previously Beech Aircraft Corporation) several exemptions from § 47.69(b) (Exemption Nos. 5125, 5125A, 5125B, 5125C, 6758, and 7241)  Exemption No. 9510 issued to Hawker Beechcraft Corporation (Docket No. FAA- 2007-28247)  Exemption No. 9682 issued to The Boeing Company (Docket No. FAA-2002- 11942)  Exemption No. 9682A issued to The Boeing Company (Docket No. FAA-2002- 11942)

Finally, the FAA has issued the following exemptions covering both §§ 46.65 and 47.69(b) in circumstances similar in all material respects to this petition for exemption:

 Exemption No. 17733 issued to Honda Aviation Service Company, Inc. (Docket No. FAA- 2017-1186)  Exemption No. 10399 issued to Embraer Executive Aircraft, Inc. (Docket No. FAA-2011-1249)  Exemption No. 5315 issued to Falcon Jet Corporation (Docket No. 26440)  Exemption No. 5315B issued to Dassault Falcon Jet Corporation (Docket No. 26440)  Exemption No. 5315C issued to Dassault Falcon Jet Corporation (Docket No. 26440)  Exemption No. 5315D issued to Dassault Falcon Jet Corporation (Docket No. FAA-2001-11043)  Exemption No. 9292 issued to Dassault Falcon Jet Corporation (Docket No. FAA-2001-11043)  Exemption No. 9292A issued to Dassault Falcon Jet Corporation (Docket No. FAA-2001-11043)  Exemption No. 9292B issued to Dassault Falcon Jet Corporation (Docket No. FAA-2001-11043)  Exemption No. 9292C issued to Dassault Falcon Jet Corporation (Docket No. FAA-2001-11043)

In granting each of the above-referenced exemptions, the FAA determined that allowing a

U.S. corporation like Cirrus with foreign ownership to utilize the administrative benefits of a Dealer’s

Aircraft Registration Certificate, and also allowing them to operate aircraft for limited international flights under that Certificate, does not directly or indirectly involve safety related matters. See e.g.,

Grant of Exemption No. 5315 issued to Falcon Jet Corporation: “The exemptions [from §§ 47.65 and

Petition of Cirrus Design Corp. Page 9 of 12

47.69(b)] will not affect the level of safety currently required by the FAA’s rules and regulations since the relief requested does not directly nor indirectly involve safety related matters.” As recognized by the FAA in granting prior exemptions from §§ 47.65 and 47.69(b), safety will not be jeopardized because the same requirements for airworthiness, pilot qualification and training, and operations are applicable to non-U.S. citizen dealers and U.S. citizen dealers alike. See Id.

(f) A summary for publication in the Federal Register, including the rule from which exemption is sought and a brief description of the nature of the exemption sought:

Cirrus proposes that the FAA use the following as the summary:

Docket No.: FAA-2018-______

Petitioner: Cirrus Design Corp.

Section of the Regulation Affected: 14 CFR §§ 47.65 47.69(b)

Description of Relief Sought: Petitioner seeks an exemption to permit it to obtain a Dealer’s Aircraft Registration Certificate, AC Form 8050-6, without meeting the United States citizenship requirements, and to permit Petitioner to conduct limited flights outside of the United States under the Dealer’s Aircraft Registration Certificate.

(g) If you want to exercise the privileges of your exemption outside the United States, the reason why you need to do so.

As stated above, Cirrus desires to periodically fly aircraft using its Dealer's Aircraft

Registration Certificate outside the U.S. for demonstration, sales, and marketing. With regard to the requested relief from § 47.69(b), the FAA previously has determined that “the use of a U.S. Dealer's

Aircraft Registration Certificate outside the U.S. is consistent with the registration standards of the

International Civil Aviation Organization.”3 For this reason, the granting of this petition would not create a noncompliance with the standards of Annexes 7 and 8 of the Convention on International

Civil Aviation, and therefore the FAA would not need to file a “difference” with the International Civil

Aviation Organization.

3 Exemption No. 9682 issued to The Boeing Company (Docket No. FAA-2002-11942).

Petition of Cirrus Design Corp. Page 10 of 12

Cirrus will agree to conduct international flights under the requested exemption in accordance with the conditions imposed on petitioners in prior exemptions granting relief from the requirements of § 47.69(b)4, including the conditions that: (1) the aircraft will be owned by Cirrus; (2) the aircraft will have a temporary or assigned registration number properly affixed; (3) when an aircraft does not have a standard or transport airworthiness certificate, Cirrus will obtain host country or countries approval beforehand; and (4) Cirrus will maintain records of each international flight for one year after the aircraft returns to the U.S., with the registration number and MSN, dates of departure from and return to the U.S., and a general overseas itinerary. In addition, Cirrus will carry a copy of the exemption in each aircraft operated outside the U.S.

III. REQUEST TO FOREGO PUBLICATION IN THE FEDERAL REGISTER

The FAA previously has granted exemptions to §§ 47.65 and 47.69(b) in circumstances that are similar in all material respects to this petition for exemption, and no new precedent would be set by granting the requested relief. Cirrus currently is in full aircraft production, and Cirrus intends to obtain and use its Dealer’s Aircraft Registration Certificate immediately upon approval of this exemption request. Any delay in processing this petition for exemption to allow for Federal Register publication would cause a delay, and force production airplanes to continue to be individually registered two times: first, prior to the production flight test, and second, prior to delivery to the customer. Any delay in the ability of Cirrus to utilize a Dealer’s Aircraft Registration Certificate, and any need to continue to register twice each aircraft produced, would be very costly and detrimental to Cirrus. For these reasons, Cirrus respectfully requests that the FAA forgo publication of this petition for exemption in the Federal Register and grant the requested exemption on an expedited basis.

4 See Exemption No. 5315 issued to Falcon Jet Corporation (Docket No. 26440) and Exemption No. 9292B issued to Dassault Falcon Jet Corporation (Docket No. FAA-2001-11043).

Petition of Cirrus Design Corp. Page 11 of 12

IV. CONCLUSION

In consideration of the foregoing, Cirrus requests:

a. an exemption from 14 CFR § 47.65 to the extent necessary to obtain a Dealer's Aircraft

Registration Certificate without meeting U.S. citizenship requirements; and

b. an exemption from 14 CFR § 47.69(b) to the extent necessary to permit the use of the

issued Dealer's Aircraft Registration Certificate outside the U.S. for aircraft operations

demonstrating, selling, and marketing aircraft produced by Cirrus.

As demonstrated above, the exemptions requested by Cirrus are consistent with exemptions the FAA has issued in the past to other corporations, no new precedent would be set by granting the requested relief, granting the requested relief would not adversely affect safety, and granting the requested relief is in the public interest. For all these reasons, Cirrus respectfully requests that its petition for exemption be granted without delay.

If you have any questions or need and additional information to support Cirrus’ requested relief, please do not hesitate to contact the Cirrus contacts listed above.

Respectfully submitted,

E. Tazewell Ellett Matthew Clark Hogan Lovells U.S. LLP

Counsel for Cirrus Design Corporation d/b/a Cirrus Aircraft

Petition of Cirrus Design Corp. Page 12 of 12