The FAA really is trying to make it easier for industry to use safe aircraft parts. I have been writing blog articles about the FAA’s problems with the 8130-3 (Airworthiness Approval Tag), but relatively little press has been given to the FAA’s efforts to make the 8130-3 tags better. A recent policy memo from the FAA actually removes unnecessary distinctions and makes it easier to use the 8130-3 tag in parts transactions.
On June 28 the FAA issued a policy memo (AIR100- 16-110-PM04) that forbade parties from stating ‘domestic shipment only’ or “not an export approval” on the 8130-3 tag: “This memorandum provides clarification on the use of ‘domestic shipment only’ and ‘not an export approval’ in block 12 of FAA Form 8130-3 (hereafter, tags). Inspectors, designees, delegated organizations, and persons authorized in accordance with a production approval holder’s approved quality system to issue tags are directed to not add ‘domestic shipment only’ and ‘not an export approval’ to block 12.”
This export-specific language tended to impede subsequent exports. Many people mistakenly thought that this language was meant to prevent a subsequent export. The FAA has removed the export-specific language because it found that the language impeded commerce without adding any safety value.
Use of this sort of export-specific language ignored the original purpose of the‘domestictag.’ Itwas originally meant to create a kludge that made 8130- 3 tags available to exporters – at a time when the regulations limited access to the traditional export tag. It was called a ‘domestic’ tag because it only certified compliance to domestic US standards, and not to any special import requirements of an importing nation.
Years ago, exporters (who were not the manufacturer) were unable to obtain an export tag for parts. The reason for this began in 1963, when the FAA published a Notice of Proposed Rulemaking (NPRM) to establish the rules for export airworthiness approvals (Subpart L of 14 C.F.R. Part 21). They classified the world of aircraft assets into three classes:
(1) A Class I product is a complete aircraft, aircraft engine, or propeller, which:
(i) Has been type certificated in accordance with the applicable Federal Aviation Regulations and for which Federal Aviation Specifications or type certificate data sheets have been issued;
(ii) Is identical to a type certificated product specified in paragraph (b)(1)(i) of this section in all respects except as is otherwise acceptable to the civil aviation authority of the importing state.
(2) A Class II product is a major component of a Class I product (e.g., wings, fuselages, empennage assemblies, landing gears, power transmissions, control surfaces, etc), the failure of which would jeopardize
the safety of a Class I product; or any part, material,
or appliance, approved and manufactured under the Technical Standard Order (TSO) system in the ‘C’ series.
(3) A Class III product is any part or component which is not a Class I or Class II product and includes standard parts, i.e., those designated as AN, NAS, SAE, etc.
This three-part distinction can be found today in older versions of the Code of Federal Regulations. But this distinction no longer exists in the modern regulations.
The original 1963 NPRM (Nnotice of Propose Rule Making) suggested that export airworthiness approvals would be available for Class I and Class II products. It explained that export airworthiness approvals would not be necessary for Class III products, and that exporters could self-certify airworthiness with respect to those units. This dramatically limited the impact of the proposed rule, because most articles fell into class III.
During the comment period for this new rule, a manufacturer wrote to the FAA and said that it could foresee a possible need in the future to apply for Class III export airworthiness approvals for its own articles. The stated purpose of the rule was to facilitate trade, so when the Final Rule was published in 1964, the FAA added a clause stating that manufacturers could also apply for Class III export airworthiness approvals in order to meet the request of the commenter. No one was askingforthesetagsforpiece-parts,sotherewasno objection to the additional permission.
Years later, as the export 8130-3 tag became more popular in international commerce, and the FAA signed international agreements promising to provide the 8130-3 tags with aircraft part exports, the aircraft parts distribution community began to see a need for the tags to facilitate their trade. But the regulatory language only permitted manufacturers to apply for the export 8130-3 tag for these ‘class III’ parts. So the ‘domestic tag’ was born in order to provide a tag that distributors could seek. The ‘domestic tag’ only certified compliance to US domestic standards – it did not certify compliance to any special import standards of any importing nation (it was up to the exporter to address such conditions, and at the time foreign trading partners were happy to take this tag because they generally did not have special import requirements for individual parts).
The domestic tag also quickly became popular among domestic users in the US (notably, Northwest Airlines in the late 1990s was an early proponent of the use of the 8130-3 tag for domestic transactions).
For a short time, this limiting language (‘domestic shipment only’) actually appeared in an earlier version of the FAA’s internal orders. I sought clarification from FAA management at the time. I pointed out that the original purpose was to facilitate export for distributors, and FAA management agreed that this language was inappropriate. FAA management confirmed that the inclusion of that language had been a mistake, because it contradicted the original purpose of the domestic tag.
In order to discern the reason for this errant language, FAA management called in the employee who was responsible for the text of the Order and asked “why did you include this language?” The FAA employee’s reply was to shrug his shoulders and say “I don’t know … it seemed like a good idea at the time.” The language was removed from the next revision of the FAA’s orders, but it continued to find its way into 8130-3 tags, nonetheless.
The Problem with Export Language
The reasons that export-specific language has fallen out of favor at the FAA are many, but one of the most salient reasons is borne out of the recurring stories of transaction interruptus caused by the tag.
Imagine this – you are selling an aircraft part from a warehouse in Singapore to an airline in China. The part bears an 8130-3 tag that was issued at the manufacturer’s facility. The tag was issued by the FAA. There is every reason to believe that the part is perfectly airworthy and that it is acceptable in China. But the part is rejected by the Chinese air carrier.
Why was the part rejected? Because the tag said that it was valid for export to Singapore (the first destination) and did not mention China (which was an unknown destination at the time the tag was issued). The failure to mention China becomes the invalidating factor, even though the part is clearly airworthy.
The European Union has overcome this issue by only having one EASA Form One tag (this is the European corollary to the FAA’s 8130-3 tag); they do not distinguish on their EASA Form One tags between export tags and domestic tags. This prevents unnecessary impediments to trade.
Over the years, the FAA has recognized that this export-specific language impeded export transactions without offering any redeeming value. The policy memo closes the loop on this language by forbidding it, so that the United States will no longer undermine its own commercial interests (at least not on this particular point).
The recent policy memo – forbidding the use of the ‘export’ terminology on the 8130-3 tag – is also consistent with the discussions that current FAA management have been having about the future of the tag. In the past the 8130-3 tag has been treated almost like a magical tag. FAA headquarters wants to change this. They’ve said that they want the tag to be more like a manufacturer’s certificate of conformity. This would be more consistent with the way that documentation has been treated in other jurisdictions, like the European Union.
Another step that the FAA has taken that is consistent with this philosophy is to permit US manufacturers (FAA production approval holders) to issue 8130-3 tags under their own authority, rather than relying on FAA designees to issue the tags.
Exporters who encounter parties who want to print ‘domestic shipment only’ or ‘not an export approval’ in block 12 of FAA Form 8130-3, should draw the issuing party’s attention to this FAA policy memo and to the changes in FAA 8130-3 tag philosophy.