Russian Business Aviation Reaches a Crossroads in Its Growth Path

Russian Business Aviation Reaches a Crossroads in Its Growth Path is an AIN story by Vladimir Karnozov and Charles Alcock

September’s JetExpo show at Moscow’s Vnukovo Airport once again provided a fascinating snapshot of how the Russian business aviation market is continuing to develop. The overall impression from this eighth annual event is that, after a powerful growth surge, the market may be leveling off somewhat, but with every prospect of further expansion.

As with many other emerging business aviation markets, an unfriendly regulatory and fiscal environment continues to be a challenge for the industry. But on the positive side, more purpose-built infrastructure to support business aircraft operations in Russia is being put in place.

“We want the legislative base [regulating business aviation activities] to improve and our member companies to have a profitable growth,” said Alexander Kuleshov, chairman of the board at the Russian United Business Aviation Association (RUBAA). Speaking at the Business Aviation Forum in Moscow on the eve of this year’s JetExpo show, he said that growing numbers of Russian aircraft owners now want to import their assets into Russia legally, reversing a long-standing trend that has seen aircraft registered outside the country to avoid a complex web of administrative and fiscal hurdles. As of August this year, there were still only 50 business aircraft registered in Russia, but this represented a significant increase on the 30 shown on the register 12 months earlier.

Many more aircraft are registered overseas, mainly in Western Europe, where numerous wealthy Russians have homes. RUBAA says that it has solid information that at least 170 aircraft are owned by Russian citizens but based overseas. Wider estimates suggest that anywhere between 300 and 500 aircraft are now Russian-owned, but registered outside the country. Of these, it is estimated that around 100 are permanently, or for the most part, based outside Russia. But a larger number are based at Russian airports more or less regularly.

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