China’s Efforts to Preserve Airworthiness While Opening their Market to Used Parts Could Serve as the Catalyst to the Digital Documentation Paradigm the Industry has Been Desiring

China’s Efforts to Preserve Airworthiness While Opening their Market to Used Parts Could Serve as the Catalyst to the Digital Documentation Paradigm the Industry has Been Desiring

China has been working with an international trade association [the Aircraft Fleet Recycling Association or AFRA] to create new traceability standards. These standards are exciting because they solve some current issues, but they also provide a foundation for modernizing aircraft parts traceability on a broader scale.

This process is also opening up China as a market for used rotable aircraft parts in a safe and efficient manner.

The Law of Used Parts

Normal bilateral agreements permit the import of new parts from each country, but they do not typically permit the import of used parts, including those maintained under the other country’s standards (unless there is a maintenance bilateral agreement between the nations).

For example, the bilateral agreements between China and the United States will allow the entry of parts manufactured under the production approvals of each country (such as complete aircraft and engines under production certificates, and aircraft parts produced under TSOA or PMA). In each case, where new products and parts are covered under the bilateral agreement, the exporting authority’s assertion of airworthiness is accepted by the importing authority. For aircraft parts manufactured in the United States, this typically means that the 8130-3 airworthiness approval tag for new parts is accepted in China to indicate that those new parts are airworthy and acceptable for installation on a Chinese-registered aircraft.

Used parts are typically handled under a different set of rules. The United States has entered into a limited number of maintenance bilateral agreements. Under those agreements, it is typical for countries to share oversight (the Canadian agreement is different, but we do not need to describe it in this column). For example, under the EU-US agreement, when a US-based repair station wants to apply for EASA-145 privileges, the application is made with the FAA, and the FAA performs the inspection on behalf of EASA. The FAA will report the application and the inspection results to EASA. Normally, the foreign certificate (EASA in this hypothetical) will bear the same ratings as the domestic certificate (the FAA certificate in this case). Once the EASA certificate is issued, the FAA will perform continuing oversight over the elements described in the Maintenance Annex Guidance on behalf of EASA. This streamlines the process and permits the governments to make efficient use of their resources.

Used parts also pose other legal problems because if they are deemed to be waste, then their international transfer can be regulated by international conventions like the Basel Convention. So, it is important that they be moved across borders pursuant to a bilateral agreement that recognizes their continued status as aircraft parts.

But the bilateral agreements typically do not permit used parts to cross borders under any sort of privileged status. In the absence of privileged status, there is no presumption of airworthiness related to those parts.

Historically, countries have allowed their certificated repair stations to accept used parts that meet appropriate standards and overhaul those parts to return them to an airworthy condition. But a change in Chinese law altered that norm.

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China’s Standards on Removed Parts

There was a concern in China that unapproved or counterfeit parts could enter the civil aviation system by being misrepresented as used parts in need of overhaul. They targeted alleged aircraft disassemblies as a potential source for introducing such unapproved or counterfeit parts. As a consequence, the Chinese government issued guidance that severely restricted the acceptance of parts that were removed in a disassembly operation.

The primary focus of the restrictions was to require that parts only be removed by trusted participants in the aviation system. As implemented, this meant that the parts had to be removed by CCAR-145 (Chinese) repair stations. Specifically, for aircraft disassemblies, the Civil Aviation Administration of China (CAAC) created a new rating for repair stations that would authorize the disassembly of aircraft. The philosophy is that such rated repair stations would have the authority to remove the parts and to add them to a database created by the Civil Aviation Maintenance Association of China (CAMAC). By establishing this structure, the CAAC established a means for confidently tracing these parts back to the aircraft from which they had been removed, based on database entries from trusted resources (CCAR 145 repair stations).

Note this system is currently limited under Chinese policy to only aircraft parts (not engine parts) and it is further limited to only parts bearing serial numbers (so the parts can be uniquely tracked and identified to their electronic records).

This created a mechanism for improving the traceability of these parts and providing the industry with a better level of confidence in the chain of commerce associated with these parts. The Chinese policy also imposed two levels of checks on this data. The data on a part matching the system criteria must be checked when the part is accepted by a CCAR-145 repair station for work (such as an overhaul). They must confirm that the part was removed properly. After the part is returned to an airworthy condition, it will be checked a second time — at the time of installation — to once again confirm the proper removal of the part in conformity with Chinese law.

One of the problems with this system is that the vast majority of aircraft disassemblies are happening outside of China. This means that China must reach out to the rest of the world in order to seek airworthy parts that have been removed with the intent for reuse.

How This Varies from International Law

China’s new policies are a departure from international law, and appear to be blazing a new trail in traceability. As an innovator, China has needed to seek out ways to ensure that their new systems can be effective in supporting safety.

Under international law, the country of registry dictates maintenance standards for an aircraft. So, if an aircraft is registered in China, then the aircraft must be maintained according to Chinese law. When an aircraft is no longer registered, countries have typically deemed that the unregistered asset is no longer an aircraft under their regulatory jurisdiction. This means that work on that asset is not “maintenance” subject to the jurisdiction of the prior registry country. When an aircraft is moved from one registry to another, the country that issues the new registration will assert its maintenance rules over the aircraft. But at the end-of-life of an aircraft, after it has been deregistered, there is no longer a country that can assert maintenance jurisdiction over the aircraft, so its disassembly has typically been outside of the scope of any maintenance regulation.

This creates a difficulty for China. First, they do not have a bilateral maintenance agreement with major trading partners like the United States. Second, even if they had such an agreement, the United States does not recognize work on deregistered assets as regulated maintenance (because such aircraft do not have US certificates of airworthiness, they are outside the scope of the Part 43 maintenance regulations). Therefore, the United States does not have disassembly ratings, so there is no corollary basis upon which for China to issue disassembly ratings to US-based repair stations. This is a problem that faces the Chinese system throughout the world.

In the absence of regulation, AFRA built a Best Management Practices (BMP) that provided a structure designed to support both airworthiness and environmental priorities. This AFRA BMP has become the dominant quality management system for companies that disassemble and/or recycle aircraft assets.

By focusing on the reintroduction of these parts back into the regulated system, and requiring the disassembly to meet certain conditions, China is blazing a new trail in used aircraft parts traceability. China recognized that the AFRA system added value (by protecting airworthiness at the time of disassembly). They also recognized that the AFRA system was the only global system providing a uniform foundation for both environmental and airworthiness safety related to aircraft and engine disassembly. As a consequence, the CAAC announced a partnership with AFRA wherein the CAAC would rely on the AFRA BMP Accreditation as a foundation permitting the CAAC to inspect facilities and issue CCAR-145 certificates with the limited disassembly ratings. This permits China to create a system of trusted partners around the world who are able to safely remove parts from aircraft and are empowered to upload parts data to a traceability database that confirms the proper removal of those parts.

This helps China to accept removed aircraft parts from around the world, with confidence that they were removed from the right sources (and that they are not unapproved parts being illicitly introduced into the market). But this program has the potential to have a more significant effect!

The ability to create a government-recognized database with a prominent commercial benefit (the ability to access the Chinese market) makes this database likely to be successful. As a successful source of traceability information, this puts the industry on the path toward digital documentation.

The aviation industry has been exploring digital documentation for decades. It was about 25 years ago that the industry gathered to create a standard for the digital exchange of aircraft parts airworthiness data (it became part of A4A’s “ATA Spec 2000,” which already had standards for the digital interchange of data). But the industry has been unable to turn this standard into a uniform industry practice. Recent events had highlighted the need to modernize aircraft parts documentation practices and the Chinese project may serve as the backbone of an international effort to implement a useful digital documentation mechanism.