Forget Holding Out – Operational Control is More Important

Ask any commercial pilot applicant about whether a flight is legal, and chances are the first thing they’ll bring up is “holding out.” While that’s important, it isn’t the foundation. The real cornerstone of commercial flying is operational control (OpCon) — who has the authority over starting, conducting, and ending a flight. Most confusion about legal vs illegal operations isn’t really about holding out; it’s about not understanding who actually has OpCon.

What Is Operational Control?

14 CFR 1.1: “Operational control—with respect to a flight, means the exercise of authority over initiating, conducting or terminating a flight.”

Sounds pretty simple, right? Unfortunately, like a lot of other things in aviation, it is more complicated than it sounds. Although the definition is short and to the point, actually determining who has OpCon takes a bit more time.

Why It Matters

Operational control is the cornerstone of any flight operation. Who has OpCon tells us who is ultimately responsible for conducting any flight in a safe and legal manner. Every single flight has a person or entity that is exercising OpCon. Sometimes that person is the pilot in command (PIC), but often, especially in commercial operations, it is a person or entity, separate from the PIC that employs the PIC.

Operational control as a practice becomes critical only when persons or property are being transported. A common area of confusion for flight instructors and new pilots is trying to determine who has OpCon at their flight school. In reality, the school typically maintains many elements of OpCon while the CFI/PIC maintains other elements. For argument’s sake, the flight school is usually retaining OpCon, with the CFI acting as their agent. Again, for legitimate training flights, this distinction isn’t very important. But once transportation enters the equation, knowing exactly who holds OpCon—and ensuring they’re legally authorized to exercise it—becomes essential.

Before I descend further into something that sounds like legalistic mumbo jumbo, let’s define some terms here.

Key Definitions

1. Part 91 Operation: This type of flight operation is a personal flight where no compensation of any kind is being received by the person or entity exercising OpCon. Example: An aircraft owner conducts a flight with their immediate family on board to a vacation destination. The owner could fly the aircraft themselves or pay a professional pilot to fly the aircraft. Even if a professional pilot is paid to act as PIC, the OpCon is retained by the aircraft owner. This is commonly mislabeled as Private Carriage; however, Private Carriage is a type of 119 commercial operation with an unfortunately confusing label.

2. Part 135 Operation (Common Carriage): This type of flight operation is authorized under Part 119 and is a type of Air Carrier that operates for compensation. Example: Acme Aero is a Part 135 charter company flying a Beechcraft King Air. A customer contacts them after seeing an advertisement and asks to be flown to a vacation destination. Acme Aero agrees to conduct the flight and sends the customer an invoice for the trip. The price of this charter includes all the expenses for the operation of the aircraft, its ground staff, the PIC, and any other crewmembers and associated costs. The PIC assigned to this particular flight doesn’t have OpCon, as Acme Aero retains all elements of OpCon and only delegates certain duties to the PIC.

3. Part 125 Operation (Private Carriage): This type of flight operation is authorized under Part 119 and is a type of Air Carrier that operates a large aircraft (20 or more passenger seats or max payload equal or greater than 6,000 lbs) but is not held out to the public. It is common that these private carriers also do not hold out and operate without compensation. Example: A football team franchise purchases a 767 to fly their team and staff to games. Since it is considered a large aircraft by the definition above, they must receive a Part 125 operators certificate. However, since they will not charge their players or staff for these flights, no compensation will occur and the flight operation runs as an expense to the organization as a whole. Although the team has an operator’s certificate from the FAA, they cannot hold out to the public or engage in operations for compensation. The PIC assigned to this type of flight doesn’t have OpCon. The football franchise retains all elements of OpCon and only delegates certain duties to the PIC.

4. Commercial Operation: For the purposes of this discussion we will refer to a commercial operation as any operation in which a transportation package is provided for some sort of compensation. The transportation package in this case includes a pilot and an aircraft.

5. Commercial Activity: While the FAA doesn’t formally separate these terms, it’s useful to distinguish. Commercial activity covers what a pilot may do for compensation. Example: A pilot hired to fly a Part 91 personal flight is engaging in commercial activity, even though the overall operation is non-commercial.

Elements of Operational Control

Perhaps now is a good time to actually discuss the elements of OpCon. Unfortunately, the FAA doesn’t spell these out exactly in the FARs, Handbooks, or the AIM. Instead, to find the elements we have to dig into the Advisory Circulars, specifically, AC 91-37B – Truth In Leasing.1 On page 4 of that document, the FAA lists a few questions we can use to clarify who is maintaining OpCon for any given flight:

  1. Who makes the decision to assign crewmembers and aircraft; accept flight requests; and initiate, conduct, and terminate flights?
  2. For whom do the pilots work as direct employees or agents?
  3. Who is maintaining the aircraft and where is it maintained?
  4. Prior to departure, who ensures the flight, aircraft, and crew comply with regulations?
  5. Who decides when/where maintenance is accomplished, and who directly pays for the maintenance?
  6. Who determines weather/fuel requirements, and who directly pays for the fuel?
  7. Who directly pays for the airport fees, parking/hangar costs, food service, and/or rental cars?
Key Takeaway

If you are responsible for any of the criteria listed above, then you have some operational control. If you are not responsible for any or all of the criteria listed above, then you do not have operational control and the aircraft is a wet lease requiring full compliance with the provisions of Part 135 for air charter operations to carry passengers for hire.

As the PIC, you should know the answers to all of these questions prior to doing any flight. If you have any doubt as to the answer of one or more of these questions then you need to start asking questions until you have the answer.

Scenario A1: Widgets R Us (Part 91 Flight Department)

The Setup

A few months ago, you landed your first commercial aviation job and have been flying a King Air 200 for a local company. The company is called “Widgets R Us” and they produce small widgets used in all sorts of manufacturing. They purchased a King Air to help fly their staff around the country and frequently visit multiple small towns in the region per day. Usually, you have the same 3 to 4 employees on board and fly them to different locations so they can sell and/or deliver widgets. You are employed as a W-2 employee with full salary and benefits to be the PIC of the King Air. Your job description states: “The PIC is directly responsible for, and is the final authority as to, all decisions regarding the operation of the aircraft.” This includes things like flight planning, weight and balance, fuel requirements, etc. Over the past few months you have gotten into a good work rhythm and have really been enjoying the valuable flight time. The pay is good and you even have a company credit card to pay all the aircraft expenses, as well as hotel and rental car expenses when you’re on the road.

Scenario A1 Discussion

So far the scenario describes a normal Part 91 flight department. Looking back to our OpCon questions we should be able to answer all of them:

1. Who makes the decision to assign crewmembers and aircraft; accept flight requests; and initiate, conduct, and terminate flights?

Widgets R Us. They hired you as a pilot (assigned you as a crewmember) and have delegated some of these responsibilities to you as PIC, but they retain responsibility for them since you are their employee. While you are able to veto their flight requests as PIC for things like weather and maintenance, you aren’t making the decisions to go fly or decide on specific times.

2. For whom do the pilots work as direct employees or agents?

Widgets R Us. This is self-explanatory as we have already determined that you are their employee.

3. Who is maintaining the aircraft and where is it maintained?

Widgets R Us. They own the aircraft and they are paying for the maintenance. As their employee you may be helping direct said maintenance, but only as an employee. They are authorizing and paying for all the maintenance.

4. Prior to departure, who ensures the flight, aircraft, and crew comply with regulations?

Widgets R Us. Again, since you are employed by them, they are taking on the responsibility to ensure you conduct the flight in a way that complies with all applicable regulations. Even if you are the only one in the company that really understands said regulations, the company is ultimately responsible for you since you are their employee.

5. Who decides when/where maintenance is accomplished, and who directly pays for the maintenance?

Widgets R Us. See question 3.

6. Who determines weather/fuel requirements, and who directly pays for the fuel?

Widgets R Us. Although you may be making this decision as the PIC on weather and fuel planning, you are making that decision on behalf of the company you work for. More importantly, the company is the one paying for the fuel.

7. Who directly pays for the airport fees, parking/hangar costs, food service, and/or rental cars?

Widgets R Us. The company credit card you have is used to pay all the airport fees and food catering as well as any rental car fees. The company also pays for the primary hangar costs.

Conclusion

Widgets R Us clearly retains OpCon. This is a standard Part 91 corporate flight department operation.

Scenario A2: Widgets R Us (Blurring the Lines)

The Setup

One day your supervisor texts you to prepare for another trip. You preflight the King Air and wait at the hangar. When the passengers arrive, you recognize your supervisor; but the rest are a family of four you’ve never seen. Your supervisor explains that the father runs a successful online widget business. To build a relationship, Widgets R Us has offered the family use of the company aircraft for a short trip.

The Gray Area of Compensation

At first glance, Scenario A2 looks a lot like Scenario A1. Widgets R Us still owns the King Air, employs you as a W-2 pilot, and pays for all operating expenses. By the operational control checklist, they still clearly hold OpCon.

The real issue here isn’t OpCon, it’s compensation. The FAA and NTSB have consistently taken the position that compensation can be anything of value, not just money. That includes goodwill, business opportunities, or the expectation of future economic benefit.

Babbit v. Wallace, NTSB Order No. EA-5461 (2009): Compensation includes intangible benefits, not just cash.2

Blakey v. Murray, NTSB Order No. EA-5061 (2003): Compensation can include non-monetary advantages, even when no money changes hands.3

In this case, Widgets R Us is offering the family a “free” flight in hopes of securing future widget business. That expectation of economic benefit makes the trip a compensated operation.

Why the NBAA Small Aircraft Exemption Matters

Normally, the cost-sharing and reimbursement allowances in 14 CFR 91.501(b) (Subpart F) apply only to large aircraft (>12,500 lbs MTOW), multi-engine turbojets, and fractional program aircraft. That means a King Air 200 would not qualify.

The NBAA Small Aircraft Exemption4 extends certain provisions of 91.501(b) to small turboprops, pistons, and helicopters. Specifically, it allows operators of those aircraft to make limited use of §91.501(b)(1)–(7) and (9). These cover:

  1. Ferry or training flights
  2. Aerial work (survey, photography, patrol, etc.)
  3. Demonstration flights for prospective customers
  4. Personal/guest transportation when no fee is charged
  5. Carriage of company officials, employees, guests, and property incidental to company business (with important restrictions on guests)
  6. Time-sharing, interchange, and joint-ownership arrangements
  7. Carriage of property incidental to business
  8. Carriage of persons incidental to non-aviation business (e.g., showing land, goods, franchises)

The exemption allows these operations to be conducted in small aircraft under Part 91 without drifting into Part 135, but only if they are incidental to the company’s business and do not involve common carriage.

Applying This to Widgets R Us

Without the NBAA exemption, Widgets R Us clearly risks operating an illegal charter by carrying the family for expected business benefit. Even with the exemption, the flight would only be permissible if:

If the trip is essentially a vacation or entertainment perk, or if the “guests” dictate the destination, the flight would not qualify. It would be considered carriage for compensation without proper certification.

Bottom Line

While Widgets R Us retains OpCon, the purpose of the flight transforms the operation. This is where well-intentioned corporate operators can accidentally step into Part 135 territory.

Scenario B: Acme Aero (Part 135 Operation)

Now let’s look at a different environment entirely: a Part 135 certificate holder. Acme Aero is a basic air taxi operator with a single Learjet 45 (N8675) on its certificate. As with any 135 operator, Acme Aero’s operations specifications (OpSpecs) designate three people who may exercise operational control for air taxi flights:

A key detail: a crewmember cannot dispatch a flight that they are flying on. So, if the Chief Pilot is assigned as PIC, another authorized individual must actually release the flight.

Acme Aero holds a Part 119 certificate authorizing common carriage, and they use a third-party broker to advertise trips and connect with clients. The broker provides customer requests to multiple carriers, and the client chooses from the bids. Once Acme Aero is chosen, the dispatcher coordinates with one of the three authorized persons to release the flight.

The Setup

Our scenario begins with a newly hired commercial pilot who has just completed indoctrination, initial qualification, an instrument proficiency check, and a line check. With these check rides complete, the pilot is now current and qualified to serve as second-in-command (SIC) in the Learjet 45. Remember: under Part 135, both the PIC and SIC must be current and type-rated, unlike Part 91 where the SIC might only need a multi-engine rating.

The pilot receives a call from their PIC: a charter has been booked to take clients from Orlando, FL to Teterboro, NJ the next morning at 0800.

What Questions Should the Pilot Ask?

  1. Who exercised Operational Control? Was the flight properly released by one of the three authorized individuals (DO, CP, DOM), and not by a crewmember flying the leg?
  2. Is this a Part 135 flight? Was the trip sold as common carriage through Acme Aero’s certificate, or is there any indication the broker arranged a flight outside of the OpSpecs?
  3. Is the flight within the scope of the OpSpecs? Is N8675 (the Lear 45) listed on the certificate for this type of operation? Are Orlando (departure) and Teterboro (arrival) authorized airports for Acme Aero?
  4. Are both pilots current and qualified under Part 135? Has each pilot completed the required 135 check rides (PPC, IPC, line check) within required timeframes? Is the SIC’s training file complete and signed off?
  5. Was the client booking handled properly? Did the client contract with Acme Aero (the certificated operator), or with the broker directly?
  6. Has the release package been provided? Does the dispatcher or authorized person provide a flight release with fuel load, maintenance status, MEL/CDL items, weather, and weight and balance compliance?
  7. Are crew duty and rest limits satisfied? Is the crew within duty/rest compliance per Part 135 Subpart F (or K if commuter)?
Teaching Point

This scenario underscores that operational control in 135 is structured differently than in 91. Even though the pilots fly the trip, OpCon rests with the company officials identified in the OpSpecs. The pilot’s role is to verify that the flight was properly dispatched, released, and authorized under the certificate. If any of those elements are missing, the flight could fall outside of Part 135 and into illegal territory—even if the pilots are qualified and the jet is airworthy.

Scenario B Continued: The Substitution Trap

The Setup

The morning of the flight, our new SIC arrives early at the hangar. Wanting to make a strong first impression, they preflight the Lear 45 and have it nearly ready to go. When the captain shows up, however, it isn’t the pilot they expected.

Instead, it’s the businessman’s personal pilot. While the Learjet (N8675) is leased to Acme Aero and maintained to Part 135 standards, the businessman still occasionally uses it for personal trips under Part 91 with his own crew.

The personal pilot explains: late last night, the Acme Aero Chief Pilot called him. The scheduled PIC for today’s 135 trip had a family emergency. The Chief Pilot stressed that this client is too important to cancel on. To avoid losing the business, Acme Aero offered to run the trip “at cost,” billing only for fuel. Since no profit is being made, the Chief Pilot insists the flight doesn’t need to be dispatched under Part 135. Instead, he directs the personal pilot to conduct the flight as a Part 91 operation—no flight release required.

Red Flags

1. Common Carriage Doesn’t Disappear. Even if Acme Aero says it’s “at cost,” the flight was brokered and sold as a Part 135 charter. The client contracted with a certificated carrier, not with the businessman privately. The FAA considers that common carriage regardless of whether the operator profits.

2. Operational Control Conflict. The Chief Pilot is effectively telling the crew to bypass Acme Aero’s OpCon procedures. In reality, Acme Aero remains responsible since the flight was arranged through their certificate. Trying to “rebrand” the flight as Part 91 doesn’t remove that responsibility.

3. Unqualified Crew. The personal pilot may be legal under Part 91 (type rated and current for takeoffs/landings), but he is not current under Part 135. Using him for a charter customer violates the 135 OpSpecs and training requirements.

4. Dispatch and Release Violations. By avoiding a dispatch release, Acme Aero is sidestepping the very oversight designed to ensure compliance. The absence of a legal release is itself a violation.

Teaching Point

This situation is a textbook example of how Part 135 operators get into trouble. A legitimate 135 trip, sold to a client, is suddenly relabeled as a “Part 91” flight to cover for a crew shortage. The justification of “no profit” or “fuel-only” doesn’t change the fact that compensation is present and common carriage exists. Once the trip was brokered as a charter, the only legal way to operate it is under Acme Aero’s Part 135 certificate, with a current and qualified crew, and a proper dispatch release.

You cannot “flip a switch” from 135 to 91 just because it’s convenient. If the client is paying—whether full price, cost, or even a favor that generates business goodwill—it’s still common carriage, and it must be flown under the 135 certificate.

When the Flight Doesn’t Launch

The client calls at the last minute to cancel the trip. Our new SIC exhales, grateful they won’t have to choose between breaking the law and disobeying their new employer on their very first assignment. But the relief is short-lived—because what just happened still matters.

The Chief Pilot’s willingness to substitute a non-current pilot, skip the 135 dispatch process, and re-label a brokered charter as a “Part 91” operation shows a troubling gap in compliance culture. Even though the flight never left the ramp, the FAA doesn’t require that an illegal charter actually be conducted for enforcement action to apply. The willingness and intent to conduct the flight outside the certificate is enough to get both the operator and the pilots in serious trouble.

For the SIC, this raises new concerns:

The Backup Jet

Months have passed since the SIC’s rocky start at Acme Aero. Since then, every trip has looked professional and by-the-book. Dispatch releases have been handled properly, crews have been current, and the company’s maintenance team has impressed the SIC with their attention to detail. The earlier brush with a questionable “Part 91 cover story” seemed like a one-off lapse in judgment, and the SIC allowed themselves to believe the company’s culture was sound.

Today’s assignment is a standard charter from Orlando to Charlotte in the Learjet (N8675). During preflight, however, the crew discovers a critical maintenance issue. The Director of Maintenance is consulted, and it’s agreed the aircraft cannot be dispatched until the discrepancy is corrected. The SIC is relieved to see the system working as intended: the aircraft is grounded, safety is prioritized, and compliance is respected.

But then the Chief Pilot arrives. Unwilling to cancel a flight on a valued customer, he offers a “solution.” He sometimes contracts with another owner on the field who has an identical Lear 45. That airplane is even maintained by Acme Aero’s own maintenance department to 135 standards—though it is only operated under Part 91. After a few phone calls, he secures the “backup jet,” proudly announcing the trip can proceed without delay.

The Problem

The problem isn’t that the aircraft isn’t safe. The problem is that it isn’t legal. Part 135 certificate holders may only operate aircraft listed on their Operations Specifications (OpSpec D085). No matter how similar or well-maintained the backup Lear 45 may be, it hasn’t gone through the FAA’s conformity process and cannot be used for a 135 flight. Attempting to swap in a non-listed airplane is a clear violation.

The Breaking Point

This is the second time the SIC has seen Acme Aero leadership willing to bend or break the rules when a customer is at risk of being inconvenienced. What once seemed like an isolated lapse now looks like a pattern of noncompliance. The SIC realizes that staying with this company could risk not only their reputation, but also their certificate and career.

In the moment, the SIC remains professional. They decline participation in the flight with measured words:

“I understand the desire to take care of the customer, but I can’t participate in this flight. Since this Lear isn’t listed on our D085, it isn’t authorized for Part 135 operations. I don’t want to put the company—or myself—in a position of regulatory risk. I’ll be glad to help reschedule once we have an approved aircraft available.”

The passengers are never boarded, but the SIC’s decision is made. Later that week, they submit a respectful resignation letter:

By phrasing their refusal and resignation in this diplomatic way, the SIC protects their own integrity and avoids burning bridges. Under PRIA rules, future employers can contact Acme Aero, so maintaining professionalism is critical. This final episode makes it clear: the company’s pattern of “lean forward” solutions has crossed a line that the SIC cannot follow.

This is just an example of how you might handle this. Hopefully, you will never find yourself in this type of situation, but if you do, you want to distance yourself from the operation as quickly as possible, keeping the PRIA rules in mind. Anonymous tips can be made to the FAA hotline and should be strongly considered for any willful rule violations, especially when it becomes a pattern.

Conclusion

I hope that this was informative and that you walk away from this having a better understanding of commercial operations as a whole and potential pitfalls. Avoiding illegal charter is something all commercial pilots and operators are responsible for but it is much easier said than done. It becomes more difficult when you find yourself in a position as a pilot with a lot of money on the line. This is an important incentive that often gets overlooked.

It’s very easy for you as an applicant in the safety of a checkride or training environment to say that you would never do something questionable. However, I know the decision will be much harder in the real world when you have the monthly bills coming due and an operator offering you a five figure payout to do a trip in a shiny new jet to an exotic destination. Walking away from a 2K–3K (or more in some cases) trip is much easier said than done, trust me. The best protection for you is to build the knowledge now, and be prepared to ask the right questions on the front end to avoid being caught in a compromising situation with not only a lot of money on the line but your certificate as well.

1 AC 91-37B – Truth in Leasing ↑

2 Babbit v. Wallace, NTSB Order No. EA-5461 (2009) ↑

3 Blakey v. Murray, NTSB Order No. EA-5061 (2003) ↑

4 NBAA Secures Exemption for Small Aircraft to 2026 ↑