Many aviation directors bring deep commercial, financial or legal experience. Fewer arrive knowing that the Civil Aviation Act 1988 gives each of them a duty of care and diligence over the operation. A board paper saying the operation is safe and compliant is not the same as a board that knows it is.
The duty in section 28BE
Section 28BE requires the holder of an Air Operator’s Certificate (AOC) to take all reasonable steps to ensure that every activity covered by the AOC is done with a reasonable degree of care and diligence. Where the holder is a company or other body corporate, each of its directors must also take those steps: the duty is individual, not just collective.
Management and information are the test. A lapse caused mainly by inadequate corporate management, control or supervision, or by poor systems for getting relevant information to relevant people, is evidence of a breach (s 28BE(3)).
It adds to other duties. No damages action lies (s 28BE(4)), and duties under other laws, such as corporations and work health and safety law, are unaffected (s 28BE(5)).
Section 28BE applies to AOC holders, not to holders of only maintenance, training or aerodrome approvals, though the same board questions apply.
What CASA can do
Compliance with section 28BE is a condition of every AOC (s 28BA(1)(a)). For a breached condition, CASA may suspend or cancel the AOC after a show-cause process (s 28BA(3)–(4)). It can also impose conditions (s 28BB), accept an enforceable undertaking (s 30DK) and, for a serious and imminent risk to air safety, suspend immediately (s 30DC).
Section 28BE carries no penalty of its own. The exposure is to the certificate the business depends on, and to the record of what the board knew, asked and did.
Directors are not the chief executive officer
Part 119 of the Civil Aviation Safety Regulations 1998 makes the chief executive officer of an Australian air transport operator accountable to the operator and CASA (regulation 119.130), supported by the other key personnel. Some other Parts use the title accountable manager; Part 119 does not.
The board’s task is to make sure that structure exists, is resourced and works. A CEO who is also a director carries both roles. Our companion Insight on Part 119 key personnel covers the CEO’s side.
What reasonable steps look like
Section 28BE does not list the steps. A board that has taken them can usually show that it:
knows the operator’s main safety and regulatory risks, and how much of each it will accept
receives safety information that shows risk and trend, not just activity counts
tests what it is told, independently where the stakes justify it
funds the operation to the standard its exposition describes
knows what CASA has raised and how management responded, and records its own questions and follow-up.
Overseeing the safety management system
Directors do not run the safety management system. The safety manager manages it, and the CEO ensures it is implemented and managed. The board’s role is oversight: knowing what the system is telling management, whether the safety manager is independent and free of undue influence, and whether assurance is finding problems or merely confirming none were sought.
How we work with boards
KMF’s Principals have seen accountability for safety and security from both the regulator’s side and the operator’s. Craig Martin was CASA’s Executive Manager Regulatory Oversight, and has been an airline chief operating officer and a senior check and training captain. Peter White has held senior roles in transport safety and security, regulatory operations and investigation at Commonwealth and international level, across aviation and maritime. His focus is rebuilding a regulatory, security or operational function after it has been found wanting. We work directly and confidentially with boards, chairs and directors on:
governance briefings and workshops on section 28BE and the board’s role in safety oversight
independent reviews of board safety reporting, risk appetite and assurance
support for boards whose safety or security function has lost the confidence of its regulator, and has to earn it back
independent counsel to chairs and directors, including when CASA’s attention turns formal
operational and regulatory due diligence for incoming directors, investors and acquirers.
Talk to us about your board
If your board wants an independent view of how it meets its section 28BE duty, or a director new to aviation wants a candid briefing, start a conversation. Every enquiry is read by one of KMF’s Principals and treated as confidential. Where privilege matters, we can be engaged through your legal advisers.
