Part 135 vs Part 91: what the difference actually means for charter operators and passengers

The question "what is the difference between Part 135 and Part 91?" sounds basic. The answer is not. It determines whether a flight is legal, whether the passengers have regulatory protections, whether the insurance policy applies, and whether the pilot in command is operating under a certificate that actually covers the flight being conducted.

Getting it wrong — knowingly or not — is gray charter: the most serious recurring violation in on-demand aviation, and one that results in certificate suspensions, civil penalties, and in the event of an accident, catastrophic liability exposure for everyone involved.

The foundational distinction

14 CFR Part 91 governs general aviation — private flying, flight training, aerial work, and most corporate operations. Under Part 91, there is no certificate required from the FAA to operate an aircraft. The pilot needs an appropriate certificate and medical; the aircraft needs an airworthiness certificate and registration. That is essentially it.

14 CFR Part 135 governs on-demand air transportation — the business of carrying passengers or cargo for compensation or hire in an unscheduled operation. Under Part 135, the operator — the entity conducting the flight, not just the pilot — must hold a certificate issued by the FAA authorizing that operation. The certificate comes with approved Operations Specifications (OpSpecs), a General Operations Manual (GOM), approved minimum equipment lists, designated check airmen, and an ongoing compliance relationship with a Flight Standards District Office.

The simplest summary: under Part 91, the FAA regulates the people and the aircraft. Under Part 135, the FAA also regulates the operation itself.

What triggers Part 135

14 CFR 135.1 defines the scope: Part 135 applies to each person who operates an aircraft carrying persons or property for compensation or hire as an air carrier or commercial operator. The trigger words are compensation or hire.

Compensation or hire has a broad legal meaning. It includes:

• Direct payment for the flight (charter fee, seat revenue)
• Indirect compensation — a pilot who gets a free ride in exchange for flying someone elsewhere; a business that offsets aircraft costs by charging passengers
• Barter arrangements where a service of value is exchanged for transportation
• Flights conducted as part of a business enterprise where transportation is a component of the service sold

The FAA's guidance (AC 120-12A) is clear: if someone receives a benefit — any benefit — for providing air transportation, compensation is likely present. The analysis is fact-specific, but the bar for triggering the "for hire" requirement is low.

The pro-rata cost-sharing exception

The most commonly cited exception to the Part 135 requirement is the pro-rata cost-sharing provision under 14 CFR 61.113(c). A private pilot may share the operating expenses of a flight with passengers as long as the pilot pays at least their pro-rata share of the costs. The passengers pay their share; no one profits; the pilot does not receive anything of value beyond the ability to offset their own flight costs.

This provision is narrow. It requires:

• A common purpose — the pilot must share the destination purpose with the passengers, not just the aircraft
• Genuine pro-rata cost sharing — the pilot pays their own share; the passenger pays theirs
• No profit to the pilot or operator
• Only direct operating costs — fuel, oil, airport fees; not depreciation, insurance, or maintenance reserves

Operations that are structured to look like cost-sharing but where the "pilot" is actually an employee of the company ferrying executives, or where the passengers are paying customers of a business that includes air transportation in its service, are not cost-sharing. They are charter, and they require Part 135.

The key operational differences

What gray charter actually looks like

Gray charter is the practice of conducting what is functionally a charter flight — passengers paying for air transportation — under Part 91 to avoid the regulatory burden of Part 135. It takes several common forms:

• The "dry lease" workaround. A passenger "leases" the aircraft and "hires" the pilot separately, with the intent of bypassing Part 135. If the operator is actually arranging the transportation, this is gray charter regardless of the contract structure.
• The "flight club" or "membership" model. Passengers pay a membership fee that includes access to charter-like transportation, structured to look like cost-sharing or a club. If the passengers are paying for the transportation and the operator profits, it is charter.
• The "repositioning" flight. An aircraft repositions from A to B, happens to have passengers on board who "contribute to fuel costs." If the passengers are there because of their payment, not incidentally, it is likely charter.
• The corporate aircraft charged to clients. A company that charges clients for flights on its aircraft is conducting commercial air transportation, not corporate flying.

The FAA's enforcement posture on gray charter has tightened significantly since 2020. The penalties include civil fines up to $25,000 per violation, certificate suspension or revocation, and in the event of an accident, the insurance policy on a Part 91 aircraft almost certainly does not cover a Part 135 operation — leaving everyone aboard uninsured.

Why passengers should care

A passenger on a Part 135 flight has regulatory protections that do not exist under Part 91: the crew has been through recurrent training in the last 12 months, the aircraft has been on an approved inspection program, the duty and rest limits have been checked before the flight, and the operator holds a certificate that the FAA can revoke if those standards are not maintained.

A passenger on a gray charter flight has none of those protections. They are, legally, a passenger on a private flight — with all the risk that implies.

The way to tell: ask the operator for their Part 135 certificate number before you get on the aircraft. It is a public record. If they cannot provide it, or if it does not match the operation being conducted, the flight is almost certainly not legal for compensation.