Retention of contracts and amendments: Commercial operators who conduct intrastate operations for compensation or hire

This regulation requires commercial operators conducting intrastate flights for compensation or hire to maintain records of their service contracts. If you have a written contract with a customer, you must keep a copy for at least one year after signing it. If you operate under an oral (verbal) agreement, you must create and keep a written memorandum documenting the essential terms of that agreement, also for at least one year.

This record-keeping requirement helps the FAA verify the nature and terms of your commercial operations during inspections or investigations. It ensures there's documentation of what services you agreed to provide, which can be important for regulatory compliance and resolving disputes. The one-year retention period gives the FAA a reasonable window to review your business arrangements while not imposing an indefinite storage burden on operators.

*This is a plain-English summary for study only. The official 14 CFR text on this page is controlling — always read the current regulation and consult a CFI.*