In Parts Produced by an Owner or Operator. Are They Legal? flight operations expert witness David A Botich offers an excerpt from Federal Aviation Regulations:
PART 21-CERTIFICATION PROCEDURES FOR PRODUCTS AND PARTS
Subpart K – Approval of Materials, Parts, Processes, and Appliances
21.303 Replacement and modification parts.
a) Except as provided in paragraph (b) of this section, no person may produce a modification or replacement part for sale for installation on a type certificated product unless it is produced pursuant to a Parts Manufacturer Approval issued under this subpart.
(b) This section does not apply to the following:
1. Parts produced under a type or production certificate.
2. Parts produced by an owner or operator for maintaining or altering his own product.
3. Parts produced under an FAA Technical Standard Order.
4. Standard parts (such as bolts and nuts) conforming to established industry or U.S. specifications.
This is stated in FAR 21.303 (b) (2) above but does not explain how this can be accomplished, only that it can. The intent of this is to allow owners a way to keep their aircraft airworthy if parts are unavailable or otherwise unobtainable. This does not mean that your needs must meet any specific requirements, such as the part is no longer produced or it takes six months to get it, but only that you follow the requirements of producing that part.