Aircraft Repossessions Considerations & Cape Town Agreement

First of all we can consider an agreement commonly referred to as the Cape Town Convention 2001.

The Cape Town Convention (2001) is often referred to during an Aircraft Repossession and has circa 80 countries as members. Within this we can consider the “Matters Specific to Aircraft Equipment” and the aim of the Protocol is to protect the title and security interests in the aircraft and engines. 

The Protocol brings speed, certainty, and cost savings to the process of repossessing aircraft and engines on an insolvency or other default, particularly where these assets are in a country whose legal system would otherwise give cause for concern in such matters.

This is an important consideration if we would consider the repossession of an aircraft. Prior to any repossession the foreign jurisdictions and The Cape Town Convention would be considered along with some other prevalent factors including:

The lease agreement itself, the location of the aircraft and current repossession rights; we would want to define a strategy in order to cease the asset.

We need to move the aircraft and so would need to consider the future plan for the aircraft (destination can be defined by this)’ often short-term storage might be sought or flight ready parking although the scope of maintenance approvals for the destination vs work scope required might be of consideration remembering to consider impacts of a registration change if this will occur.

Records will always be a point of contention and the CAMO point of contact would be important to establish for then required details and also a contact in the lessee. Current maintenance and configuration will be required for the aircraft.

We need to be aware of the configuration including is 3rd party assets are installed such as loan items, or engines for example.

You will need a method to move the aircraft such as a ferry flight company ensuring that all permits, insurance and details are available along with an onsite date arranged with location.

There me be liens outstanding on the aircraft and you might find an airport will not release an aircraft with outstanding fees as such this needs to be covered prior to departure.

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