Equivalent
to 'Alternative A' under the Cape Town Convention, it gives an
insolvent company 60 days to pay any dues on leased aircraft or
engines. Failing that, it must return the assets the lessor.
Minister
for transport, tourism and sport, Leo Varadkar, explained: "This
measure will provide greater certainty to investors in the event of
default and it is hoped that the change will also facilitate the
issuance of Enhanced Trust Equipment Certificates, a form of security
used in aircraft finance, in Ireland to bolster Ireland's position as
a user friendly and leading jurisdiction for aircraft finance and
leasing."
Dómhnal
Slattery, CEO of Irish leasing company, Avolon, backed the moving
saying it would give Irish companies 'greater and more
cost-effective' access to international capital.
Slattery
said: "It is a change which we and others in the industry have
advocated for and one which will strengthen Ireland's position as the
world's leading centre of aviation finance."
Backing
this, Howard Millar, Ryanair’s CFO, said: “We welcome the
Government’s decision to amend current legislation to comply with
the Cape Town Convention governing airline insolvency rules. This
amendment will broaden the sources of financing available for
Irish-based airlines and leasing companies, to further strengthen
Ireland’s aviation industry, and will also assist Ryanair, Europe’s
largest airline, to finance our recent order for a further 175
aircraft for delivery between 2014-2018.”
Tied
in with the new legislation and Shannon's restructuring, the
government will form a new entity, Shannon Group. The group will own
both Shannon Airport and its surrounding 'Shannon Free Zone', a 2.43
square kilometre international business park, which gives its
business residents tax incentives.
The
move follows Shannon Airport's independence, which it took from the
Dublin Airport Authority (DAA) last year.
The
Irish Government also cleared a finance act this year, which provides
capital for the construction and repair of buildings at all Irish
airports including their MRO centres.
afm.aero
