Cape Town Convention makes skies safer for bankers

Article written by D.ROSS, C. BARBER and E. SUTCLIFFE

Lenders on certain aircraft and aircraft equipment now have the protection of a specialist international registry after legislation was passed last year to bring the Cape Town Convention and Protocol into effect in New Zealand.

The convention, which also provides for remedies if a debtor defaults, is intended to reduce the risk to financiers and therefore to reduce the cost of aircraft funding.

The Cape Town Convention
The Convention on International Interests in Mobile Equipment and the associated Protocol on International Interests in Mobile Equipment Specific to Aircraft Equipment was adopted at a conference in Cape Town and is restricted to:

•airframes which can carry at least 8 people or goods in excess of 2750kg
•helicopters which can carry at least 5 people or goods in excess of 450kg, and
•engines of over a certain size.

It was brought into force in New Zealand on......

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