Q1: What necessitates a lender or a lessor to opt for Aruba as an aircraft registry of choice?
A1: Because Aruba has ratified the Cape Town Convention and the Aircraft Equipment Aircraft Protocol. As of September 1st, 2010, Aruba is one of the very few off-shore aircraft registries having adopted these instruments. Moreover, Aruba has made the necessary Declarations under the Cape Town Convention to safeguard the interests of the lessors and lenders. Besides, Aruba provides for a legal insolvency regime, which provides these parties with more extensive rights than the Cape Town Convention.
Q2: What security rights are available to protect the interests of the lenders?
A2: As of the introduction of Cape Town a right of pledge under Aruba law is the preferred security instrument instead of the traditional right of the first mortgage under Aruba law.
Q3: Can I establish a pledge on an airframe separately from the engines?
A3: Yes, a right of the first pledge can be vested in the airframe and separately and distinctly on each of the engines.
Q4: Is there a public register for these pledges
A4: Yes, the Aruba law pledges can be registered in the International Registry in Ireland. The IR is open 24x7x365.
Q5: How long does it take to get the pledges perfected?
A5: The process can typically take place in one (1) business day.
Q6: What are the costs of establishing a pledge?
A6: The overall cost, required stamps, and IR fees are very competitive vs the process of creating a right of the first mortgage. The process is also less bureaucratic and does not require judicial intervention or a notary.
Q7: Can you repossess aircraft under Aruba’s Cape Town Regime?
A7: Yes, in Aruba the legal framework for repossession is in place, including the filing of an IDERA with the Department of Civil Aviation of Aruba, and self-help remedies that are otherwise not available in civil law countries are available to the lender.
Q8: Will the residual value of the asset is safeguarded by the registration in Aruba?
A8: The high regulatory and oversight standards imposed by Aruba help maintain a high residual value for the assets in the nationality registry. Lessors and lenders can obtain direct electronic access to aircraft records.
Q9: Can the aircraft be de-registered without the lender’s consent?
A9: Not if a properly filed IDERA is in place.
Q10: Will the lender be subject to any taxes in Aruba by holding a pledge?
PLUS 1: How do I get more info?
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