OTTAWA, Dec. 27, 2012 /CNW/ - The Honourable Denis Lebel, Minister of
Transport, Infrastructure and Communities and Minister of the Economic
Development Agency of Canada for the Regions of Quebec, today announced
action to strengthen the airline industry through the Cape Town
Convention and Aircraft Protocol.
These agreements could help Canadian airlines achieve important savings
on aircraft financing.
"The Government of Canada is focused on the economy and working to
create a more competitive business environment in Canada," said
Minister Lebel. "The Convention and Protocol help to strengthen the
airline and aerospace industries through an international legal
framework for the financing of their aircraft equipment."
The Jobs and Growth Act, 2012, which was passed by Parliament earlier this month, includes amendments
to the International Interests in Mobile Equipment (aircraft equipment) Act and other legislation that introduce necessary policy and regulatory
changes to support Canada's participation in the Convention and
This federal legislation, in conjunction with legislation adopted in
Alberta, British Columbia, Newfoundland and Labrador, Northwest
Territories, Nova Scotia, Ontario, Quebec and Saskatchewan, implements
the Convention and Protocol.
Further to today's announcement, the Convention and Protocol will take
effect in Canada on April 1, 2013. They are more formally known as the
Convention on International Interests in Mobile Equipment and the Protocol to the Convention on International Interests in Mobile
Equipment on Matters specific to Aircraft Equipment.
Participation in the Convention and Protocol was confirmed with the
deposit of Canada's instrument of ratification with the International
Institute for the Unification of Private Law (UNIDROIT) in Rome on
Friday, December 21, 2012.
For more information on the Convention: http://www.unidroit.org/english/conventions/mobile-equipment/main.htm
For more information on the Protocol: http://www.unidroit.org/english/conventions/mobile-equipment/main.htm#NR2
The Cape Town Convention and Aircraft Protocol
The Convention on International Interests in Mobile Equipment and the Protocol to the Convention on International Interests in Mobile
Equipment on Matters specific to Aircraft Equipment are multilateral agreements that establish a commercially oriented
international legal framework to protect security and leasing interests
in aircraft equipment (i.e., airframes, engines and helicopters),
thereby facilitating cross-border, asset-based financing and leasing of
The Convention and Protocol allow the value of aircraft equipment to be
used as security for payment, and also establish an international
registry for security interests in aircraft equipment. This registry
records the existence of rights and determines their order of priority
for use in the purchase and financing of aircraft in order to
facilitate the resolution of questions of title in the event of
insolvency or bankruptcy.
The Convention and Protocol provide creditors with greater assurance
that aircraft assets could be recovered in a timely manner in cases
where those operating the assets, including airlines, become
financially insolvent. This allows lending institutions the possibility
of reducing risk premiums. In turn, it will offer more favourable
lending with significant cost savings for the Canadian aviation
The Convention and Protocol will initially apply in Alberta, British
Columbia, Newfoundland and Labrador, Northwest Territories, Nova
Scotia, Ontario, Quebec and Saskatchewan. The Government will extend
the application of the Convention and Protocol to the other provinces
and territories at their request should they adopt the Convention and
Protocol framework as part of their laws.
SOURCE: Transport Canada
For further information:
Office of the Honourable Denis Lebel
Minister of Transport, Infrastructure and Communities,
Transport Canada, Ottawa
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