Tuesday, October 16, 2018

Govt plans to bring in Cape Town Convention Act for civil aviation sector

The government plans to bring in the Cape Town Convention Act which will help reduce risks related to asset-based financing and leasing transactions in the civil aviation space.
The main objective of the Convention/ Protocol is to ensure efficient financing of high value mobile equipment like airframes, helicopters and engines, in order to make the operations as cost effective and affordable as possible, according to the Civil Aviation Ministry.
The proposed implementation of the Cape Town Convention Act also comes at a time when many Indian carriers have placed large orders for aircraft as they embark on ambitious expansion plans. The country's domestic aviation market is one of the fastest growing in the world and has been registering double-digit growth for more than three years.
In November 2001, the Convention on International Interests in Mobile Equipment and the Protocol to the Convention on Matters Specific to Aircraft Equipment were adopted. Since they were adopted during a conference in Cape Town, they have been named after the city in South Africa.
While Cape Town Convention is for three sectors -- aviation, railways and space equipment --, there are separate protocols for each of the three. The aircraft protocol was adopted at Cape Town in 2001.
The conference was under the auspices of the International Civil Aviation Organisation (ICAO) and the International Institute for the Unification of Private Law (UNIDROIT).
The ministry has put out the draft Cape Town Convention Bill for public consultations and also has a clause that would accord primacy to the provisions of the Convention/ Protocol in case of conflict with any other law.
16/10/18 PTI/moneycontrol.com
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