Implementation of the Default Remedy Mechanisms of the Cape Town Convention and Aircraft Protocol in China

Currently in China, there is unpredictability as to whether creditors can promptly repossess aircraft in the event of debtor default in accordance with Article 13 of the Convention on International Interests in Mobile Equipment (‘Cape Town Convention’ or ‘CTC’). There are also obstacles to creditors procuring aircraft deregistration through the irrevocable deregistration and export request authorization (IDERA) route of the Protocol to the Convention on International Interests in Mobile Equipment on Matters Specific to Aircraft Equipment (Aircraft Protocol). Recommendations: (1) formulate a judicial interpretation of Article 13 of CTC to clarify the difference between Article 13 as a special advance remedy and the interim relief remedies provided in Chinese domestic law; and (2) amend the procedural rules promulgated by the Civil Aviation Administration of China (CAAC) in relation to the IDERA. These practices will further promote the implementation of the CTC and the Aircraft Protocol and ensure that creditors can promptly repossess and deregister aircraft in the event of debtor default.