Effective 1 January 2018, the Cape Town Convention and the related Protocol (Convention) came into force pursuant to the Bermuda International Interests in Mobile Equipment (Cape Town Convention) Act 2016. The Convention is an international legal framework (recognised in all Contracting States). It enables interested parties to protect and recover their mobile assets with greater certainty and ease by creating an international registry.
Bermuda is entitled to recognition as a territorial unit of a state that is a party to the Convention (Contracting State) via declarations deposited by the United Kingdom on behalf of itself and Bermuda with the International Institute for the Unification of Private Law – UNIDROIT. The Convention's extension to Bermuda will, for example, allow lenders who provide finance to Bermuda companies to protect their interests in any relevant aircraft asset in accordance with the Convention by way of registration of that interest on the international registry (IR).
In accordance with the Convention, an international interest may be registered on the IR if either (a) the aircraft is in a registered Contracting State or (b) the debtor is situated in a Contracting State. Therefore, the interests of a Bermuda entity under applicable transaction documentation or a Bermuda registered aircraft can be registered as an international interest on the IR.
Should you have any questions or require more information on aircraft registration or financing, please do not hesitate to contact us.
The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.