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.