King & Wood Mallesons (KWM) has a team of lawyers specialising in cross-border aviation, vessel, and other asset transactions, and is an industry leader in aircraft financing and leasing. Our experience of advising on aircraft finance in the Chinese market can be traced back to the late 1980s when Chinese airlines had just begun acquiring or leasing large aircraft with foreign debt. For more than 30 years, we have been keeping abreast of the development of the aircraft financing market and participated in almost all types of aircraft leasing and financing transactions in the market. Our rich experience enables us to go deep into all aspects and details of aircraft leasing and financing transactions, and assist domestic and foreign lessors, lenders, and lessees in completing their transactions. In addition, by working closely with the aviation teams practicing English law, Hong Kong SAR law, and New York law in other KWM offices, we are able to provide clients with one-stop, multi-jurisdictional and all-round legal services.
Given the complexity, technicality, and diversity of aircraft financing projects, the requirements on legal services are extremely rigorous. KWM’s aircraft financing team has participated in almost all types of aircraft financing and leasing transactions in the Chinese market, including:
- Cross-border operating leases and “LILO” structure subleases
- Domestic and cross-border sale and leaseback
- China Free Trade Zone structure lease
- Japan operating lease/Japan leveraged lease
- US tax structure financing
- US import and export financing with bank warranty /European ECA structure
- French tax financing
- Aircraft prepayment financing
- Assets securitisation of aircraft leasing
- Asset factoring financing of aircraft leasing
- Sale of aircraft asset packages
- Other types of aircraft and aircraft engine financing projects
In these transactions, we provide clients with comprehensive legal services,
as well as the most practical and feasible legal solutions in line with their best interests according to changes in legal environment and market conditions, including:
- Determining transaction structure from the legal perspective
- Drafting and finalising transaction documents
- Assisting clients with negotiations on transaction documents and other transaction matters
- Advising on relevant legal issues
- Issuing legal opinions on transactions and transaction documents
- Assisting clients in reviewing and preparing relevant conditions precedent and conditions subsequent
- Assisting with the registration of the establishment, alteration, and cancellation of the rights of ownership and mortgage of aircraft with the CAAC.
- Assisting with the application for the authorisation code issued by CAAC for registration in the international registry and the registration of establishment, alteration, and cancellation of relevant international interests
- Supporting IDERA's filing with the CAAC
It is noteworthy that KWM lawyers have also led the few bankruptcy/reorganization cases of airlines in the Chinese aviation market and the litigations involving aircraft retrieval by lessors. We have accumulated extensive experience in this industry in terms of filing creditor's rights, retrieving the aircraft, and participating in the litigation on behalf of the lessor, or participating in bankruptcy/ reorganization proceedings as the bankruptcy administrator of airlines.
In addition, KWM also acts as the lead coordinator of the National Contact Group in Mainland China of the Aviation Working Group (AWG) under UNIDROIT, summarising relevant information on the implementation of Cape Town Convention (and other international conventions in aviation) in China and reporting the same to AWG, and providing the updates and the latest information on international conventions to the National Contact Group.
Our aviation practice also covers the trading of company's commercial aircrafts. As a pioneer legal counsel in this emerging market, we work closely with our clients to assist them with the purchase, trust, and financing of the company's commercial aircrafts.
With respect to vessel financing, we advise on the leasing and financing of various assets, including cruises, bulk carriers, drilling platforms, container ships, offshore supply ships, ferry boats, and yachts. We have counselled many well-known international and domestic lessors and banks on complex cross-border transactions, and are highly recognised by clients with Chinese backgrounds or with their transactions involving Chinese aspects.
