Aircraft Deregistration In Thailand – Aviation

Thailand is not a signatory to the Cape Town Convention. This
means that upon an airline-lessee’s default, a lessor cannot
present an Irrevocable Deregistration and Export Authorization
(IDERA) document to easily repossess an aircraft. However, Thai law
does allow for lessors to obtain aircraft deregisteration without
the need to go to court.

Pursuant to Clause 12 of the Civil Aviation Authority of
Thailand (CAAT) Regulation No. 23 (Reg. 23), the Director General
of CAAT has the authority to deregister an aircraft when the
possessory right to the aircraft under a lease agreement has
expired for any of the following reasons:

• The lease agreement has expired due to the lease term;




• The lease agreement has been terminated by either the lessor or
  the lessee in accordance with its termination clause;




• The lessor and lessee agree to terminate the lease
  agreement;




• The lessor notifies the termination of the lease agreement and
  submits an irrevocable deregistration power of attorney together
  with an application requesting the exportation of the aircraft, and
  the lessor or its agent submits an application for deregistration
  of the aircraft to the Director General.

Under Reg. 23, a lessor can submit a deregistration application
to CAAT asking CAAT to deregister. The deregistration application
consists of evidence of the lease termination, a deregistration
power of attorney (DPOA), the applicant’s certificate of
incorporation, and the aircraft’s certificate of airworthiness
and Certificate of Registration. CAAT will review the application
and ask the lessee if it consents to the deregistration. If the
lessee does not consent, CAAT may invite the lessor and lessee to
one or more administrative hearings to give evidence on the
dispute. If CAAT concludes that the lease has been validly
terminated and the lessee no longer has possessory rights, CAAT
will deregister the aircraft.

Under Thai law, a lessor can terminate its aircraft lease
agreement in accordance with its termination clause. The aircraft
does not need to be physically located in Thailand at the time of
termination. The notice period specified in the lease agreement
must be complied with by the lessor. With that in mind, if the rent
is due monthly and the notice period specified is less than 15
days, the lessor should provide 15 days’ notice before
termination, which is the notice period specified under Thai
law.

A DPOA is recognized and can be a form of security, but is
effective only when it is irrevocable and submitted under Reg. 23.
Thai law does not require any specific form of DPOA. The law also
does not require the DPOA to be certified, notarized, legalized and
translated. From experience, the deregistration applicant should
submit an original DPOA to CAAT. As such, the lessor should obtain
and keep original versions of the executed DPOA.

Once CAAT issues a deregistration order, the lessor can show the
order to the relevant airport authority (i.e. Airports of Thailand
PCL) and take physical control of the aircraft. If the lessee owes
debts to any government agency or its employees, CAAT will not
allow the lessor to export the aircraft until the debts are paid.
The lessor should expect to pay these debts in order to export the
aircraft.

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.