{"id":121160,"date":"2025-12-10T13:36:38","date_gmt":"2025-12-10T13:36:38","guid":{"rendered":"https:\/\/my.legal500.com\/guides\/?post_type=comparative_guide&#038;p=121160"},"modified":"2025-12-10T13:36:38","modified_gmt":"2025-12-10T13:36:38","slug":"japan-aviation-finance-leasing","status":"publish","type":"comparative_guide","link":"https:\/\/my.legal500.com\/guides\/chapter\/japan-aviation-finance-leasing\/","title":{"rendered":"Japan: Aviation Finance &amp; Leasing"},"content":{"rendered":"","protected":false},"template":"","class_list":["post-121160","comparative_guide","type-comparative_guide","status-publish","hentry","guides-aviation-finance-leasing","jurisdictions-japan"],"acf":[],"appp":{"post_list":{"below_title":"<div class=\"guide-author-details\"><span class=\"guide-author\">Nishimura &amp; Asahi<\/span><span class=\"guide-author-logo\"><img src=\"https:\/\/my.legal500.com\/guides\/wp-content\/uploads\/sites\/1\/2019\/03\/logo11273416.1.jpg\"\/><\/span><\/div>"},"post_detail":{"above_title":"<div class=\"guide-author-details\"><span class=\"guide-author\">Nishimura &amp; Asahi<\/span><span class=\"guide-author-logo\"><img src=\"https:\/\/my.legal500.com\/guides\/wp-content\/uploads\/sites\/1\/2019\/03\/logo11273416.1.jpg\"\/><\/span><\/div>","below_title":"<span class=\"guide-intro\">This country specific Q&amp;A provides an overview of Aviation Finance &amp; Leasing laws and regulations applicable in Japan<\/span><div class=\"guide-content\"><div class=\"filter\">\r\n\r\n\t\t\t\t<input type=\"text\" placeholder=\"Search questions and answers...\" class=\"filter-container__search-field\">\r\n\t\t\t<\/div>\r\n\r\n\t\t\t\r\n\r\n\r\n\t\t\t<ol class=\"custom-counter\">\r\n\r\n\t\t\t\r\n\r\n\t\t\t\t\t\t\t\t\t<li class=\"question-block filter-container__element\">\r\n\t\t\t\t\t\t<h3 class=\"filter-container__match-html\">What international aviation conventions has your jurisdiction signed and\/or ratified?<\/h3>\r\n\t\t\t\t\t\t<button id=\"show-me\">+<\/button>\r\n\t\t\t\t\t\t<div class=\"question_answer filter-container__match-html\" style=\"display:none;\"><p>Japan has ratified the 1929 Convention for the Unification of Certain Rules for International Carriage by Air, the Chicago Convention of 1944 on International Civil Aviation, the 1955 Protocol to Amend the Convention for the Unification of Certain Rules Relating to International Carriage by Air signed at Warsaw on 12 October 1929, the 1958 Convention on the Recognition and Enforcement of Foreign Arbitral Awards, the 1963 Convention on Offences and Certain Other Acts Committed on Board Aircraft, the 1970 Convention for the Suppression of Unlawful Seizure of Aircraft, the 1971Convention for the Suppression of Unlawful Acts against the Safety of Civil Aviation, the 1975 Protocol to Amend the Convention for the Unification of Certain Rules Relating to International Carriage by Air Signed at Warsaw on 12 October 1929 as Amended by the Protocol Done at the Hague on 28 September 1955, the 1988 Protocol for the Suppression of Unlawful Acts of Violence at Airports Serving International Civil Aviation, Supplementary to the Convention for the Suppression of Unlawful Acts against the Safety of Civil Aviation, Done at Montreal on September 23, 1971, the 1991Convention on the Marking of Plastic Explosive for the Purpose of Detection, and the 1999 Convention for the Unification of Certain Rules for International Carriage by Air, but has not ratified the 1933 Convention for the Unification of Certain Rules Relating to the Precautionary Arrest of Aircraft, the 1948 Convention on International Recognition of Rights in Aircraft, or the Convention on International Interests in Mobile Equipment and the Protocol to the Convention on Matters Specific to Aircraft Equipment.<\/p>\n<\/div>\r\n\r\n\r\n\t\t\t\t\t<\/li>\r\n\r\n\t\t\t\t\t\t\t\t\t<li class=\"question-block filter-container__element\">\r\n\t\t\t\t\t\t<h3 class=\"filter-container__match-html\">If your jurisdiction has signed and ratified the Cape Town Convention: a. Which qualifying declarations (opt-in and opt-out) has your jurisdiction made under the Cape Town Convention? b. Does the Cape Town Convention take priority over conflicting national law?<\/h3>\r\n\t\t\t\t\t\t<button id=\"show-me\">+<\/button>\r\n\t\t\t\t\t\t<div class=\"question_answer filter-container__match-html\" style=\"display:none;\"><p>N\/A<\/p>\n<\/div>\r\n\r\n\r\n\t\t\t\t\t<\/li>\r\n\r\n\t\t\t\t\t\t\t\t\t<li class=\"question-block filter-container__element\">\r\n\t\t\t\t\t\t<h3 class=\"filter-container__match-html\">Will a court uphold the choice of a foreign governing law in respect of the following contracts and if so, please also state any conditions or formality requirements to this recognition a. Lease and b. Security document (for example, mortgage)?<\/h3>\r\n\t\t\t\t\t\t<button id=\"show-me\">+<\/button>\r\n\t\t\t\t\t\t<div class=\"question_answer filter-container__match-html\" style=\"display:none;\"><p><strong>a. Lease<\/strong><\/p>\n<p>The choice of a foreign governing law to govern the contractual rights and obligations under the contracts (including lease agreements and a security documents) will be upheld as a valid choice of law under private international law in Japan, and such laws will accordingly be applied by the Japanese courts if any claim their jurisdiction upon proof of the relevant principles of the applicable laws, unless such law is contrary to public order or good moral doctrine in Japan.<\/p>\n<p><strong>b. Security document (for example, mortgage)<\/strong><\/p>\n<p>Please refer to the response to 3(a).<\/p>\n<\/div>\r\n\r\n\r\n\t\t\t\t\t<\/li>\r\n\r\n\t\t\t\t\t\t\t\t\t<li class=\"question-block filter-container__element\">\r\n\t\t\t\t\t\t<h3 class=\"filter-container__match-html\">Please confirm whether it is (i) customary and (ii) necessary to also take a local law mortgage and if so, why?<\/h3>\r\n\t\t\t\t\t\t<button id=\"show-me\">+<\/button>\r\n\t\t\t\t\t\t<div class=\"question_answer filter-container__match-html\" style=\"display:none;\"><p>As Japan has not ratified the Cape Town Convention, a Japanese law aircraft mortgage law is customary and necessary.<\/p>\n<\/div>\r\n\r\n\r\n\t\t\t\t\t<\/li>\r\n\r\n\t\t\t\t\t\t\t\t\t<li class=\"question-block filter-container__element\">\r\n\t\t\t\t\t\t<h3 class=\"filter-container__match-html\">Are foreign judgments recognized and enforceable by courts of your jurisdiction and if so, please also state any conditions or formality requirements to this recognition (for example, do you require a local court order confirming such recognition)?<\/h3>\r\n\t\t\t\t\t\t<button id=\"show-me\">+<\/button>\r\n\t\t\t\t\t\t<div class=\"question_answer filter-container__match-html\" style=\"display:none;\"><p>Any judgment for a definite sum given by the foreign courts against any Japanese entity would be recognised and accepted by the courts of Japan without re-trial or examination of the merits of the case if the following conditions are met:<\/p>\n<ol>\n<li>the foreign judgment concerned is final and conclusive;<\/li>\n<li>the jurisdiction of the foreign court for the relevant matter is recognized by any law, order, or treaty in Japan (in this respect, we note that an agreement between the relevant parties may be a basis for the jurisdiction of the relevant court under Japanese law);<\/li>\n<li>the respondent either has been served by summons and not by public notice or has appeared in the action in the foreign jurisdiction without receiving service thereof;<\/li>\n<li>the judgment and the proceedings of the foreign court is not contrary to public order or good moral doctrine in Japan; and<\/li>\n<li>judgments of Japanese courts receive reciprocal treatment in the courts of the foreign jurisdiction concerned.<\/li>\n<\/ol>\n<\/div>\r\n\r\n\r\n\t\t\t\t\t<\/li>\r\n\r\n\t\t\t\t\t\t\t\t\t<li class=\"question-block filter-container__element\">\r\n\t\t\t\t\t\t<h3 class=\"filter-container__match-html\">Is your aircraft registry an owner-register (registering ownership interests) or an operator-register (registering interests as operator)? Please also state any conditions, procedural steps or formality requirements for such registration and explain how this is evidenced (for example, the issuance of a Certificate of Registration)<\/h3>\r\n\t\t\t\t\t\t<button id=\"show-me\">+<\/button>\r\n\t\t\t\t\t\t<div class=\"question_answer filter-container__match-html\" style=\"display:none;\"><p><strong>Registering Entity:<\/strong><\/p>\n<p>The aircraft registry in Japan is an owner registry, and the interests of operators or lessees in aircraft cannot be registered.<\/p>\n<p><strong>Formality requirements:<\/strong><\/p>\n<p>An aircraft with foreign nationality cannot be registered in Japan.<\/p>\n<p>Pursuantto Civil Aeronautics Act in Japan, aircraft held by the entities listed below cannot be registered:<\/p>\n<ol>\n<li>Individuals without Japanese nationality;<\/li>\n<li>Any foreign state or foreign governmental entity, or its equivalent;<\/li>\n<li>Juridical persons or other associations established under the laws of a foreign jurisdiction; or<\/li>\n<li>Juridical persons whose representative falls under any of the above, or where one-third or more of the directors or voting shares fall under, or are held by, any person(s) described above.<\/li>\n<\/ol>\n<p><strong>Application Requirements:<\/strong><\/p>\n<p>An application for registration with the aircraft registry of an ownership interest in an aircraft must be made by the new owner of the aircraft (or its attorney) and is required to describe the following particulars:<\/p>\n<ul>\n<li>the type and model of the aircraft;<\/li>\n<li>the manufacturer of the aircraft;<\/li>\n<li>the manufacturer&#8217;s serial number of the aircraft;<\/li>\n<li>the home base of the aircraft;<\/li>\n<li>the registration mark of the aircraft (if already given);<\/li>\n<li>the name and address of the applicant;<br \/>\nthe name and address of the attorney of the applicant (if the application is made by an attorney);<\/li>\n<li>the grounds for registration and the date thereof; the purpose of registration;<\/li>\n<li>the date of the application; and<\/li>\n<li>the amount of the applicable registration tax and the tonnage of the aircraft.<\/li>\n<\/ul>\n<p>The supporting documents that need to be submitted to the Aeronautics Authority (in the case of initial registration in Japan by a corporate owner of an imported aircraft) are as follows:<\/p>\n<ul>\n<li>\u2022 a power of attorney issued by the applicant (if the application is made by an attorney);<\/li>\n<li>an original and a copy of the certificate of airworthiness for export, issued by the exporter&#8217;s country;<\/li>\n<li>notarised bills of sale issued by the seller or manufacturer, or both;<\/li>\n<li>a certificate of non-registration issued by the exporter&#8217;s country;<\/li>\n<li>a seal certificate of the representative of the new owner (issued within the last three months);<\/li>\n<li>evidence of the home base of the aircraft (such as an original permission letter issued by an airport operator);<\/li>\n<li>evidence of the aircraft&#8217;s weight;<\/li>\n<li>an official payment slip of the registration tax (if the registration tax exceeds<br \/>\n\u00a530,000); and<\/li>\n<li>documents evidencing that the new owner satisfies the ownership requirements. (The Aeronautics Authority might require further documents for registration.)<\/li>\n<\/ul>\n<p>The registration tax will be in the amount of \u00a530,000 per ton. According to the Aeronautics Authority, it usually takes one week (or two weeks depending on the season) from the application date to obtain an official transcript of entry of ownership of the aircraft.<\/p>\n<p><strong>Evidence of Registration:<\/strong><\/p>\n<p>When an aircraft is initially registered in Japan, the Aeronautics Authority issues to the applicant a certificate of registration, which must be kept on board the aircraft.<\/p>\n<\/div>\r\n\r\n\r\n\t\t\t\t\t<\/li>\r\n\r\n\t\t\t\t\t\t\t\t\t<li class=\"question-block filter-container__element\">\r\n\t\t\t\t\t\t<h3 class=\"filter-container__match-html\">Is there a security document register in your jurisdiction where a mortgagee\u2019s interests will be recorded? If so, please also state any conditions, procedural steps or formality requirements for such registration and explain how this is evidenced (for example, the issuance of a certificate or official stamp on the security document)<\/h3>\r\n\t\t\t\t\t\t<button id=\"show-me\">+<\/button>\r\n\t\t\t\t\t\t<div class=\"question_answer filter-container__match-html\" style=\"display:none;\"><p>There are two methods for registering a mortgage in Japan. A full registration of an aircraft mortgage effectively perfects the mortgage against third parties. A provisional registration is also available, which grants priority over subsequently registered security interests; however, it must be converted into a full registration-typically by both the mortgagor and the mortgagee-before the mortgage can be enforced.<\/p>\n<p>Due to the nominal registration tax applicable to provisional registration, arrangements are often made to maintain an aircraft mortgage in provisional status until an actual credit risk involving the mortgagor arises. For provisional registration, a mortgage option agreement is typically prepared for registration purposes, under which an aircraft mortgage is created upon the mortgagee&#8217;s exercise of the option.<\/p>\n<\/div>\r\n\r\n\r\n\t\t\t\t\t<\/li>\r\n\r\n\t\t\t\t\t\t\t\t\t<li class=\"question-block filter-container__element\">\r\n\t\t\t\t\t\t<h3 class=\"filter-container__match-html\">What is the effect of registration of: a. Ownership interest (for example, proof of title to third parties of ownership) b. Lease (for example, perfects the status of the Lessor under the Lease) c. Security document (for example, secures priority over later registered security). If there are any interests that could rank prior to the security document please state these<\/h3>\r\n\t\t\t\t\t\t<button id=\"show-me\">+<\/button>\r\n\t\t\t\t\t\t<div class=\"question_answer filter-container__match-html\" style=\"display:none;\"><p><strong>a. Ownership interest (for example, proof of title to third parties of ownership)<\/strong><\/p>\n<p>Registration is not required for the validity of an ownership transfer of an aircraft; therefore, the transfer is effective without registration, provided that the new owner of a Japanese-registered aircraft must apply for the transfer of registration with in 15 days of the transfer. Failure to do so may result in a non-penal fine of up to \u00a5300,000.<br \/>\nHowever, registration of an ownership interest perfects the transfer against third parties, such as competing transferees and bankruptcy trustees. Accordingly, a transferee cannot assert ownership if another party completes registration of a competing transfer first.<br \/>\nAlthough registration requires multiple supporting documents, which enhance the reliability of the aircraft registry, its accuracy is not officially guaranteed. As a general rule, a person who purchases an aircraft from a seller who is not the true owner does not acquire valid ownership, even if the seller is listed as the registered owner in the aircraft registry.<\/p>\n<p><strong>b. Lease (for example, perfects the status of the Lessor under the Lease)<\/strong><\/p>\n<p>No registration system for lease interests exists in Japan.<\/p>\n<p><strong>c. Security document (for example, secures priority over later registered security). If there are any interests that could rank prior to the security document please state these<\/strong><\/p>\n<p>Registration of a mortgage in Japan is not a condition to its effective creation, but is required for its perfection as against third parties.<\/p>\n<\/div>\r\n\r\n\r\n\t\t\t\t\t<\/li>\r\n\r\n\t\t\t\t\t\t\t\t\t<li class=\"question-block filter-container__element\">\r\n\t\t\t\t\t\t<h3 class=\"filter-container__match-html\">What types of lease are recognized in your jurisdiction?<\/h3>\r\n\t\t\t\t\t\t<button id=\"show-me\">+<\/button>\r\n\t\t\t\t\t\t<div class=\"question_answer filter-container__match-html\" style=\"display:none;\"><p>Japan recognizes both finance leases and operating leases. Underthe Japanese Civil Code, there is no distinction between the two, and a lease agreement does not require any specific form. Agreements intended for use before Japanese courts must be officially translated into Japanese; however, an agreement executed in any language between the parties remains valid.<\/p>\n<\/div>\r\n\r\n\r\n\t\t\t\t\t<\/li>\r\n\r\n\t\t\t\t\t\t\t\t\t<li class=\"question-block filter-container__element\">\r\n\t\t\t\t\t\t<h3 class=\"filter-container__match-html\">What formalities are required to perfect Lessor\u2019s rights under a lease in your jurisdiction (for example, translation, notarization, apostille, legalization etc.)?<\/h3>\r\n\t\t\t\t\t\t<button id=\"show-me\">+<\/button>\r\n\t\t\t\t\t\t<div class=\"question_answer filter-container__match-html\" style=\"display:none;\"><p>Under Japanese law, no formalities are required to perfect Lessor&#8217;s rights under a lease in Japan<\/p>\n<\/div>\r\n\r\n\r\n\t\t\t\t\t<\/li>\r\n\r\n\t\t\t\t\t\t\t\t\t<li class=\"question-block filter-container__element\">\r\n\t\t\t\t\t\t<h3 class=\"filter-container__match-html\">Are the ownership rights relating to engines recognized as separate and distinct from the ownership of the rest of the aircraft in your jurisdiction? Please highlight any separate registration, filing or additional formalities that are required to be completed to perfect Lessor\u2019s interest in the engines<\/h3>\r\n\t\t\t\t\t\t<button id=\"show-me\">+<\/button>\r\n\t\t\t\t\t\t<div class=\"question_answer filter-container__match-html\" style=\"display:none;\"><p>Under the Japanese Civil Code, an aircraft engine is recognized as a separate object of ownership from the host aircraft. However, there is no registration system for interests in aircraft engines in Japan.<\/p>\n<\/div>\r\n\r\n\r\n\t\t\t\t\t<\/li>\r\n\r\n\t\t\t\t\t\t\t\t\t<li class=\"question-block filter-container__element\">\r\n\t\t\t\t\t\t<h3 class=\"filter-container__match-html\">What form does security over aircraft generally take in your jurisdiction?<\/h3>\r\n\t\t\t\t\t\t<button id=\"show-me\">+<\/button>\r\n\t\t\t\t\t\t<div class=\"question_answer filter-container__match-html\" style=\"display:none;\"><p>The most common form of security over an aircraft is an aircraft mortgage. An aircraft registered in Japan cannot be pledged. While it is possible to create a security interest in an aircraft through collateral assignment or provisional registration of a transfer of ownership interest, such alternative forms of security are uncommon in Japan due to relatively high registration taxes and ownership requirements for transferees.<\/p>\n<\/div>\r\n\r\n\r\n\t\t\t\t\t<\/li>\r\n\r\n\t\t\t\t\t\t\t\t\t<li class=\"question-block filter-container__element\">\r\n\t\t\t\t\t\t<h3 class=\"filter-container__match-html\">Are there any particular terms or characteristics that such a security document must take (for instance, a cap on the secured liabilities)?<\/h3>\r\n\t\t\t\t\t\t<button id=\"show-me\">+<\/button>\r\n\t\t\t\t\t\t<div class=\"question_answer filter-container__match-html\" style=\"display:none;\"><p>There are two types of aircraft mortgages: ordinary mortgages, which secure specified obligations, and revolving mortgages, which secure obligations within an agreed scope up to a pre-agreed maximum amount. An ordinary mortgage secures the principal of the obligation together with interest and default interest accrued during the two years preceding the commencement of a court-ordered sale. A revolving mortgage secures the principal together with interest and default interest up to the agreed maximum amount. For a revolving mortgage, crystallization of the secured obligations is required before enforcement.<\/p>\n<p>An aircraft mortgage may be created through an agreement between the mortgagor and the mortgagee. To establish an effective aircraft mortgage, the agreement must specify the aircraft subject to the mortgage and, in the case of an ordinary mortgage, the secured obligations, or in the case of a revolving mortgage, the scope of the secured obligations. There is no language requirement under Japanese law, nor is there a prescribed form for the mortgage agreement. However, for registration purposes, certain economic terms of the secured obligations must be specified.<\/p>\n<\/div>\r\n\r\n\r\n\t\t\t\t\t<\/li>\r\n\r\n\t\t\t\t\t\t\t\t\t<li class=\"question-block filter-container__element\">\r\n\t\t\t\t\t\t<h3 class=\"filter-container__match-html\">Are there any perfection requirements for such security document? If so, please state any conditions, procedural steps, formality requirements or documentation (for example, corporates, list of directors etc.) required to effect this<\/h3>\r\n\t\t\t\t\t\t<button id=\"show-me\">+<\/button>\r\n\t\t\t\t\t\t<div class=\"question_answer filter-container__match-html\" style=\"display:none;\"><p>Full registration of an aircraft mortgage perfects the mortgage against third parties (such as competing transferees, mortgagees, and bankruptcy trustees) and grants priority over subsequently registered security interests. A provisional registration also confers priority over later-registered security interests but must be converted into a full registration before the mortgage can be enforced.<\/p>\n<\/div>\r\n\r\n\r\n\t\t\t\t\t<\/li>\r\n\r\n\t\t\t\t\t\t\t\t\t<li class=\"question-block filter-container__element\">\r\n\t\t\t\t\t\t<h3 class=\"filter-container__match-html\">Summarize any captive insurance regime in your jurisdiction as applicable to aviation.<\/h3>\r\n\t\t\t\t\t\t<button id=\"show-me\">+<\/button>\r\n\t\t\t\t\t\t<div class=\"question_answer filter-container__match-html\" style=\"display:none;\"><p>There is no typical captive insurance regime. However, Japanese operators commonly place insurance in the local market. All Japanese insurance companies providing aviation coverage have formed the Japan Aviation Insurance Pool (JAIP). When a JAIP member underwrites aviation insurance, the policy is placed into the JAIP pool and allocated among members according to a predetermined ratio, after which reinsurance is arranged to cover the risk. JAiP also establishes the premium standards applicable to its members. Under the Insurance Business Act in Japan, a foreign insurer (an entity engaged in insurance business abroad in accordance with foreign laws) must establish a branch or other office in Japan and obtain a license from the Prime Minister in order to conduct insurance business in Japan. Foreign insurers that have not obtained such a license are, in principle, prohibited from entering into insurance contracts relating to aircraft registered in Japan.<\/p>\n<\/div>\r\n\r\n\r\n\t\t\t\t\t<\/li>\r\n\r\n\t\t\t\t\t\t\t\t\t<li class=\"question-block filter-container__element\">\r\n\t\t\t\t\t\t<h3 class=\"filter-container__match-html\">Are cut-through clauses under the insurance and reinsurance documentation legally effective in your jurisdiction?<\/h3>\r\n\t\t\t\t\t\t<button id=\"show-me\">+<\/button>\r\n\t\t\t\t\t\t<div class=\"question_answer filter-container__match-html\" style=\"display:none;\"><p>If a cut-through clause is governed by foreign law, a Japanese court would refer to that governing law to determine its effectiveness. If the clause is governed by Japanese law, it is treated as a &#8216;contract for the benefit of third parties.&#8217; Once the beneficiary (such as the insured or an additional insured under the primary insurance policy) expresses its intention to the reinsurer to exercise the benefit under the cut-through clause, the clause becomes binding on the reinsurer.<\/p>\n<\/div>\r\n\r\n\r\n\t\t\t\t\t<\/li>\r\n\r\n\t\t\t\t\t\t\t\t\t<li class=\"question-block filter-container__element\">\r\n\t\t\t\t\t\t<h3 class=\"filter-container__match-html\">Are there minimum requirements for the amount of third-party liability cover that must be in place in your jurisdiction?<\/h3>\r\n\t\t\t\t\t\t<button id=\"show-me\">+<\/button>\r\n\t\t\t\t\t\t<div class=\"question_answer filter-container__match-html\" style=\"display:none;\"><p>There are no specific minimum requirements for the amount of third-party liability cover whilst maintaining an appropriate third-party liability insurance is required for application of air transportation business\/ any business using aircraft.<\/p>\n<\/div>\r\n\r\n\r\n\t\t\t\t\t<\/li>\r\n\r\n\t\t\t\t\t\t\t\t\t<li class=\"question-block filter-container__element\">\r\n\t\t\t\t\t\t<h3 class=\"filter-container__match-html\">Can a mortgagee (or equivalent security interest holder) or lessor following an event of default under a mortgage (or equivalent security document) or lease, respectively, take possession of the aircraft without judicial intervention in your jurisdiction? Please also state any conditions, procedural steps, formality requirements or documentation (for example, original, legalized, translated Lease\/Mortgage, corporates etc.) required to effect this<\/h3>\r\n\t\t\t\t\t\t<button id=\"show-me\">+<\/button>\r\n\t\t\t\t\t\t<div class=\"question_answer filter-container__match-html\" style=\"display:none;\"><p>Japan is a jurisdiction where self-help remedies are not permitted. If the lessee refuses to return the aircraft to the lessor following lease termination, the lessor must initiate court proceedings to repossess the aircraft.<\/p>\n<p>To prevent the lessee from transferring possession of the aircraft to a third party and thereby obstructing repossession, the lessor may petition the competent court for a provisional remedy or injunction, known as a provisional disposition, which prohibits such transfer. Although the court fee for this procedure is nominal, the court may require the lessor to post a deposit to cover potential damages to the lessee. The court has discretion in determining whether a deposit is required and, if so, its amount.<\/p>\n<\/div>\r\n\r\n\r\n\t\t\t\t\t<\/li>\r\n\r\n\t\t\t\t\t\t\t\t\t<li class=\"question-block filter-container__element\">\r\n\t\t\t\t\t\t<h3 class=\"filter-container__match-html\">How can a mortgagee (or equivalent security interest holder), lessor under a lease or designee\/beneficiary of an IDERA deregister the aircraft? Please also state any conditions, procedural steps, formality requirements or documentation (for example, original, legalized, translated Lease\/Mortgage\/IDERA etc.) required to effect this<\/h3>\r\n\t\t\t\t\t\t<button id=\"show-me\">+<\/button>\r\n\t\t\t\t\t\t<div class=\"question_answer filter-container__match-html\" style=\"display:none;\"><p>An aircraft may be deregistered by the owner submitting an application for deregistration, together with the required supporting documents, to the Aeronautics Authority. When applying for deregistration, the owner must provide a consent letter from any party holding registered interests in the aircraft (such as a registered mortgagee), unless deregistration is mandatory due to total loss of the aircraft or failure to meet ownership requirements. Consequently, a registered mortgagee can block the proposed deregistration, whereas a lessee cannot, as leasehold interests are not registrable.<br \/>\nIf deregistration is required because ownership requirements are not satisfied, the Aeronautics Authority will notify the mortgagee and allow an opportunity to enforce the mortgage. The mortgagee will have three months to initiate enforcement proceedings, during which time the Aeronautics Authority will suspend deregistration.<\/p>\n<p>Exporting an aircraft from Japan requires obtaining an export permit from the Director General of Customs. The application must include supporting documents such as the relevant invoice and any permits, approvals, and certificates required under export and other applicable laws and regulations. Consent from the mortgagee or operator is not required for export. However, if the aircraft is to be exported to certain restricted countries, export permission from the Ministry of Economy, Trade and Industry may be required under the Foreign Exchange and Foreign Trade Act (Act No. 228 of 1949).<\/p>\n<\/div>\r\n\r\n\r\n\t\t\t\t\t<\/li>\r\n\r\n\t\t\t\t\t\t\t\t\t<li class=\"question-block filter-container__element\">\r\n\t\t\t\t\t\t<h3 class=\"filter-container__match-html\">Can the government or the lessee lawfully prevent the repossession or deregistration and if so, in what circumstances<\/h3>\r\n\t\t\t\t\t\t<button id=\"show-me\">+<\/button>\r\n\t\t\t\t\t\t<div class=\"question_answer filter-container__match-html\" style=\"display:none;\"><p>As stated in the response to question 19, an export permit from the Director General of Customs is required for the export of an aircraft; therefore, denying such permit can lawfully prevent export. However, as also stated in the response to question 19, the lessee is not a registered interest holder and thus cannot prevent deregistration.<\/p>\n<\/div>\r\n\r\n\r\n\t\t\t\t\t<\/li>\r\n\r\n\t\t\t\t\t\t\t\t\t<li class=\"question-block filter-container__element\">\r\n\t\t\t\t\t\t<h3 class=\"filter-container__match-html\">If judicial intervention is required, please describe the process? Please also state any procedural steps, length of time to complete and advise as to documentation required<\/h3>\r\n\t\t\t\t\t\t<button id=\"show-me\">+<\/button>\r\n\t\t\t\t\t\t<div class=\"question_answer filter-container__match-html\" style=\"display:none;\"><p>Please refer to the response to question 18.<\/p>\n<\/div>\r\n\r\n\r\n\t\t\t\t\t<\/li>\r\n\r\n\t\t\t\t\t\t\t\t\t<li class=\"question-block filter-container__element\">\r\n\t\t\t\t\t\t<h3 class=\"filter-container__match-html\">How is legal title transferred under the laws of your jurisdiction? Please also state any conditions, procedural steps, formality requirements or documentation (for example, corporates etc.) required to effect this<\/h3>\r\n\t\t\t\t\t\t<button id=\"show-me\">+<\/button>\r\n\t\t\t\t\t\t<div class=\"question_answer filter-container__match-html\" style=\"display:none;\"><p>Title to an aircraft is transferred through the seller&#8217;s disposition, typically evidenced by a bill of sale. Registration of an ownership interest in an aircraft perfects the transfer against third parties, such as competing transferees and bankruptcy trustees.<\/p>\n<p>Consequently, a transferee cannot assert ownership if another party completes registration of a competing transfer first.<\/p>\n<p>Although registration requires multiple supporting documents, which enhance the reliability of the aircraft registry, its accuracy is not officially guaranteed. Therefore, as a general rule, a person who purchases an aircraft from a seller who is not the true owner does not acquire valid ownership, even if that seller is listed as the registered owner in the aircraft registry.<\/p>\n<\/div>\r\n\r\n\r\n\t\t\t\t\t<\/li>\r\n\r\n\t\t\t\t\t\t\t\t\t<li class=\"question-block filter-container__element\">\r\n\t\t\t\t\t\t<h3 class=\"filter-container__match-html\">Are there any restrictions on the sale of an aircraft following enforcement (for example, the requirement to obtain a court order or conduct a public auction or other action in order to sell the aircraft upon enforcement)<\/h3>\r\n\t\t\t\t\t\t<button id=\"show-me\">+<\/button>\r\n\t\t\t\t\t\t<div class=\"question_answer filter-container__match-html\" style=\"display:none;\"><p>Self-help remedies are not permitted in Japan. If the owner and, where different, the operator cooperate with the mortgagee, the mortgagee may sell the aircraft to a third party or retain it and apply the sale proceeds (or fair value) to the secured obligations, provided such action is permitted under the mortgage agreement. Otherwise, the mortgagee must initiate court proceedings to foreclose the mortgage through a public sale supervised by the court (a court sale).<\/p>\n<p>To commence a court sale, the mortgagee must file an application for foreclosure of security interests along with supporting documents, including an official transcript of the aircraft registry. Once the court sale procedure begins, the court will instruct an enforcement officer to seize the certificate of registration, the certificate of airworthiness, and other documents kept on board to detain the aircraft and enable the sale. Even before filing for foreclosure, the mortgagee may petition the court for an order of detention if it appears that repossession would otherwise be difficult. Unless an objection is raised to the commencement order, the court sale may proceed, and the aircraft can be detained by way of an ex parte application.<\/p>\n<p>The owner may hinder enforcement by refusing to cooperate, making a private sale impracticable even if permitted under the mortgage agreement. In such cases, the mortgagee must resort to a court sale procedure.<\/p>\n<\/div>\r\n\r\n\r\n\t\t\t\t\t<\/li>\r\n\r\n\t\t\t\t\t\t\t\t\t<li class=\"question-block filter-container__element\">\r\n\t\t\t\t\t\t<h3 class=\"filter-container__match-html\">Would lease rentals be subject to tax (for example, withholding or income tax)? Please also state if there are any conditions for such tax to be imposed and any steps usually taken to mitigate this<\/h3>\r\n\t\t\t\t\t\t<button id=\"show-me\">+<\/button>\r\n\t\t\t\t\t\t<div class=\"question_answer filter-container__match-html\" style=\"display:none;\"><p>Lease rental payments by a Japanese party to a non-Japanese party may be subject to Japanese withholding tax. However, exemption of withholding tax may apply pursuant to a double taxation treaty between Japan and the recipient&#8217;s jurisdiction.<\/p>\n<\/div>\r\n\r\n\r\n\t\t\t\t\t<\/li>\r\n\r\n\t\t\t\t\t\t\t\t\t<li class=\"question-block filter-container__element\">\r\n\t\t\t\t\t\t<h3 class=\"filter-container__match-html\">Would a sale of an aircraft in your jurisdiction incur sales tax? Please also provide details of amount or calculation and any steps usually taken to mitigate this<\/h3>\r\n\t\t\t\t\t\t<button id=\"show-me\">+<\/button>\r\n\t\t\t\t\t\t<div class=\"question_answer filter-container__match-html\" style=\"display:none;\"><p>The sale of an aircraft may be subject to Japanese consumption tax (which is a tax similar to value added tax and currently is imposed at the rate of 10 per cent of the purchase price or each rent) if such sale is &#8216;conducted in Japan.&#8217; Whether such sale is conducted in Japan will be determined by the location of the aircraft registry. Even if a sale of an aircraft is deemed to be conducted in Japan, certain exports from Japan are exempt from Japanese consumption taxes.<\/p>\n<\/div>\r\n\r\n\r\n\t\t\t\t\t<\/li>\r\n\r\n\t\t\t\t\t\t\t\t\t<li class=\"question-block filter-container__element\">\r\n\t\t\t\t\t\t<h3 class=\"filter-container__match-html\">Are there any restrictions on the import or export of aircraft in your jurisdiction and would such importation or exportation incur any liability as to customs or taxes? Please also state if any consents or approvals are required and the procedural steps taken to obtain these, and any procedural steps or formality requirements to mitigate any taxes<\/h3>\r\n\t\t\t\t\t\t<button id=\"show-me\">+<\/button>\r\n\t\t\t\t\t\t<div class=\"question_answer filter-container__match-html\" style=\"display:none;\"><p>Both the export and import of aircraft require authorization from the Director General of Customs. To obtain such authorization, the applicant must declare details such as the name, quantity, and price of the goods (for imported goods, the quantity and price serving as the tax base) and undergo the necessary inspections.<\/p>\n<p>Additionally, when exporting an aircraft to regions other than those specified by law in Japan, authorization from the Minister of Economy, Trade and Industry is also required. No fees or charges are required to apply for an import or export permit for a commercial aircraft from the Director General of Customs. However, the import of an aircraft into Japan is subject to import consumption taxes imposed on the importing entity. If the importer or exporter engages a customs agent, fees for the customs agent will apply.<\/p>\n<\/div>\r\n\r\n\r\n\t\t\t\t\t<\/li>\r\n\r\n\t\t\t\t\t\t\t\t\t<li class=\"question-block filter-container__element\">\r\n\t\t\t\t\t\t<h3 class=\"filter-container__match-html\">Are there any foreign exchange restrictions on transfers of funds<\/h3>\r\n\t\t\t\t\t\t<button id=\"show-me\">+<\/button>\r\n\t\t\t\t\t\t<div class=\"question_answer filter-container__match-html\" style=\"display:none;\"><p>Under the Foreign Exchange and Foreign Trade Act, certain payments or money transfers exceeding \u00a530 million between Japan and foreign countries may require routine ex post facto reporting to the Minister of Finance through the Bank of Japan. Except where such payments violate international or domestic sanctions, regular commercial payments in aviation financing or lease transactions are not subject to any approval or prior notification requirements.<\/p>\n<\/div>\r\n\r\n\r\n\t\t\t\t\t<\/li>\r\n\r\n\t\t\t\t\t\t\t\t\t<li class=\"question-block filter-container__element\">\r\n\t\t\t\t\t\t<h3 class=\"filter-container__match-html\">How successful have foreign creditors and lessors been in enforcing their security and lessor rights over and successfully repossessing aircraft in a timely manner?<\/h3>\r\n\t\t\t\t\t\t<button id=\"show-me\">+<\/button>\r\n\t\t\t\t\t\t<div class=\"question_answer filter-container__match-html\" style=\"display:none;\"><p>We are not aware of any specific difficulties or constraints affecting foreign creditors in Japan. However, a Japanese translation must be submitted to the court in order to commence court proceedings in connection with enforcing the security and lessor rights.<\/p>\n<\/div>\r\n\r\n\r\n\t\t\t\t\t<\/li>\r\n\r\n\t\t\t\t\t\t\t\t\t<li class=\"question-block filter-container__element\">\r\n\t\t\t\t\t\t<h3 class=\"filter-container__match-html\">What government led reforms affecting creditor and lessor rights are currently underway in the aviation sector in your jurisdiction?<\/h3>\r\n\t\t\t\t\t\t<button id=\"show-me\">+<\/button>\r\n\t\t\t\t\t\t<div class=\"question_answer filter-container__match-html\" style=\"display:none;\"><p>N\/A<\/p>\n<\/div>\r\n\r\n\r\n\t\t\t\t\t<\/li>\r\n\r\n\t\t\t\t\t\t\t\t\t<li class=\"question-block filter-container__element\">\r\n\t\t\t\t\t\t<h3 class=\"filter-container__match-html\">Please describe any interesting legal development in your jurisdiction (for instance, decided court cases or arbitral awards) which affect creditor and lessor rights?<\/h3>\r\n\t\t\t\t\t\t<button id=\"show-me\">+<\/button>\r\n\t\t\t\t\t\t<div class=\"question_answer filter-container__match-html\" style=\"display:none;\"><p>N\/A<\/p>\n<\/div>\r\n\r\n\r\n\t\t\t\t\t<\/li>\r\n\r\n\t\t\t\t\t\t\t\t\t<li class=\"question-block filter-container__element\">\r\n\t\t\t\t\t\t<h3 class=\"filter-container__match-html\">Please discuss any relevant governmental regulations implemented in your country to help alleviate the financial and other difficulties faced by airlines in your jurisdiction caused by CoVid 19 and whether that will impact rights of lessors (who lease aircraft to the airlines) and lenders (who finance such aircraft which are mortgaged in favour of the lenders)? Are such governmental regulations expected to be in place until the difficulties faced by airlines caused by the CoVid 19 subside or are they more long term?<\/h3>\r\n\t\t\t\t\t\t<button id=\"show-me\">+<\/button>\r\n\t\t\t\t\t\t<div class=\"question_answer filter-container__match-html\" style=\"display:none;\"><p>N\/A<\/p>\n<\/div>\r\n\r\n\r\n\t\t\t\t\t<\/li>\r\n\r\n\t\t\t\t\r\n<div class=\"word-count-hidden\" style=\"display:none;\">Estimated word count: <span class=\"word-count\">4288<\/span><\/div>\r\n\r\n\t\t\t<\/ol>\r\n\r\n<script type=\"text\/javascript\" src=\"\/wp-content\/themes\/twentyseventeen\/src\/jquery\/components\/filter-guides.js\" async><\/script><\/div>"}},"_links":{"self":[{"href":"https:\/\/my.legal500.com\/guides\/wp-json\/wp\/v2\/comparative_guide\/121160","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/my.legal500.com\/guides\/wp-json\/wp\/v2\/comparative_guide"}],"about":[{"href":"https:\/\/my.legal500.com\/guides\/wp-json\/wp\/v2\/types\/comparative_guide"}],"wp:attachment":[{"href":"https:\/\/my.legal500.com\/guides\/wp-json\/wp\/v2\/media?parent=121160"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}