JAPAN Law and Practice Contributed by: Taro Omoto, Yusuke Nakajima and Makoto Sakai, Mori Hamada & Matsumoto
Mori Hamada & Matsumoto Marunouchi Park Building 2-6-1 Marunouchi Chiyoda-ku Tokyo, 100-8222 Japan
Tel: +81 362 128 330 Fax: +81 362 128 230
Email: info@morihamada.com Web: www.morihamada.com/en
1. Aircraft and Engine Purchase and Sale 1.1 Sales Agreements 1.1.1 Taxes/Duties Payable Upon Execution of the Sales Agreement An aircraft sale and purchase agreement is subject to stamp duty if it is executed in Japan, while an engine sale agreement or a sale of an ownership interest in an entity is not subject to stamp duty. Stamp duty does not apply if the agreement is executed outside Japan, even if it is executed by a Japanese party. 1.1.2 Enforceability Against Domestic Parties An aircraft sale and purchase agreement is not required to be translated, certified, notarised or legal - ised to be enforceable against a Japanese party. However, if a party submits the agreement to the court as evidence, a Japanese translation must be attached. 1.2 Transfer of Ownership 1.2.1 Transferring Title Ownership of an aircraft or engine (including all installed parts) is transferred upon an agreement between a seller and a buyer. In order to perfect the transfer of an aircraft against a third party, registration in the aircraft register maintained by the Japan Civil Aviation Bureau (JCAB) of the Ministry of Land, Infra - structure, Transport and Tourism (MLIT) is required. There is no equivalent registration system for inde - pendent engines. If ownership of an engine is trans - ferred separately, transfer of possession of the engine or a registration of assignment of movables pursu -
ant to the Act on Special Provisions, etc, of the Civil Code Concerning the Perfection Requirements for the Assignment of Movables and Claims (Act No 104 of 12 June 1998) is required for perfection against a third party. The sale of the ownership interest in an entity that owns an aircraft or engine is not effectively recognised as a sale of such aircraft or engine itself. 1.2.2 Sales Governed by English or New York Law Under the Act on General Rules for Application of Law (Act No 78 of 21 June 2006), which is a statute of Japanese conflict of laws rules, the transfer of owner - ship of property is mandatorily governed by the law of the place where the property is located, while the parties can, in principle, freely choose the governing law of the transfer agreement itself. In the case of the aircraft, “the place where the property is located” is generally interpreted as ”the jurisdiction where the aircraft is registered”. Therefore, if the subject aircraft is registered in Japan or the subject engine is located in Japan, that choice will be disregarded with respect to the transfer of ownership, even if the parties choose English law or New York law for the governing law of the sale agreement. However, as explained in 1.2.1 Transferring Title , the transfer is effective under Japanese law as long as the transfer of ownership is agreed between the par - ties. As a result, even if English law or New York law is chosen as the governing law of the sale and pur - chase agreement, the ownership can usually be validly transferred.
331 CHAMBERS.COM
Powered by FlippingBook