JAPAN Law and Practice Contributed by: Taro Omoto, Yusuke Nakajima and Makoto Sakai, Mori Hamada & Matsumoto
suant to the Act on Special Provisions, etc, of the Civil Code Concerning the Perfection Requirements for the Assignment of Movables and Claims. 3.2.10 Transfer of Security Interests Over Aircraft/ Engines The transfer of security interests over an aircraft and engines is recognised. 3.2.11 Effect of Changes in the Identity of Secured Parties Where a security trust structure (or a parallel debt structure) is adopted, the security interests continue to be validly held by the security trustee even if there is a change of lender (due to an assignment of its loan claims). Where a security trust structure is not adopted, if a lender transfers its loan claims, the pro - cedures relating to the transfer of the security interest must also be carried out. 3.2.12 “Parallel Debt” Structures A parallel debt structure is possible under Japanese law, but it is rarely used in domestic transactions; see also 3.2.3 Trust/Trustee Concepts . 3.2.13 Effect of Security Assignments on Residence of Secured Parties A foreign lessor is not generally deemed to have a permanent establishment in Japan just because it is a party to a security assignment. 3.2.14 Perfection of Domestic Law Mortgages An aircraft mortgage under Japanese law is perfected upon registration of the aircraft mortgage in the air - craft register, pursuant to the Aircraft Mortgage Act. 3.2.15 Differences Between Security Over Aircraft and Spare Engines It is not possible to create an aircraft mortgage over the engines only. In practice, instead of an aircraft mortgage, a security assignment ( joto-tanpo ) is avail - able for engines. Please see 3.2.14 Perfection of Domestic Law Mortgages regarding perfection. A security assignment over an engine is perfected upon delivery or a registration of assignment of mova - bles pursuant to the Act on Special Provisions, etc,
of the Civil Code Concerning the Perfection Require - ments for the Assignment of Movables and Claim. 3.2.16 Form and Perfection of Security Over Bank Accounts A pledge is usually used to take security over a bank account. In practice, an account pledge is perfected by consent from the account bank with a certified date stamped by a notary public. 3.3 Liens 3.3.1 Third-Party Liens Unlike ships, there are no specific statutory liens ( saki- dori tokken ) for aircraft or engines under Japanese law. The ordinary statutory liens for movable property apply to aircraft or engines, but a third party cannot register these liens over an aircraft or engine. If there are competing statutory liens on the aircraft that is subject to the aircraft mortgage, the priority of the aircraft mortgage is equal to the first priority statutory liens under the Civil Code. The first priority statutory liens under the Japanese Civil Code are statutory liens for leases of immovables, lodging at hotels and trans - portation, which are unlikely to arise on the aircraft. 3.3.2 Timeframe to Discharge a Lien or Mortgage A statutory lien or aircraft mortgage is extinguished when the relevant secured obligations are paid in full. The standard period of time for processing the dereg - istration of an aircraft mortgage is one week from the date of application. 3.3.3 Register of Mortgages and Charges An aircraft mortgage can be registered in the aircraft registry. Registration of an aircraft mortgage operates as perfection against a third party. 3.3.4 Statutory Rights of Detention or Non- Consensual Preferential Liens Pursuant to the Commercial Code (Act No 48 of 9 March 1899), if performance is due on a claim arising between merchants from an action that constitutes a commercial transaction for both parties, a creditor may retain an object belonging to the debtor that the creditor has gained possession of in the commercial transaction with the debtor, until the claim is satis - fied. Please see 3.3.1 Third-Party Liens regarding non-consensual preferential liens.
343 CHAMBERS.COM
Powered by FlippingBook