MADAGASCAR Law and Practice Contributed by: Claudy Monja and Sarah Razafindrafito, John W Ffooks & Co
3. Aircraft Debt Finance 3.1 Structuring 3.1.1 Restrictions on Lending and Borrowing There are no restrictions on foreign lenders financ - ing an aircraft locally, or on borrowers using the loan proceeds. 3.1.2 Effect of Exchange Controls or Government Consents There are no exchange controls or government con - sents required in respect of financing or repatriation of realisation proceeds under a loan, guarantee or security document. 3.1.3 Granting of Security to Foreign Lenders Borrowers are permitted to grant security to foreign lenders. 3.1.4 Downstream, Upstream and Cross-Stream Guarantees Downstream, upstream and/or cross-stream guaran - tees are not permitted under Malagasy law. 3.1.5 Lenders’ Share in Security Over Domestic SPVs Taking share security over a domestic special-pur - pose vehicle (SPV) that owns the financed aircraft is possible, but this kind of situation has not yet arisen. Pledges over shares are permitted. 3.1.6 Negative Pledges Negative pledges are recognised. 3.1.7 Intercreditor Arrangements There are no material restrictions or requirements imposed on intercreditor arrangements. 3.1.8 Syndicated Loans While the concept of agency and the role of an agent (such as the facility agent) under a syndicated loan does not exist per se in Madagascar, from a practi - cal perspective, this concept is recognised. In addi - tion, the Malagasy Contract Law gives free rein to the parties to establish the terms and conditions of their contract. This includes the right to appoint an entity or an individual as an agent.
2.10 Cape Town Convention and Others 2.10.1 Conventions in Force The Convention on International Interests in Mobile Equipment (the “Convention”) and the related Pro - tocol on Matters specific to Aircraft Equipment (the ”Protocol”) are in force in Madagascar. There is no implementing local legislation, but the Convention and Protocol are applicable and enforceable in Madagas - car, as the adherence of the Republic of Madagascar was authorised by Law No 2012-009. However, Madagascar has not designated an “entry point” pursuant to Article XIX of the Protocol. 2.10.2 Declarations Made Concerning Conventions At the time of Madagascar’s adherence to the Con - vention, the Republic of Madagascar made declara - tions in respect of Articles 39 (1) (a) and (b), 40, 53 and 54 (2). At the time of Madagascar’s adherence to the Proto - col, the Republic of Madagascar made declarations • Article XXX (1) relating to Article XII and Article XIII. 2.10.3 Application of Article XIII of the Protocol on Matters Specific to Aircraft Equipment Article XIII of the Protocol is applicable in Madagas - car. There is no specific procedure for the submission and recording of an IDERA on the Aircraft Register. The most important action is that the IDERA is filed with the CAA (which is in charge of the records in the Aircraft Register). 2.10.4 Enforcement of Conventions There is no known precedent of enforcement of the Convention or the Protocol in Madagascar. 2.10.5 Other Conventions Madagascar is a party to the 1948 Geneva Convention on the International Recognition of Rights in Aircraft, but not to the 1933 Rome Convention for the Unifi - cation of Certain Rules relating to the Precautionary Arrest of Aircraft. in respect of the following articles: • Article XXX (1) relating to Article VIII; • Article XXX (2) relating to Article X; • Article XXX (3) relating to Article XI; and
380 CHAMBERS.COM
Powered by FlippingBook