The Accession Law provides for Russia’s accession to the Convention and the Protocol with declarations under article 39(1) (a), article 39(1) (b), article 53 and article 54(2) of the Convention; and article XXX(3) of the Protocol.
See below for an English translation (unofficial) of the declarations.
Russia has nominated its state arbitrazh courts (commercial courts in Russia) as relevant courts for disputes involving the Convention and the Protocol.
International aircraft financiers and lessors will welcome Russia’s declarations permitting self-help remedies (article 54(2)), and electing Alternative A for all types of insolvency proceeding (for the purpose of article XI of the Protocol) and providing for 60 days’ waiting period (article XXX(3) of the Protocol). However, Russia has failed to make a number of other key declarations.
Russia has failed to make a declaration (article XXX(1) of the Protocol) concerning article XIII of the Protocol on de-registration and export request authorisations.
Russia has also failed to make a declaration (article XXX(1)) concerning article VIII of the Protocol on choice of law.
Without these additional declarations, the Accession Law fails to comply with the requirements in the OECD Aircraft Sector understanding for a reduced premium to apply for export credit financing. The Accession Law can be seen, therefore, as a missed opportunity to improve access to export credit financing for Russian airlines.
It remains to be seen whether Russia will make further declarations or change its Accession Law in the future.
Other than the missed opportunity to comply with the OECD requirements, Russia’s failure to make these declarations will have little, if any, negative impact on Russian airlines. In practice, each of the above two declarations would be relevant primarily to transactions with aircraft registered in the contracting state – whereas most aircraft operated by Russian airlines are held through offshore companies and are registered outside Russia (in Bermuda, for example). We do not expect that practice to change as a result of Russia acceding to the Convention and the Protocol.