Russia law raises stakes for lessors rushing to recover aircraft

Russia on Monday passed a law allowing foreign aircraft leased by its airlines to be added to the country’s domestic register, a move that will increase difficulties for western lessors, who have been scrambling to repossess their planes. The bill, signed by President Vladimir Putin, says it aims to “ensure the uninterrupted functioning of civil aviation and . . . at keeping foreign aircraft with Russian carriers,” according to an update published on the government’s website. The new law comes after regulators in Bermuda, where most of Russia’s foreign-owned commercial jets are registered, said they were suspending airworthiness certificates on the aircraft from Sunday over concerns they were no longer able to guarantee that they were safe. Before western sanctions were imposed, non-Russian lessors had 515 planes in Russia, with a combined market value of close to $10bn, according to data from aviation consultancy Cirium. The Bermuda Civil Aviation Authority said that international sanctions on aviation following Russia’s invasion of Ukraine have had a “significant impact on the ability to sustain safety oversight on Russian operated aircraft on the Bermuda Aircraft Registry”. Phil Seymour, president at aviation consultancy IBA, said there was “justifiable concern in the industry about the level of compliance in Russia with international aviation law”, adding that there was a risk that “airlines may fly aircraft within Russia, regardless of where they are registered”. “The Bermudans had no choice,” said another industry expert. “Given that the manufacturers, Boeing and Airbus, had cut off access to Russian carriers in terms of maintenance and the provision of spare parts, it was logical that Bermuda’s regulator would no longer be able to guarantee the airworthiness of the aircraft.” Story has more.<br/>