IN GIFT IFSC

OVERVIEW

• The International Financial Services Centres Authority (IFSCA) has introduced an amendment to the ‘Framework for Aircraft Lease’ to address transactions involving person(s) resident in India.
• The primary objective of this amendment is to facilitate the purchase of aircraft and related assets by Lessors in IFSC from manufacturers located in India.

KEY AMENDMENTS

• A significant change introduced by the amendment is the revision of Clause O.2, which pertains to transactions with person(s) resident in India.
• Under the revised clause, Lessors in IFSC are generally prohibited from acquiring assets intended solely for use by or to provide services to Indian residents.

EXCEPTIONS TO RESTRICTIONS

Lessors in IFSC are generally prohibited from acquiring assets for use by Indian residents, except when:

• The asset is acquired from a person or entity that is not a ‘Group Entity’ of the Lessor,
• The acquisition is part of a sale and leaseback arrangement for assets being imported into India for the first time, or
• The asset is purchased directly from a manufacturer based in India.

Provisions for Market Stability

• The amendment to the ‘Framework for Aircraft Lease’ permits sale and leaseback for new imports, promoting collaboration and market access.
• This regulatory shift is expected to boost India’s position as a key player in the global aircraft leasing industry while ensuring robust compliance and transparency.
• Stakeholders must align with the revised guidelines to seize opportunities and support aircraft leasing growth.