These Rules are designed to address long-standing enforcement gaps. While the Act establishes the substantive legal framework, the Rules provide the operational mechanism for its implementation.

India’s civil aviation market is currently the fastest growing market and ranks as the third largest globally. In span of last few years, the domestic carriers in India have placed an unprecedent orders for hundreds of aircrafts with international manufacturers involving financial commitments running into billions of dollars.1 This extraordinary expansion has positioned India as one of the most significant markets for global aircraft manufacturers, lessors, and financiers.

But commercial growth alone is not enough. Capital follows confidence and that requires legal certainty, the assurance that if an investment goes wrong, the law will provide a reliable, timely, and effective remedy. For too long, India’s aviation finance framework failed to provide that assurance. Foreign creditors who leased aircraft to Indian airlines found themselves trapped in protracted litigation when airlines defaulted, watching asset values erode while courts slowly worked through disputes that should have been resolved in weeks.

These Rules are designed to address long-standing enforcement gaps. While the Act establishes the substantive legal framework, the Rules provide the operational mechanism for its implementation. Together, they mark a structural shift in India’s aviation financing regime, aligning it with global best practices and transforming India from a jurisdiction approached with caution by international aircraft financiers into one offering greater legal certainty and creditor confidence.

Under the Act and Rules thereof, the Directorate General of Civil Aviation (DGCA) records, facilitates and enforces creditor rights by recording irrevocable deregistration and export request authorisations (IDERAs), deregistering aircraft on creditor request within prescribed timelines, and enabling their export in line with the Cape Town Convention.

According to the Rules, the Aviareto2 in Dublin operates the International Registry under the Cape Town Convention, a global electronic system that records ownership and security interests in aircraft and determines creditor priority on a first-to-file basis, ensuring legal certainty in cross-border aviation finance. In other words, all interests, whether arising from ownership, security arrangements, lease agreements or financial accommodations, etc. through which rights over an aircraft are created in favour of creditors worldwide, are required to be registered on this International Registry. Once registered, such interests are formally recorded and maintained by Aviareto, gives priority to the creditor’s rights over others, across jurisdictions to establish, protect, and enforce their rights under the Convention framework.