Department of Economic Affairs notifies financial products for International Financial Services

The Department of Economic Affairs has notified that operating leases, financial leases and any hybrid of operating and financial leases for aircraft, helicopters, engines or any other parts will be treated as “financial products” under the existing legal framework for international financial services (IFSs). The IFS Centres Authority, which is the sole regulator for economic activities in IFSs, is now expected to frame regulations on aircraft leasing and spell out criteria for players who would be allowed to undertake aircraft lease financing. This is expected to pave the way for “onshoring” aircraft leasing and financing, which is the most profitable segment of the aviation value chain, and support local carriers that have placed orders for more than 1,000 aircraft.