Security document (mortgage) form and content

What is the typical form of a security document over the aircraft and what must it contain?

The typical form of a security document over the aircraft is an aeronautical mortgage, which may be executed by public deed or by private instrument, with the signatures certified by notary public or judicial authority. There is no specific form, although the provisions of the mortgages contain standard language. It must be drafted in Spanish language and it can provide either a maximum secured amount or a fixed amount. Mortgages are required to be self-sufficient for enforcement purposes, and thus it must contain all the relevant terms of the deal (principal, interest, repayment dates). In this sense, a mortgage public deed or private instrument tends to incorporate within the text a transcription of the loan agreement secured by the mortgage.

Security documentary requirements and costs

What are the documentary formalities for creation of an enforceable security over an aircraft? What are the documentary costs?

To create an enforceable security over an aircraft it is necessary to execute a mortgage public deed with the intervention of a notary public or a private instrument with the signatures certified by notary public or judicial authority. The costs involved in granting a mortgage by public deed are the fees and costs of the notary public, which are usually between 0.5 per cent and 1 per cent of the amount secured by the mortgage. Those executed by private instrument only involve the cost of the legalisation of the signatures. Professional fees are levied by the VAT of 21 per cent. The stamp tax applicable to the loan agreement (1 per cent) that is secured by the mortgage over the aircraft must also be considered.

The granting of a mortgage also requires that the notary public obtains ownership certificates of the aircraft concerned before executing the respective public deed.

Security registration requirements

Must the security document be filed with the aviation authority or any other registry as a condition to its effective creation or perfection against the debtor and third parties? Summarise the process to register a mortgagee interest.

Yes, the mortgage public deed must be filed with the Aircraft Registry to be effective as regards third parties.

To register a mortgage with the Aircraft Registry at the National Administration of Civil Aviation, it is necessary to file the following documentation:

  • a mortgage public deed (testimony issued by a notary public) or the private instrument with the signatures certified by notary public or judicial authority;
  • Form 101-C;
  • a registration fee receipt;
  • the tax registration form of the buyer;
  • a money laundering and terrorist financing prevention form;
  • the certificate of Personal Entries of the mortgagor, requested by notary public before the Real Estate Registry;
  • a copy of the aircraft insurance policy; and
  • a filing note detailing the attached documentation.


The forms must include certified signatures and legalisation or apostille if executed abroad.

The registration fee to be paid to the Aircraft Registry is 0.3 per cent of the amount of the loan, and the estimated time for completion is one month.

Registration of security

How is registration of a security interest certified?

Once the process to register a mortgage is complete, the Aircraft Registry returns a copy of the mortgage public deed with an extract attached to it, certifying the registration. It is also possible to request domain certificates evidencing all the security interest annotated over the aircraft and their priority rank.

Effect of registration of a security interest

What is the effect of registration as to third parties?

Once registered, a mortgage is effective with regard to third parties. The priority is established in the public mortgage deed, as it is possible to grant a mortgage in first grade (highest priority), second grade, etc. Third parties can rely on the accuracy of the public registration of the security interest, either through the original registration certificate or in subsequent domain certificates requests. In general, the priority is granted by the date of registration of the mortgage deed.

Security structure and alteration

How is security over aircraft and leases typically structured? What are the consequences of changes to the security or its beneficiaries?

The most extended security structure in Argentina is the mortgage over the aircraft, notwithstanding that in lease agreements (both the financial leasing with a purchase option or a rental agreement) the aircraft still belongs to the creditor, and, therefore, it is not possible for the debtor to grant a mortgage over the aircraft. The concept of the trust is recognised under Argentine law, and in the case of a mortgage, a trust can be registered as the mortgagee or the mortgagor.

Any change over the security, its beneficiaries, and its assignment or transfer must be expressly allowed within the provisions of the mortgage, and the necessary amendments over the public mortgage deed will have to be registered with the Aircraft Registry (changes with respect to the parties, amount, etc).

A mortgage is a right in rem, which is enforced over the aircraft. According to Argentine law, a mortgagor does not recover the aircraft when enforcing a mortgage, but instead must obtain a judicial order to conduct an auction of the aircraft. A mortgagee is entitled to participate as a bidder in the auction to acquire the aircraft, compensating the purchase price with its credit against the owner of the aircraft.

Security over spare engines

What form does security over spare engines typically take and how does it operate?

Mortgages can be granted over spare engines, in the same terms they are granted over aircrafts, via a mortgage public deed with the intervention of a notary public. Usually, a mortgage public deed over an aircraft also identifies the security over its spare engines, but it can be granted in a separate deed, particularly if the engine is not installed on a host aircraft.

If a mortgage comprises both the aircraft and the engine, then it is likely that both will be treated as a single item of property in the auction, but it is possible to enforce them separately as well. An encumbered engine would not cease to be encumbered on another aircraft, and the security interest over it would remain effective.