Enforcement measuresRepossession following lease termination
Outline the basic repossession procedures following lease termination. How may the lessee lawfully impede the owner’s rights to exercise default remedies?
The return of an aircraft lessor or owner at the end of the lease term, or otherwise upon termination or following the occurrence of an event of default, does not require the consent or approval of, the giving of notice to, the registration with, or the taking of any other action in respect of any government entity of Mexico. It does not contravene any laws of Mexico. However, if a lessee does not return the aircraft voluntarily, a court order based on a final judgment will be required in order to retrieve possession of the same.
The following are the deregistration criteria established in article 46 of the Civil Aviation Law:
The cancellation of the registration marks of an aircraft before the Mexican Aeronautic Registry will have as a consequence the loss of its Mexican nationality and may be made in the following cases:
- at the written request of the owner or person in legitimate possession of the aircraft. The deregistration of an aircraft with a registered lien will not take place, without the consent of the person that holds such lien;
- through a judicial order or an order of other competent authority;
- in case of destruction, loss or abandonment of the aircraft;
- for the conclusion of the term of a temporary registration;
- for the registration of the aircraft in another country; and
- for any of the events described in the respective regulations.
The registration certificate is a relevant element or document that is always requested by the DGAC to proceed with a deregistration request. This document is therefore always delivered to the lessee; therefore it is important to have physical possession of such document.
No self-help remedies are available in Mexico.Enforcement of security
Outline the basic measures to enforce a security interest. How may the owner lawfully impede the mortgagee’s right to enforce?
Self-help remedies are not available in Mexico. A court order must be obtained to detain an aircraft. An aircraft cannot be detained by an ex parte application.Priority liens and rights
Which liens and rights will have priority over aircraft ownership or an aircraft security interest? If an aircraft can be taken, seized or detained, is any form of compensation available to an owner or mortgagee?
The obligation to pay rent under a lease or sublease is the direct and unconditional general obligation of a Mexican operator, and will rank in right of payment at least pari passu with all unsecured debt of the Mexican operator.
A Mexican operator is subject to civil and commercial law, and its actions constitute private and commercial acts. Neither the operator nor any of its revenues, properties or assets enjoys any right of immunity from suit, set-off or attachment upon or prior to judgment or in aid of execution in respect of its obligations under a lease or a sublease transaction.
Employee rights and tax liabilities have priority under Mexican legislation.
If the ownership or a mortgage has been duly filed before the Mexican Aeronautic Registry, and the operator does not have any potential or partial ownership or property rights on an aircraft, the equipment may be repossessed.
An aircraft may not be confiscated, seized or detained for any reason whatsoever, unless the aircraft is involved in a criminal action (eg, drug trafficking).Enforcement of foreign judgments and arbitral awards
How are judgments of foreign courts enforced? Is your jurisdiction party to the 1958 New York Convention?
In Mexico the recognition and enforcement of foreign judgments is valid through international private law principals, Mexican federal law and the state laws.
The court may be denied if (i) the defendant was not given proper notice; (ii) additional legal matters are pending between the parties regarding the same litis; (iii) its contrary to the public order; (iv) the judgment involves an in rem action; or (v) lack of reciprocity of the country of issuance of the judgment regarding the enforceability and recognition of foreign judgments.
Mexico and Spain executed a bilateral agreement regarding the execution and enforcement of foreign judgments.
Local and federal courts have valid jurisdiction over an application for recognition and enforcement of arbitral awards in accordance with article 1422 of the Commerce Code, as set forth in the UNCITRAL Model Law on International Commercial Arbitration.
As established in question 1, Mexico is a party to the 1958 New York Convention, which was duly ratified on 4 April 1971 and published in the Mexican Federal Official Gazette on 22 June 1971. Mexico made no declarations or reservations upon the execution of the Convention.