IIB 

108TH CONGRESS 

2D SESSION H. R. 4226

IN THE SENATE OF THE UNITED STATES 

JUNE 23 (legislative day, JUNE 22), 2004

Received; read twice and referred to the Committee on Commerce, Science, 

and Transportation 

AN ACT

To amend title 49, United States Code, to make certain 

conforming changes to provisions governing the registration of aircraft and the recordation of instruments in 

order to implement the Convention on International Interests in Mobile Equipment and the Protocol to the 

Convention on International Interests in Mobile Equipment on Matters Specific to Aircraft Equipment, known 

as the ‘‘Cape Town Treaty’’.

1 Be it enacted by the Senate and House of Representa2 tives of the United States of America in Congress assembled,
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1 SECTION 1. SHORT TITLE. 

2 This Act may be cited as ‘‘Cape Town Treaty Imple3 mentation Act of 2004’’. 

4 SEC. 2. FINDINGS AND PURPOSE. 

5 (a) FINDINGS.—Congress finds the following: 

6 (1) The Cape Town Treaty (as defined in sec7 tion 44113 of title 49, United States Code) extends 

8 modern commercial laws for the sale, finance, and 

9 lease of aircraft and aircraft engines to the inter10 national arena in a manner consistent with United 

11 States law and practice. 

12 (2) The Cape Town Treaty provides for inter13 nationally established and recognized financing and 

14 leasing rights that will provide greater security and 

15 commercial predictability in connection with the fi16 nancing and leasing of highly mobile assets, such as 

17 aircraft and aircraft engines. 

18 (3) The legal and financing framework of the 

19 Cape Town Treaty will provide substantial economic 

20 benefits to the aviation and aerospace sectors, in21 cluding the promotion of exports, and will facilitate 

22 the acquisition of newer, safer aircraft around the 

23 world. 

24 (4) Only technical changes to United States law 

25 and regulations are required since the asset-based fi26 nancing and leasing concepts embodied in the Cape 
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1 Town Treaty are already reflected in the United 

2 States in the Uniform Commercial Code. 

3 (5) The new electronic registry system estab4 lished under the Cape Town Treaty will work in tan5 dem with current aircraft document recordation sys6 tems of the Federal Aviation Administration, which 

7 have served United States industry well. 

8 (6) The United States Government was a leader 

9 in the development of the Cape Town Treaty. 

10 (b) PURPOSE.—Accordingly, the purpose of this Act 

11 is to provide for the implementation of the Cape Town 

12 Treaty in the United States by making certain technical 

13 amendments to the provisions of chapter 441 of title 49, 

14 United States Code, directing the Federal Aviation Ad15 ministration to complete the necessary rulemaking proc16 esses as expeditiously as possible, and clarifying the appli17 cability of the Treaty during the rulemaking process. 

18 SEC. 3. RECORDATION OF SECURITY INSTRUMENTS. 

19 (a) ESTABLISHMENT OF SYSTEM.—Section 44107(a) 

20 of title 49, United States Code, is amended—

21 (1) in paragraph (2)(A) by striking ‘‘750’’ and 

22 inserting ‘‘550’’; and 

23 (2) in paragraph (3) by striking ‘‘clause (1) or 

24 (2) of this subsection’’ and inserting ‘‘paragraph (1) 

25 or (2)’’. 
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1 (b) INTERNATIONAL REGISTRY.—Section 44107 of 

2 such title is amended by adding at the end the following: 

3 ‘‘(e) INTERNATIONAL REGISTRY.—

4 ‘‘(1) DESIGNATION OF UNITED STATES ENTRY

5 POINT.—As permitted under the Cape Town Treaty, 

6 the Federal Aviation Administration Civil Aviation 

7 Registry is designated as the United States Entry 

8 Point to the International Registry relating to—

9 ‘‘(A) civil aircraft of the United States; 

10 ‘‘(B) an aircraft for which a United States 

11 identification number has been assigned but 

12 only with regard to a notice filed under para13 graph (2); and 

14 ‘‘(C) aircraft engines. 

15 ‘‘(2) SYSTEM FOR FILING NOTICE OF PROSPEC16 TIVE INTERESTS.—

17 ‘‘(A) ESTABLISHMENT.—The Adminis18 trator shall establish a system for filing notices 

19 of prospective assignments and prospective 

20 international interests in, and prospective sales 

21 of, aircraft or aircraft engines described in 

22 paragraph (1) under the Cape Town Treaty. 

23 ‘‘(B) MAINTENANCE OF VALIDITY.—A fil24 ing of a notice of prospective assignment, inter25 est, or sale under this paragraph and the reg-
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1 istration with the International Registry relat2 ing to such assignment, interest, or sale shall 

3 not be valid after the 60th day following the 

4 date of the filing unless documents eligible for 

5 recording under subsection (a) relating to such 

6 notice are filed for recordation on or before 

7 such 60th day. 

8 ‘‘(3) AUTHORIZATION FOR REGISTRATION OF

9 AIRCRAFT.—A registration with the International 

10 Registry relating to an aircraft described in para11 graph (1) (other than subparagraph (C)) is valid 

12 only if (A) the person seeking the registration first 

13 files documents eligible for recording under sub14 section (a) and relating to the registration with the 

15 United States Entry Point, and (B) the United 

16 States Entry Point authorizes the registration.’’. 

17 SEC. 4. REGULATIONS. 

18 (a) IN GENERAL.—The Administrator of the Federal 

19 Aviation Administration shall issue regulations necessary 

20 to carry out this Act, including any amendments made by 

21 this Act. 

22 (b) CONTENTS OF REGULATIONS.—Regulations to be 

23 issued under this Act shall specify, at a minimum, the re24 quirements for—
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1 (1) the registration of aircraft previously reg2 istered in a country in which the Cape Town Treaty 

3 is in effect; and 

4 (2) the cancellation of registration of a civil air5 craft of the United States based on a request made 

6 in accordance with the Cape Town Treaty. 

7 (c) EXPEDITED RULEMAKING PROCESS.—

8 (1) FINAL RULE.—The Administrator shall 

9 issue regulations under this section by publishing a 

10 final rule by December 31, 2004. 

11 (2) EFFECTIVE DATE.—The final rule shall not 

12 be effective before the date the Cape Town Treaty 

13 enters into force with respect to the United States. 

14 (3) ECONOMIC ANALYSIS.—The Administrator 

15 shall not be required to prepare an economic anal16 ysis of the cost and benefits of the final rule. 

17 (d) APPLICABILITY OF TREATY.—Notwithstanding 

18 parts 47.37(a)(3)(ii) and 47.47(a)(2) of title 14, of the 

19 Code of Federal Regulations, Articles IX(5) and XIII of 

20 the Cape Town Treaty shall apply to the matters described 

21 in subsection (b) until the earlier of the effective date of 

22 the final rule under this section or December 31, 2004. 
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1 SEC. 5. LIMITATION ON VALIDITY OF CONVEYANCES, 

2 LEASES, AND SECURITY INSTRUMENTS. 

3 Section 44108(c)(2) of title 49, United States Code, 

4 is amended by striking the period at the end and inserting 

5 ‘‘or the Cape Town Treaty, as applicable.’’. 

6 SEC. 6. DEFINITIONS. 

7 (a) IN GENERAL.—Chapter 441 of title 49, United 

8 States Code, is amended by adding at the end the fol9 lowing: 

10 ‘‘§ 44113. Definitions 

11 ‘‘In this chapter, the following definitions apply: 

12 ‘‘(1) CAPE TOWN TREATY.—The term ‘Cape 

13 Town Treaty’ means the Convention on Inter14 national Interests in Mobile Equipment, as modified 

15 by the Protocol to the Convention on International 

16 Interests in Mobile Equipment on Matters Specific 

17 to Aircraft Equipment, signed at Rome on May 9, 

18 2003. 

19 ‘‘(2) UNITED STATES ENTRY POINT.—The term 

20 ‘United States Entry Point’ means the Federal 

21 Aviation Administration Civil Aviation Registry. 

22 ‘‘(3) INTERNATIONAL REGISTRY.—The term 

23 ‘International Registry’ means the registry estab24 lished under the Cape Town Treaty.’’. 
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1 (b) CONFORMING AMENDMENT.—The analysis for 

2 such chapter is amended by adding at the end the fol3 lowing:

‘‘44113. Definitions.’’.

4 SEC. 7. EFFECTIVE DATE AND PRESERVATION OF PRIOR 

5 RIGHTS. 

6 This Act, including any amendments made by this 

7 Act, shall take effect on the date the Cape Town Treaty 

8 (as defined in section 44113 of title 49, United States 

9 Code) enters into force with respect to the United States 

10 and shall not apply to any registration or recordation that 

11 was made before such effective date under chapter 441 

12 of such title or any legal rights relating to such registra13 tion or recordation.

Passed the House of Representatives June 22, 2004. 

Attest: JEFF TRANDAHL, 

Clerk.