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Union Calendar No. 304 

108TH CONGRESS 

2D SESSION H. R. 4226 

[Report No. 108–526] 

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’’. 

IN THE HOUSE OF REPRESENTATIVES 

APRIL 28, 2004 

Mr. YOUNG of Alaska (for himself, Mr. OBERSTAR, Mr. MICA, and Mr. 

DEFAZIO) introduced the following bill; which was referred to the Committee on Transportation and Infrastructure 

JUNE 8, 2004 

Reported with an amendment, committed to the Committee of the Whole 

House on the State of the Union, and ordered to be printed 

[Strike out all after the enacting clause and insert the part printed in italic] 

[For text of introduced bill, see copy of bill as introduced on April 28, 2004] 

A BILL 

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 
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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, 

3 SECTION 1. SHORT TITLE. 

4 This Act may be cited as ‘‘Cape Town Treaty Imple5 mentation Act of 2004’’. 

6 SEC. 2. FINDINGS AND PURPOSE. 

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

8 (1) The Cape Town Treaty (as defined in section 

9 44113 of title 49, United States Code) extends modern 

10 commercial laws for the sale, finance, and lease of 

11 aircraft and aircraft engines to the international 

12 arena in a manner consistent with United States law 

13 and practice. 

14 (2) The Cape Town Treaty provides for inter15 nationally established and recognized financing and 

16 leasing rights that will provide greater security and 

17 commercial predictability in connection with the fi18 nancing and leasing of highly mobile assets, such as 

19 aircraft and aircraft engines. 

20 (3) The legal and financing framework of the 

21 Cape Town Treaty will provide substantial economic 

22 benefits to the aviation and aerospace sectors, includ-
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1 ing the promotion of exports, and will facilitate the 

2 acquisition of newer, safer aircraft around the world. 

3 (4) Only technical changes to United States law 

4 and regulations are required since the asset-based fi5 nancing and leasing concepts embodied in the Cape 

6 Town Treaty are already reflected in the United 

7 States in the Uniform Commercial Code. 

8 (5) The new electronic registry system established 

9 under the Cape Town Treaty will work in tandem 

10 with current aircraft document recordation systems of 

11 the Federal Aviation Administration, which have 

12 served United States industry well. 

13 (6) The United States Government was a leader 

14 in the development of the Cape Town Treaty. 

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

16 to provide for the implementation of the Cape Town Treaty 

17 in the United States by making certain technical amend18 ments to the provisions of chapter 441 of title 49, United 

19 States Code, directing the Federal Aviation Administration 

20 to complete the necessary rulemaking processes as expedi21 tiously as possible, and clarifying the applicability of the 

22 Treaty during the rulemaking process. 

23 SEC. 3. RECORDATION OF SECURITY INSTRUMENTS. 

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

25 of title 49, United States Code, is amended— 
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1 (1) in paragraph (2)(A) by striking ‘‘750’’ and 

2 inserting ‘‘550’’; and 

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

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

5 or (2)’’. 

6 (b) INTERNATIONAL REGISTRY.—Section 44107 of 

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

8 ‘‘(e) INTERNATIONAL REGISTRY.— 

9 ‘‘(1) DESIGNATION OF UNITED STATES ENTRY

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

11 the Federal Aviation Administration Civil Aviation 

12 Registry is designated as the United States Entry 

13 Point to the International Registry relating to— 

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

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

16 identification number has been assigned but only 

17 with regard to a notice filed under paragraph 

18 (2); and 

19 ‘‘(C) aircraft engines. 

20 ‘‘(2) SYSTEM FOR FILING NOTICE OF PROSPEC21 TIVE INTERESTS.— 

22 ‘‘(A) ESTABLISHMENT.—The Administrator 

23 shall establish a system for filing notices of pro24 spective assignments and prospective inter25 national interests in, and prospective sales of, 
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1 aircraft or aircraft engines described in para2 graph (1) under the Cape Town Treaty. 

3 ‘‘(B) MAINTENANCE OF VALIDITY.—A filing 

4 of a notice of prospective assignment, interest, or 

5 sale under this paragraph and the registration 

6 with the International Registry relating to such 

7 assignment, interest, or sale shall not be valid 

8 after the 60th day following the date of the filing 

9 unless documents eligible for recording under 

10 subsection (a) relating to such notice are filed for 

11 recordation on or before such 60th day. 

12 ‘‘(3) AUTHORIZATION FOR REGISTRATION OF

13 AIRCRAFT.—A registration with the International 

14 Registry relating to an aircraft described in para15 graph (1) (other than subparagraph (C)) is valid only 

16 if (A) the person seeking the registration first files 

17 documents eligible for recording under subsection (a) 

18 and relating to the registration with the United 

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

20 Point authorizes the registration.’’. 

21 SEC. 4. REGULATIONS. 

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

23 Aviation Administration shall issue regulations necessary 

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

25 this Act. 
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1 (b) CONTENTS OF REGULATIONS.—Regulations to be 

2 issued under this Act shall specify, at a minimum, the re3 quirements for— 

4 (1) the registration of aircraft previously reg5 istered in a country in which the Cape Town Treaty 

6 is in effect; and 

7 (2) the cancellation of registration of a civil air8 craft of the United States based on a request made in 

9 accordance with the Cape Town Treaty. 

10 (c) EXPEDITED RULEMAKING PROCESS.— 

11 (1) FINAL RULE.—The Administrator shall issue 

12 regulations under this section by publishing a final 

13 rule by December 31, 2004. 

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

15 be effective before the date the Cape Town Treaty en16 ters into force with respect to the United States. 

17 (3) ECONOMIC ANALYSIS.—The Administrator 

18 shall not be required to prepare an economic analysis 

19 of the cost and benefits of the final rule. 

20 (d) APPLICABILITY OF TREATY.—Notwithstanding 

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

22 of Federal Regulations, Articles IX(5) and XIII of the Cape 

23 Town Treaty shall apply to the matters described in sub24 section (b) until the earlier of the effective date of the final 

25 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, is 

4 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 following: 

9 ‘‘§ 44113. Definitions 

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

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

12 Town Treaty’ means the Convention on International 

13 Interests in Mobile Equipment, as modified by the 

14 Protocol to the Convention on International Interests 

15 in Mobile Equipment on Matters Specific to Aircraft 

16 Equipment, signed at Rome on May 9, 2003. 

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

18 ‘United States Entry Point’ means the Federal Avia19 tion Administration Civil Aviation Registry. 

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

21 ‘International Registry’ means the registry established 

22 under the Cape Town Treaty.’’. 

23 (b) CONFORMING AMENDMENT.—The analysis for such 

24 chapter is amended by adding at the end the following: 

‘‘44113. Definitions.’’. 
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1 SEC. 7. EFFECTIVE DATE AND PRESERVATION OF PRIOR 

2 RIGHTS. 

3 This Act, including any amendments made by this 

4 Act, shall take effect on the date the Cape Town Treaty (as 

5 defined in section 44113 of title 49, United States Code) 

6 enters into force with respect to the United States and shall 

7 not apply to any registration or recordation that was made 

8 before such effective date under chapter 441 of such title 

9 or any legal rights relating to such registration or recorda10 tion. 

Union Calendar No. 304 

108TH CONGRESS 

2D SESSION H. R. 4226 

[Report No. 108–526] 

A BILL 

To amend title 49, United States Code, to make 

known as the ‘‘Cape Town Treaty’’. ment on Matters Specific to Aircraft Equipment, tion on International Interests in Mobile Equipbile Equipment and the Protocol to the Conventhe Convention on International Interests in Moordation of instruments in order to implement erning the registration of aircraft and the reccertain conforming changes to provisions govJUNE 8, 2004 

Reported with an amendment, committed to the Comand ordered to be printed mittee of the Whole House on the State of the Union,