Aircraft Loan Calculator

International Financing Guide

Calculator Guides Finance with Jaken Aviation

Financing an Aircraft for International Operations: Cross-Border Loans and Export/Import Considerations

Published: January 9, 2026 • Last Updated: January 9, 2026 • Reading Time: 17 min

Table of Contents

In an increasingly connected world, aircraft ownership frequently crosses international boundaries. Whether you're a U.S. entrepreneur purchasing a jet for global business travel, a European company acquiring aircraft registered in the United States, or an international buyer seeking favorable U.S. financing terms, understanding the complexities of cross-border aircraft financing is essential.

International aircraft transactions involve layers of complexity that domestic deals don't face: multiple legal jurisdictions, currency considerations, import/export regulations, tax treaties, and international conventions governing aircraft security interests. Navigating these waters requires specialized knowledge and careful planning.

This comprehensive guide will walk you through the essential elements of international aircraft financing. From structuring cross-border loans to ensuring export/import compliance, from vetting international lenders to understanding the Cape Town Convention's protections—we'll cover everything you need to know to successfully finance aircraft for international operations.

Structuring Your Deal: A Founder's Guide to Cross-Border Aircraft Loans

Cross-border aircraft financing presents unique structural challenges that require careful consideration from the outset. The way you structure your deal affects everything from tax efficiency to lender security to operational flexibility.

Understanding Cross-Border Financing Structures

Several common structures exist for international aircraft financing, each with distinct advantages:

1. Direct Foreign Lending

A lender in one country provides financing directly to a borrower in another country. This straightforward approach works well when:

However, direct foreign lending can be complicated by differing legal systems, enforcement challenges, and regulatory requirements in both jurisdictions.

2. Special Purpose Vehicle (SPV) Structures

Creating an SPV in a favorable jurisdiction to own the aircraft is common in international transactions. Benefits include:

Popular SPV jurisdictions include Ireland, the Cayman Islands, and Delaware (for U.S. registration purposes).

3. Owner Trust Structures

For non-U.S. citizens seeking U.S. registration (N-number), owner trusts are essential. The trust holds legal title while the foreign owner maintains beneficial ownership. This structure:

For detailed information on trust structures, see our guide on aircraft trusts and non-citizen registration.

4. Export Credit Agency (ECA) Financing

Government-backed export credit agencies provide financing or guarantees for aircraft purchases, particularly for larger commercial aircraft. ECAs include:

ECA financing typically offers favorable rates and terms but involves extensive documentation and compliance requirements.

Currency Considerations

Currency risk is a critical factor in cross-border financing. Key considerations include:

Most international aircraft transactions are denominated in U.S. dollars, as the global aircraft market primarily trades in USD. However, Euro-denominated financing is increasingly available for European operators.

Jurisdictional Considerations

The choice of governing law and jurisdiction significantly impacts your financing structure:

Working with aviation attorneys experienced in multiple jurisdictions is essential for properly structuring cross-border deals.

Structure Selection Factors

The optimal structure depends on: (1) borrower's nationality and tax residence, (2) intended aircraft registration, (3) operational requirements, (4) lender preferences, and (5) tax optimization goals. There's no one-size-fits-all solution—each transaction requires customized structuring.

Red Tape & Runways: The Ultimate Checklist for Aircraft Export/Import Compliance

Moving an aircraft across international borders involves navigating a complex web of regulations. Failure to comply can result in significant penalties, delays, and even seizure of the aircraft. Here's your comprehensive compliance checklist.

Export Compliance (Selling/Transferring from U.S.)

When exporting an aircraft from the United States, several regulatory frameworks apply:

1. Export Administration Regulations (EAR)

The Bureau of Industry and Security (BIS) administers export controls on dual-use items, including many aircraft and components:

2. International Traffic in Arms Regulations (ITAR)

Military aircraft and certain defense-related components fall under State Department jurisdiction:

3. FAA Deregistration

Before export, the aircraft must be properly deregistered from the FAA:

4. Customs Documentation

✓ U.S. Export Checklist

  • ☐ Determine export license requirements (EAR/ITAR)
  • ☐ Screen buyer against denied parties lists
  • ☐ Obtain necessary export licenses
  • ☐ File FAA deregistration
  • ☐ Obtain Export Certificate of Airworthiness
  • ☐ Release or transfer all liens
  • ☐ File Electronic Export Information
  • ☐ Coordinate with customs broker
  • ☐ Maintain complete export records

Import Compliance (Bringing Aircraft into U.S.)

Importing an aircraft into the United States involves its own set of requirements:

1. Customs Entry

2. FAA Registration

To register an aircraft with the FAA, you must:

3. Airworthiness Certification

4. State Sales/Use Tax

Many states impose sales or use tax on aircraft imports:

For state-specific guidance, see our aircraft state taxes guide.

International Customs Duties and VAT

When importing aircraft into other countries, expect to encounter:

European Union

Other Major Markets

⚠️ Compliance Warning

Export/import violations can result in severe penalties including fines up to $1 million per violation, criminal prosecution, and debarment from future transactions. Always work with experienced customs brokers and legal counsel for international aircraft transactions.

Finding Your Financial Co-Pilot: How to Vet International Lenders & Export Credit Agencies

Selecting the right financing partner for an international aircraft transaction requires careful due diligence. Not all lenders have the expertise, appetite, or infrastructure to handle cross-border deals effectively.

Types of International Aircraft Lenders

1. Global Banks with Aviation Divisions

Major international banks with dedicated aviation finance teams include:

These institutions offer sophisticated structuring capabilities, multiple currency options, and global reach. However, they typically focus on larger transactions ($10M+) and may have lengthy approval processes.

2. Specialized Aviation Finance Companies

Companies focused exclusively on aviation finance often provide more flexibility:

These lenders understand aviation-specific issues and may be more accommodating of complex structures.

3. Export Credit Agencies

For larger aircraft purchases, ECAs offer government-backed financing:

The U.S. Export-Import Bank provides detailed information on their aircraft financing programs.

Key Questions When Vetting International Lenders

Before committing to a lender, ask these essential questions:

  1. Experience: How many cross-border aircraft transactions have you completed in the past year?
  2. Jurisdictional expertise: Do you have experience with my specific countries/registration?
  3. Currency options: Can you lend in my preferred currency? What hedging options exist?
  4. Structure flexibility: Can you accommodate SPV, trust, or other structures?
  5. Timeline: What is your typical closing timeline for international deals?
  6. Documentation: What loan documentation do you require? Which jurisdiction's law governs?
  7. Security requirements: What security interests will you require? How will they be perfected?
  8. Cape Town registration: Do you require International Registry registration?
  9. Insurance requirements: What coverage levels and insurers do you accept?
  10. Operational restrictions: Are there geographic or use restrictions on the aircraft?

Red Flags to Watch For

Be cautious of lenders who:

Building Your Advisory Team

International aircraft transactions require a team of specialized advisors:

The cost of proper advisory support is minimal compared to the risks of getting an international transaction wrong.

The Global Handshake: How the Cape Town Convention Protects Your High-Value Asset

The Cape Town Convention on International Interests in Mobile Equipment, along with its Aircraft Protocol, represents one of the most significant developments in international aircraft financing. Understanding this framework is essential for anyone involved in cross-border aircraft transactions.

What is the Cape Town Convention?

The Cape Town Convention, which entered into force in 2006, creates an international legal framework for registering and enforcing security interests in aircraft, aircraft engines, and helicopters. Key features include:

The International Registry

The International Registry, operated by Aviareto in Dublin, Ireland, is the central database for registering international interests in aircraft. Key points:

Benefits for Lenders

The Cape Town Convention provides significant protections for aircraft lenders:

Studies by the Aviation Working Group suggest that Cape Town Convention compliance can reduce financing costs by 10-20 basis points for borrowers in qualifying jurisdictions.

Benefits for Borrowers

Borrowers also benefit from the Cape Town framework:

Contracting States

As of 2026, over 80 countries have ratified the Cape Town Convention and Aircraft Protocol, including:

The level of protection varies based on each country's specific declarations when ratifying the convention.

OECD Aircraft Sector Understanding

The OECD Aircraft Sector Understanding (ASU) provides additional benefits for transactions involving Cape Town-compliant countries. Qualifying transactions may receive:

Countries are classified into categories based on their Cape Town compliance level, with Category A countries receiving the most favorable treatment.

Practical Implications for Your Transaction

When financing an aircraft internationally, Cape Town considerations include:

  1. Registration requirement: Most lenders require International Registry registration
  2. Search before closing: Always search the registry before acquiring an aircraft
  3. Timing: Register your interest immediately upon closing
  4. Deregistration: Obtain Irrevocable Deregistration and Export Request Authorization (IDERA) where available
  5. Documentation: Ensure loan documents reference Cape Town Convention rights

Cape Town Best Practices

Always: (1) Search the International Registry before any aircraft transaction, (2) Register your security interest immediately upon closing, (3) Obtain IDERA authorization in qualifying jurisdictions, and (4) Ensure your loan documents properly reference Cape Town Convention remedies.

Calculate Your International Aircraft Loan

Use our calculator to estimate payments for your cross-border aircraft financing and compare different loan scenarios.

Try the Calculator

Final Thoughts on International Aircraft Financing

International aircraft financing adds layers of complexity to an already sophisticated transaction type. Success requires:

While the complexity may seem daunting, thousands of cross-border aircraft transactions close successfully each year. With proper preparation and the right team, you can navigate the international aircraft financing landscape confidently and secure favorable terms for your global aviation needs.

Related Resources