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Ireland is the global hub for aircraft leasing and financing, with over 60%¹ of the world’s leased aircraft being managed from there, and Dublin being home to more than 30 aircraft leasing companies².

In a potentially significant development that may impact the economics of aviation, the California Air Resources Board (“CARB”) is proposing a policy, as we previewed in January 2024, to update the state’s Low Carbon Fuel Standard (“LCFS”) program, whereby CARB would eliminate the existing exemption for intrastate fossil jet fuel from LCFS regulations beginning in 2028.

On May 31, 2024, the Department of the Treasury (“Treasury”) and the Internal Revenue Service continued to churn out Inflation Reduction Act of 2022 (“IRA”)¹ guidance by releasing Notice 2024-49 (the “Notice”) regarding the clean fuel production tax credit (the “45Z Credit”)² available under new section 45Z of the Internal Revenue Code of 1986, as amended.

As the aviation market moves towards a more sustainable future and fuel source, Brazil and other Latin American countries are likely to serve as key production locations for SAF due to their unique natural endowments and existing experience with bio-fuels.

On December 18, 2023, the European Union (EU) published its 12th package of sanctions targeting Russia via Regulation (EU) 2023/2878 and Regulation (EU) 2023/2875, which amend Regulation (EU) 833/2014 and Regulation (EU) 269/2014, respectively (collectively, the “12th Sanctions Package”).

Global air travel traffic (measured in revenue per kilometers (RPKs)) begins 2024 in line with pre-COVID highs.

CorpGov hosted a fireside chat from the floor of the New York Stock Exchange with Niels Jensen, Partner at Vinson & Elkins

As 2023 draws to a close we are taking a moment to recap on some of the headline events that have occurred in the aviation industry during the last 12 months.

Power-to-liquids technology can accelerate aviation’s decarbonization journey.

U.S. companies that found their assets caught up in Russia at the start of the Russia/Ukraine conflict may find relief on paper from U.S. courts. But it remains to be seen whether they can recover in practice.

On Friday May 19, 2023, Massachusetts Federal District Judge Leo T. Sorokin found that the partnership between JetBlue and American Airlines (“American”), known as the “Northeast Alliance” or “NEA,” harmed competition in the airline industry in violation of Section 1 of the Sherman Antitrust Act.

One of the reasons for a reduction in the number of aircraft asset-backed securitizations (ABS) coming to market in 2022 and 2023, is the time lag between the rapid increase in interest rates by central banks and the corresponding increases in lease rates which we are now seeing.