Diarmuid Wilson (Fianna Fail)

I welcome the Minister to the House. He has had a long day here. When I saw this Bill on the Order of Business, I wondered whether this topic should be the responsibility of the Department of Communications, Marine and Natural Resources. However, after reading the Bill I am satisfied that it is being dealt with by the correct Department.

The Bill will allow Ireland to ratify the Convention on International Interests in Mobile Equipment and Protocol on Matters Specific to Aircraft Equipment which was opened for signature at Cape Town on 16 November 2001. Enactment will give the convention and protocol the force of law in Ireland. The purpose of the convention and its associated protocol is to create an international legal framework to facilitate asset based financing of aircraft, aircraft engines and helicopters. Asset based financing means leasing and loans where the principal asset securing the debt is the aircraft involved. As aircraft regularly move between countries and international legal frameworks, it is necessary to assure lenders that they may recover control of the aircraft if the borrower defaults on the lease or loan repayments while the aircraft is in another country. By reducing the risk to lenders, the convention will benefit airlines through costs and finance. It will also benefit consumers in the form of lower fares. I agree with the hope expressed by Senator Dooley that reductions in fares do not come at the expense of service or standards at airports.

The incorporation of the convention into Irish law will only impact on large scale financing contracts between debtors and creditors who choose to take advantage of the protection of the convention. Persons and firms involved in such large scale finance will be professionally advised on all aspects of their financing contracts. To gain the protection of the convention, financial interests in aircraft must be recorded in the international registry which is defined in the convention. The international registry will be entirely computerised, operating over the Internet 24 hours per day and seven days per week. It will be self-financing through user fees and will be regulated by the International Civil Aviation Organisation.

The Department of Transport participated in the preliminary work for the design of the international registry system, which included hosting a working group in Dublin. The registry is separate from the role of the Irish Aviation Authority in recording aircraft on the register under the 1944 Chicago Convention for the purpose of safety supervision. The international registry is solely concerned with recording financial interests in aircraft and has no role in aircraft safety. The ICAO held a competition in 2004 to select a company to operate the international registry for its first five years. The proposal submitted by an Irish company was unanimously selected, as has been noted by a number of speakers. I welcome that this company, which succeeded against companies from Canada, Singapore and Spain will be based in Shannon.

I support Senator Dooley's interest in the future of Shannon Airport. I also welcome the support for the airport from Fine Gael in this matter. Members of that party have often been unsupportive in the past. It has sponsored motions which could have jeopardised jobs in the region.

The convention and protocol will enter force after ratification by eight countries. In view of Ireland's support for the project and the location of the international registry company in Ireland, it is hoped that Ireland will one of these countries. To date, six countries have ratified the convention. I support this Bill and wish it a speedy passage through the house. The legislation will not incur a charge on the Exchequer beyond a sum of €40,000 for the purchase of shares in the company.