Using VesselsValue data, Gary Crichlow, Aviation Lead, analyses the current environment surrounding Russian controlled aircraft as a result of Western imposed sanctions. His article looks into the restrictions on aircraft connected to Russia, the impact of these restrictions on Market Value assumptions, and trading in a restricted market.
"The restrictions imposed by the US, UK, EU, and Canada have swiftly blocked the transfer of aircraft and parts, curtailed provision of maintenance services, enforced cancellation of leases and insurance, and restricted the movement of hard currency in and out of Russia.
In response to these measures, the Russian authorities have legislated for the effective seizure of ‘unfriendly’ aircraft within their territory and begun the process of entering these aircraft onto their registry, in apparent violation of the Chicago Convention, which expressly prohibits simultaneous registration of aircraft in more than one state.
The nature of the restrictions, particularly the licence requirements issued by the United States that apply to any aircraft with more than 25% US originated content, effectively render sanctioned aircraft off limits to anyone anywhere seeking a trade. It is important to note that the restrictions also apply to trades within Russia: enforcing them is obviously impractical within Russian territory, but may still give potential traders, with an eye towards future relationships with the West, reason to pause..."
Read the full article here: https://blog.vesselsvalue.com/valuing-russian-controlled-aircraft/