Cap. 503 Art. 41Recognition of foreign mortgages and foreign security interests.

(1)A foreign mortgage shall be recognised as a mortgage with the status and all the rights and powers specified in this Act, notwithstanding the fact that it is not entered on a registered aircraft if:

(a) such mortgage has been validly recorded in the registry of aircraft or other register of the country under whose laws the aircraft is documented;

(b) such registry is a public registry;

(c) such mortgage appears upon a search of such registry; and

(d) such mortgage is granted a preferential and generally equivalent status as a mortgage under this Act under the laws of the country where the mortgage is registered.

(2) An international interest registered in the International Registry in accordance with the First Schedule shall be recognized and enforceable under the laws of Malta and shall have the status and all rights and powers specified in the First Schedule with reference to a registered aircraft irrespective of whether it is recorded in the Malta Aircraft Register or not.

(3) Without prejudice to any default remedies as may be applicable by virtue of the First Schedule, the holder of a security interest which is registered in accordance with the First Schedule shall, in the event of default of any term or condition of such security or of any document or agreement referred to therein, and upon giving notice in writing to the debtor -

(a) have power to terminate the agreement and take possession or control of the aircraft to which the agreement relates; or

(b) apply to the court to authorise or direct either of these acts.

(4) A security interest and, or an international interest which is registered in accordance with the First Schedule shall be an executive title for the purposes of article 253 of the Code of Organization and Civil Procedure.

(5) The powers referred to in sub-article (3)(a) may be exercised by the creditor without the leave of any court and to the extent that any creditor seeks the support of the court due to any hindrance of any conditional buyer or lessee to the exercise of his rights, the court shall render full support to the holder of the security interest as expeditiously as possible including by making any declaration on the vesting of ownership or lessor rights or the termination of possessory rights to the aircraft.

(6) The provisions of -

(a) the last paragraph of article 33(1); and

(b) article 33(2), (7) and (8), with reference to the powers stated in sub-article (3) of this article and generally stated in the First Schedule shall apply to the enforcement of a security interest which is registered in accordance with the First Schedule.

(7) Where the holder of a security interest or of an international interest registered in accordance with the First Schedule seeks the support of the court in the course of the exercise of any remedies competent to him in terms of this Act he shall do so by virtue of an application filed in the competent court.

(8) A security interest shall be governed by the terms of the security agreement constituting such interest whether with reference to a registered aircraft or otherwise. The existence or validity of the security interest, its construction and its effects shall be governed by the proper law applicable to the security agreement and when executed and, or perfected in accordance with the proper law, shall be recognised and given effect to in Malta in accordance with this article. Such interests shall be subject and subordinate to the rights of any registered mortgagee or the holder of an international interest duly registered in accordance with the First Schedule and shall be subject also to the terms of any inter-creditor agreement.

(9) A security interest shall operate for such time and under such conditions as apply under the proper law governing the security agreement.