Russian President Vladimir Putin has personally signed a decree temporarily converting contracts under “financial obligations in the transport sphere for certain foreign creditors” in “unfriendly” countries, so that Russian airlines will be able to transfer aircraft lease payments to them in rubles.
The document, posted on the government’s website for legal information on April 1, concerns all obligations “for the acquisition, rent, and lease of aircraft, auxiliary power units, and aircraft engines to foreign creditors that are entities associated with foreign states committing unfriendly actions in relation to the Russian Federation.”
The decree, which entered into force from the day of its publication, dictates that such payments can now be made by “the debtor transferring to an account of a resident company opened with a Russian credit institution” the funds in rubles equivalent to the sum in foreign currency calculated at the rate set by Russia’s central bank on the day of the transfer.
Moscow has said it will implement similar norms for gas exports to unfriendly countries.
The document also said it gives the Russian government “the authority to determine, other than that established by this decree, the procedure for fulfilling obligations to foreign creditors” for lease payments, and it gives Russia’s Government Commission on Monitoring Foreign Investment “the authority to issue permission to fulfil obligations.”
According to a list approved on March 7, the list of countries deemed unfriendly to Russia includes the United States, Canada, all European Union member states states, the United Kingdom (including Jersey, Anguilla, the British Virgin Islands, Gibraltar), Ukraine, Montenegro, Switzerland, Albania, Andorra, Iceland, Liechtenstein, Monaco, Norway, San Marino, North Macedonia, Japan, South Korea, Australia, Micronesia, New Zealand, Singapore, and Taiwan.
On March 31, the day before Putin signed the decree, Deputy Prime Minister Yuri Borisov said that all foreign leased aircraft still in Russia after the termination of leasing contracts had now been shifted to the local register and would remain in Russia. It is estimated that out of the approximately 500 aircraft that Western leasing firms axed the lease contracts with Russian airlines for, as a result of Russia’s actions in Ukraine, more than 400 remain in the country.
