Our Commercial Director in Paris explains the important role France plays in the fast-growing aircraft leasing market of Indonesia.
Air travel is a key form of transportation for Indonesia and no wonder - the country's population is over 250 million and it's made up of more than 17,000 islands. South East Asia's biggest economy is a fast-growing market for airlines as both internal and international routes expand. Lion Air ordered 200 Airbus in 2013 and Garuda placed a request for 60 Boeing and 30 Airbus aircraft at the Airbus show in Bourget, France, earlier this year.
There is of course also the usual aircraft replacement and diversification need by companies, which leads to Indonesian airlines establishing new affiliates and subsidiaries.
Not all airlines buy new aircraft, with many instead turning to aircraft leasing companies. TMF Group in France works closely with tax and legal firms to assure local compliance particularly around aircraft leasing transactions and transfer pricing documents.
It is quite typical for the owner of the aircraft to be an Irish entity, with the aircraft then on-leased via France to Indonesia. Setting up leasing arrangements via France may allow for certain tax, accounting and/or regulatory relief and TMF Group France provides Accounting/Tax Compliance, Management, Domiciliation and Corporate Secretarial services to these types of entities.
Support partners such as ourselves are really important to ensure leasing companies operating in France are registered for corporation tax swiftly after incorporation, for example. Our experts also assist with VAT registration and tax residency certificates.
TMF Group can also help by coordinating the opening of the bank account once the aircraft leasing company has arranged for the necessary introduction. Opening a bank account in France can be a time consuming matter especially due to compliance requirements, and working with us can help ensure this is done smoothly. Additionally our experts see that monthly accounting reporting takes place on time, necessary annual reports are prepared, approved by shareholders and filed by the legal deadlines with the French commercial registers.
Some aircraft leasing companies have a small number of employees to begin with, with tailored remuneration and benefits packages. Our experts in France frequently help in this area as well. We work closely with our colleagues in Ireland and alongside lessors, banks, lawyers, auditors and other parties involved to keep the entire aircraft leasing structure compliant.
The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.