Copying and distributing are prohibited without permission of the publisher
JOLs make a comeback
01 December 2006
Since its launch in 1998, the Japanese operating lease (JOL) has survived a big government review and continues to gain popularity. Siqalane Taho reports on uncertain times for a widely used structure.
Read more:
Japanese Operating Lease; Nomura Babcock & Brown
International governments have developed a key competence for closing down cross-border tax structures. The US leveraged lease of the 1980s and the German leveraged lease of the 1990s are examples of how popular aircraft financing structures have slowly been shut.
When the Japanese government sent a delegation to Washington to study how authorities controlled tax-avoidance schemes, many feared the worst. Japanese tax authorities already had a good record of scrapping lucrative financing structures. It was only in 1998 that bankers were queuing up for the 4% to 6% net present value benefit offered by the Japanese leveraged lease (JLL). Just as the US, UK, German and Australian authorities had done before, the National Tax Agency introduced tax reforms making cross-border JLLs simply uneconomical.
The year 2006 will always be remembered as the time when the JOL nearly ended.
Many industry insiders had predicted that the National Tax Agency would finally...
Take a free website trial to view this article. It's easy to get a trial - just follow this link or email sbains@euromoneyplc.com.
Alternatively, if you're already a subscriber or have a trial, simply log in below to read the article.
Already have an account?
Subscribe
Subscribers have unlimited access to all current and archive content. Start your
subscription today - click on the button below.
Free trial
Taking a free trial will give you access to the current issue for two weeks (excluding
some surveys and articles). Start your free trial today.
