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France ends tax leases for Chinese carriers
10 February 2012
Changes to the Sino-French double-tax treaty could impact financing for deliveries this year.
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French lease
French tax lease
French optimised lease
Air China
China Southern
China Eastern
China's big three carriers will lose their most attractive financing tool following a change to the double-tax treaty between France and China.
Under the new treaty, French leases, which have also been called French tax leases or French optimized leases, will offer no benefit to Chinese airlines. French leases have reduced financing costs for airlines such as Air China, China Eastern and China Southern. One banker estimates a saving of up to 150 basis points compared to plain vanilla financing during the product's best years.
Tax authorities have informed French banks in the last weeks that a new Sino-French double-tax treaty has been...
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