Shanghai's Juneyao Air, in collaboration with a Japanese lessor and facilitated by Shanghai Huarui Financing Lease Co, recently completed the restructuring of three aircraft under a JOLCO (Japanese operating lease with call option) structure in the Lin-gang Special Area, marking the nation's first JOLCO sublease restructuring.

JOLCO, a popular international financing model for aircraft and ships, combines equity investments from Japanese investors with loans from international commercial banks based in Japan. This model offers advantages such as low costs, high financing ratios, and long terms.

Huarui established a special purpose vehicle (SPV) in Lin-gang to acquire aircraft assets from the Japanese lessor and lease them to Juneyao Air. This arrangement leverages the tax benefits of the Japanese structure and Lin-gang's policy advantages in institutional innovation and industry support. The area's policies on cross-border financial services and foreign exchange management reforms provide robust support for complex, multi-entity, multi-currency, and long-term aircraft leasing projects.

This restructuring exemplifies the deep integration of financial openness and innovation, foreign exchange management reform, and the evolving needs of the aviation industry in Lin-gang.

It provides a replicable and promotable model of innovation for domestic airlines and leasing companies, significantly contributing to the enhancement and diversification of China's aviation financing and promoting the high-quality development of air transport enterprises.

Lin-gang is becoming a key hub for cross-border offshore leasing of aircraft and ships in China.