A World of Options

One of the most fascinating and sometimes exasperating things about the leasing market is its venue specificity. Inherent in the fact that lease structures are developed around particular legal regimes and tax codes is the fact that the variety of lease available differs with each country. Tax advantages played a key role in the initial success of the Norwegian KS system, yet the market that developed as a result survived the demise of the tax advantages nearly two decades ago and is still going strong. Players in the KG system hope the same will be true in Germany as tax incentives are diminished. Even as these traditionally important sources of lease finance for shipping adapt in a changing world, in Asia states such as Korea and Singapore are developing new incentives to lure lessees and encourage investors. Meanwhile evolutions are taking place in the options available in countries like England and Ireland that are worthy of note for the international shipowner.

In this section, then, we first take a look at the leasing model recently developed in Korea, which was first tested internationally by Top Tankers this past spring. We compare this briefly with typical KS and KG structures before revisiting the Pacific Shipping Trust IPO, which utilizes the model of a public equity-funded lessor as well as incentives recently put into place in Singapore to encourage the development of the maritime finance industry in the area. Finally, we take a look at what Ireland has to offer the shipping industry as well as how EU-harmonizing legislation will affect the British leasing market.

This is only an excerpt of A World of Options

Content is restricted to subscribers. To continue reading please Log-In or view our subscription options.