If a lease is to be an excepted lease, the principal terms of
the lease (see
BLM23015) must not be materially
different from those in the pre-existing heads of agreement.
No change in lessee is allowed by Condition 5 in
BLM23025.
A minor change in the specification of an asset would not
constitute a material difference. A change in type of asset, for
example from one type of aircraft to another, would constitute a
material difference unless the two types of aircraft were so
similar as not to be materially different.
A change in the rentals that reflects an increase in
construction costs from estimates made at the date of the
pre-existing heads of agreement is unlikely to make the final lease
materially different from the existing agreement.
In contrast, if the increase in costs reflects a change in
the nature of the assets to be leased then there might be a
material difference from the existing agreement. It would depend on
the details of the particular case, particularly the degree to
which the assets that are finally leased are different from those
described in the existing agreement.
It is, however, the final lease, taken as a whole, which must
not be materially different from the existing agreement for the
transitional rules to apply. All the facts should be taken into
account before coming to a final decision.
