Abstract. In this paper we investigate properties of solutions of first and second order elliptic equations that degenerate along a simple closed curve in R 2 . These equations are generated by a C-valued vector field L. To the vector field L, we associate the second order operator P = Re LL + pL , where p is a C-valued function. We establish a one-to-one correspondence between the solutions of the equation Pu = 0 and those of an associated first order equation of type Lw = Aw + Bw.