Airlink seeks court decision on objection against international air service licence councilDate: 12 Nov 2019
Johannesburg, South Africa – Airlink is going ahead with its application to the Pretoria High Court to review the South Africa’s International Air Services Council’s (IASC) award of licences to SA Express on the grounds they were granted without all of the stipulated compliance requirements being met.
In the meantime, at the request of the Competition Commission in the context of an ongoing market investigation, Airlink has agreed to withdraw its request for an urgent interdict suspending the IASC’s decision to allow SA Express to operate three new cross-border routes.
Airlink’s legal challenge is not aimed at limiting competition (it only operates on one of the new routes for which SA Express has been licenced and already faces competition on that route). Its objective is to ensure the consistent application of the law by the IASC when it considers the fitness and ability of any airline to sustain safe and reliable commercial international air services.
To guide the IASC in its considerations, the International Air Services Regulations very clearly stipulate the criteria to be met by, and the information to be furnished by all airlines in support of their applications. In addition to the type of aircraft, the airport to be served and frequency of flights, it requires the submission of evidence of “financial capability” which has ordinarily included; audited financial statements demonstrating “going concern”, current profit and loss statements, balance sheets and statements of retained earnings, as well as a clear business case.
In this instance, the IASC appears to have made its decision in the absence of any recent set of audited accounts for SA Express and disregarding the Public Enterprises minister’s (representing SA Express’s shareholder) advice to Parliament in September that the carrier was not a going concern and was “experiencing financial difficulties”.
Similarly, the IASC’s decision appears to ignore SA Express directors and executive management’s September briefing to Parliament on its liquidity crisis and resultant high level of aircraft unserviceability, which led to its inability to provide the regular, on-time domestic air services it advertised and for which it was taking customers’ money.
Airlink embraces fair competition and has rivals on almost all of the 55 routes it serves, with more than 60,000 flights annually.
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