AIRLINK is considering
seeking an injunction
to prevent SA Express
(SAX) from implementing an
amendment to its licence
that will see the airline
increase its flights on three
new routes.
SAX has received approval
by the International Air
Services Council (IASC)
to add seven new return
flights between Cape Town
International Airport and
Gaborone in Botswana,
seven return flights between
OR Tambo International
Airport and Bulawayo in
Zimbabwe, and three return
flights to Luanda in Angola.
The airline called out
Airlink as the reason
for the delay, saying the
competitor’s objections
were in an “effort to remain
the sole operator in these
markets”.
Airlink has responded
saying that of the three
routes for which SAX has
been approved, Airlink
doesn’t offer services on
two and the remaining route
has two other competitors
in addition to Airlink. “SAX
is throwing up red herrings
as a purposeful decoy in
order to detract from the
real issue. Our objection is
not intended to preclude
competition, but rather to
demand fair competition,”
says Rodger Foster, md of
Airlink.
Airlink lodged an objection
for the new routes, believing
it was made as a result of
an error of judgment due
to SAX not submitting its
audited financial statements
and therefore not being able
to prove its financial fitness
– a prerequisite of the
International Air Services
Act, says Rodger.
“South Africa’s
International Air Services
Regulations stipulate that
all applicants must submit
their financial data in
support of their applications
for new or amended air
services licences, and are
also required to submit
their audited annual
financial statements and
demonstrate that at the
time of the application they
are not insolvent, that they
have the financial means to
undertake the additional air
services and that they are a
going concern,” Airlink said
in a statement.
Last month, SAX advised
Parliament’s Select
Committee on Public
Enterprises that it was
currently able to operate
just four of the 11 aircraft
on its licence and that
its fleet expansion plan
had been delayed due to
‘liquidity challenges’, the
statement adds.
Airlink calls the Council’s
decision to approve SAX’s
application to operate the
additional routes prejudicial
to the general public and
the air service industry.
Airlink has asked the council
to review its decision
since Airlink’s objection
was not upheld and SAX’s
application to amend its
licence was granted.
“Our requirement of the
licensing council is that all
applicants be treated fairly
and equally. SAX should
have at least presented its
audited annual financial
statements so the council
could adjudicate its financial
fitness based on fact.
During the hearing process,
the council insisted that
SAX would have to do this,
and clearly this hasn’t
happened,” Rodger says.
“If privately owned airlines
are required to adhere to
the law and submit audited
financial statements and
thereby demonstrate their
financial fitness, we believe
that the same rules must
apply to SOEs like SAX,”
Rodger says.
Airlink adds that
competing with statesubsidised perpetual lossmaking competitors that
lack a profit imperative,
receive taxpayer bailout and,
which, by its own admission,
is unable to keep all of its
aircraft airworthy, is grossly
unfair.
Attempts by TNW to make
contact with the Department
of Transport – who appoints
the IASC – for comment,
were unsuccessful.
