No financial distress signs at MYAirline pre-suspension, Mavcom asserts

 

The Malaysian Aviation Commission (Mavcom) has asserted that there were no indications of financial distress at MYAirline Sdn Bhd before its suspension in October.

Mavcom executive chairperson Saripuddin Kasim was quoted by NST Business Times as saying that their data showed no signs of financial or operational distress that could have prompted the abrupt suspension on Oct 12.

“The airlines are required to submit their financial and operational reports to us every quarter.

“In fact, we impose monthly (financial and operational reports) submissions to certain companies. It depends on a case-by-case basis," Saripuddin said.

According to the English daily, Mavcom said MYAirline’s sudden suspension of operations has affected over 117,000 estimated passengers, resulting in a total value exceeding RM22 million in forward sales for scheduled flights from October 12, 2023, to March 31, 2024.

As an aviation regulator specialising in the economics and commercial division of the airline industry, Saripuddin emphasised that Mavcom thoroughly examines a company’s business and financial plan before approving an air service license (ASL).

He stressed that Mavcom ensures that only companies with the necessary competence and capabilities are permitted to operate.

“We have a set of requirements for airline companies to comply with for them to apply for their ASL,” he said.

These ASL requirements include a prerequisite for airlines to have a minimum of three to six months of working capital to demonstrate financial capability for business operations.

While Mavcom’s current framework for granting ASLs to airlines is comprehensive, Saripuddin said the aviation regulator has set up a task force to look into ways of possibly enhancing the application process for the ASL and other aviation-related licenses.

The establishment of the task force was initiated by Transport Minister Anthony Loke in October.

It will address the issue of refunds for MYAirline passengers affected by the suspension of operations. - Mkini