Govt to issue new licence for international flight operation

KATHMANDU, JUNE 4, 2012

The government, with an aim to promote new private companies and the existing ones, has announced the application to issue licence for the establishment of airlines or extension of domestic airlines for international air service operation by private airlines.

“We are trying to promote the existing domestic airline companies and at the same time also trying to introduce new private companies to start airline services,” said joint secretary at the Ministry of Culture, Tourism and Civil Aviation Suresh Acharya.

The ministry is planning to issue two licences –– one for cargo service and the other for passenger service. The ministry on May 25, 2012 had announced for proposals requesting for International Airlines Operating Licence by interested companies.

International companies currently have 94 per cent market share of the Nepali airline sector. “There are a number of private companies interested and through this announcement we are planning to provide them the opportunity,” he said.

According to a decision of the Council of Ministers on December 8, 2009, registered private companies can apply for a licence for operating international flights. At the same time, existing private airlines in Nepal can also apply for international flight operation licence.

There are 28 international airline operators, 10 fix-wing operators and five rotary-wing operators. According to the Civil Aviation Authority of Nepal (CAAN), Kingfisher Airlines has postponed its flights among the 28 different international operators.

Meanwhile, three different international operators –– Malaysian Air, Air Asia and BB Airways –– will soon start flights from Tribhuwan International Airport. Malaysian Air will start its flights from June, Air Asia from June 3 and BB Airways is preparing for its flight from September. BB Airways is promoted by TBI Group — an investment company led by Non-Resident Nepalese Association treasurer Bhawan Bhatta.

According to the ministry, the private companies willing to apply for the international flight operation licence must follow the country’s civil aviation regulations. The airline first needs to get permission from the ministry before approaching CAAN for its evaluation.

A new airline needs a bank guarantee of Rs 500 million and should have at least three aircraft, either on lease or on purchase basis, before it starts operations. The potential international airlines should put up a security bond of Rs 5 million and have a paid up capital of Rs 500 million. The company should also pay Rs 50,000 for the terms of reference document.

An airline that fulfills these terms of reference must obtain the air operator certificate within a year and start flights within the next year.

 

Source: THT

MoTCA for permitting more international airlines

KATHMANDU, May 21, 2012

Companies waiting to get license for international flight operations will have to wait a bit longer as the Ministry of Tourism and Civil Aviation (MoTCA) has decided to issue a public notice, inviting applications from firms interested to operate international airlines.

A ministry official said the proposal to permit more international airlines has been approved and that the ministry was issuing the notice shortly.

This is the third time in the past five years that the government is issuing such notice. When the notice was called in December 2009, the government had awarded licenses to Unity Airlines and Dynamics Airlines. However, both the licenses were scrapped after the firms were found involved in fraudulent activities. The government had awarded license to BB Airways, which is promoted by TBI Group, in January this year. The airline is preparing to start operation in four months.

According to the official, a company having paid-up capital of Rs 500 million and security bond of Rs 5 million can apply for the license. “The interested company can get document of Terms of Reference (ToR) by paying Rs 50,000 to the ministry. The license will be awarded within 3-4 months of the evaluation of their proposals,” the official added.

Besides, the company will need to pay Rs 50,000 per route as royalty.

After reviewing the application, the ministry will issue license under three categories- Class A, B and C. The operator with Class A license can operate flights on long haul routes (flights lasting more than three hours). Similarly, airlines with Class B can operate flights lasting three hours and Class C can operate flights lasting less than three hours.

Domestic operators with a minimum of five years of operation, however, can apply for international license anytime.

International firms interested to start Nepal-based international airlines will have to form a joint venture entity in Nepal. The government allows up to 85 percent foreign in international airlines.

Source: Republica

Five countries keen to increase flights to Ktm

 As Nepal witnesses substantial rise in number of air passengers, five countries have expressed interest to increase flight frequency to Kathmandu. United Arab Emirates (UAE), Bhutan, Pakistan, Saudi Arabia and Jordan have approached the government to increase flight frequency and seat frequency.

Along with number of flights, these countries have approached Nepal to review other particulars like route schedule while reviewing the Air Service Agreement (ASA), according to Suresh Acharya, joint-secretary at Ministry of Tourism and Civil Aviation (MoTCA).

Currently, four airlines from UAE -- Air Arabia, RAK Airways, Fly Dubai and Etihad, are operating 38 flights a week to Kathmandu. The existing ASA allows UAE-based carriers to operate 28 flights a week on the route.

The government has allowed them to operate 10 additional flights a week on temporary operation permit (TOP) basis. Air Arabia and Fly Dubai have permission to operate 14 flights a week each, while Etihad can operate up to seven flights. RAK Airways, which has permission to operate three flights a week, is currently operating two flights on weekly basis.

UAE has requested the government to increase number of flights to Kathmandu to 60 flights a week.

Similarly, Pakistan, which has single-designated ASA with Nepal, has approached the government to add more seats to and from Kathmandu. Bhutan and Jordan are also planning to add flight frequencies to and from Kathmandu. Earlier this year, USA and Australia had sent a proposal to the government, expressing interest to establish air connectivity with Kathmandu. However, there has been no further development on the proposals.

Nepal has signed ASA with 36 countries so far.

Although requests for increasing flight frequency to Kathmandu is encouraging, officials said recent instructions of International Relations and Human Rights Committee of parliament, which has asked the government to not be generous on fifth freedom rights, could pose difficulties for them while reviewing ASA.

The committee had issued such an instruction mainly after the MoTCA decided to grant fifth freedom rights to Air Arabia on Kathmandu-Kuala Lumpur sector. A writ petition too was filed against the decision at the Supreme Court. The case is currently sub judice in the apex court.

Though the apex court has yet to issue verdict on the case, instruction of the parliamentary committee had compelled the ministry to revoke its decision of awarding fifth freedom rights to Air Arabia in December, 2010.

“As the committee´s decision goes against existing ASA with UAE, it is likely to create problem while reviewing it,” the official said, adding: “Other countries are also seeking fifth freedom rights.”

Source: Republica