Comair has launched an urgent application to interdict the Air Services Licensing Council (ASLC) from suspending its domestic licence, according to a Sens released on Tuesday.
Background
In 2013/14, competitor FlySafair lodged a complaint with the ASLC against listed airline company Comair.
In its 2015 annual report Comair stated that FlySafair’s complaint was based on the allegation that Comair “breached the Air Services Licensing Act by failing to apply for a license amendment after undertaking a share repurchase programme and secondly that when a “look through” construction is applied to the Group’s current foreign shareholding component, the amount of this shareholding slightly exceeds the restrictions specified in the said Act.”
It said Comair and FlySafair appeared before the ASLC in September 2014 and Comair made further submissions about its shareholding on request of the regulator.
It said: “Following July 2015 Comair provided further shareholding information to the Council and thereafter FlySafair stated that it would no longer persist with its complaint.”
In April the ASLC told Moneyweb Comair had been given until 11 May to comply with the conditions of its air services licence; failure to do so could lead to the suspension or cancellation of the licence.
The Air Services Licensing Act states that nobody is permitted to operate a commercial air service without a valid Air Service Licence.
In an official response to Moneyweb’s question, the ASLC said in April that it made a ruling in March this year to reject Comair’s submissions and sent a letter of non-compliance to Comair “which will be affected on 11 May 2016.”
Comair has asked the ASLC to agree that it has not started suspension proceedings in accordance with the Act, and requested the ASLC to agree not to take any further action against the company, pending the outcome of a review of the ASLC’s decisions.
“The ASLC has failed to agree to the Company’s request. The Company has taken the precaution of launching an urgent application to interdict the ASLC from suspending the Company’s domestic license, pending the outcome of a review by a court of law.”
Comair emphasised that its “disagreement” with the ASLC is not related to the safety of its operations, but “exclusively to a shareholder regulatory issue.”
Comair shares were flat at R3.30 at 11:35 on Tuesday.
