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Saturday, November 18, 2017

PAL settles P6-billion outstanding balance of CAAP payables

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By Emmie V. Abadilla

Philippine Airlines (PAL) on Friday settled its P6-billion unpaid air navigational charges to the national government, which were incurred since 1970s up to end of July this year.

The flag carrier made the payment ahead of its December, 2017 deadline.

PAL Vice President for Legal Affairs Atty. Clara De Castro, brought the company checks to the office of the Civil Aviation Authority of the Philippines (CAAP) in Pasay to settle its financial obligations to the state.

She turned over a check amounting to P5,677,887,615 to CAAP Chief Accountant Raul Eusebio. She turned over another check worth P258,594,230.33, net of taxes, to Manila International Airport Authority (MIAA) Assistant General Manager for Finance and Administration Arlene Britanico.

Department of Transportation (DOTr) Undersecretary for Aviation and Airports Manuel Antonio L. Tamayo, Undersecretary for Legal Affairs and Procurement Reinier Paul Yebra and Assistant Secretary for Communications Leah Quiambao witnessed the turnover of checks

Early last month, PAL agreed to fork out P6 billion in unpaid navigational fees to the government, from the P7.3-billion original amount, within the year.

The DOTr has been demanding that the flag carrier make a full payment on the P7.3-billion total charges as early as August, 2016.

The state agency accepted PAL’s offer to pay the R6-billion claims of the CAAP/MIAA in full. The flag carrier also committed to keep all transactions updated and current with the CAAP/MIAA.

After discussions to reconcile invoices and documents, PAL paid P370 million to CAAP and wanted to pay the balance in installments over the next 7 years.

DOTr denied the request and sent PAL a final demand for full payment of all unpaid charges, “preparatory to the filing of appropriate legal action in order to protect the interest of government.”

PAL maintained that the alleged unpaid navigational charges “involves complex legal issues” which the airline has been trying to resolve with the CAAP “for years.”

“The same legal issues were the subject of a court case between PAL and the MIAA years back where the court ruled in favor of PAL.” But “despite the favorable ruling, PAL then opted to settle amicably with the MIAA,” and with CAAP.

CAAP formed an inter-agency panel of negotiators to settle the matter.

For its part, PAL formally submitted an offer to pay CAAP for an amount which was more than the total covered by CAAP’s supporting invoices which the airline received.

Finally, DOTr and PAL managed to break the deadlock last month.

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  • gilberto amorsolo

    this is a good accomplishment for the duterte administration…