Case of too many regulators
HAVING served in the aviation industry for the last 54 years with 36 years in government and 18 more in aviation consultancy, I would like to reflect on our aviation scenario.
Currently, our institutional arrangements governing the industry comprises four bodies – the Transport Ministry, Civil Aviation Authority of Malaysia (CAAM), Malaysian Aviation Commission (Mavcom) and the Air Accident Investigation Board (AAIB).
Back in 1997, Tun Dr Mahathir Mohamad, who was prime minister then, called for the nation to participate in the aerospace industry in his address at an aerospace forum organised by the Malaysian Industry-Government Group for High Technology (MIGHT). Among others, he suggested transforming the Department of Civil Aviation into a Civil Aviation Authority to better regulate, facilitate and promote the nation’s aviation/aerospace industry.
Consultants were appointed to study the proposal, and recommendations were subsequently presented to the government. However, nothing was done for years for reasons best known to the administrators then at the Transport Ministry.
And then, amazingly, the previous government approved in 2015 the formation of a new regulatory body – Mavcom – to perform “economic” regulation of the aviation industry.
The Civil Aviation Authority was only approved in 2017 and established in 2018 after a 20-year wait.
Today, we have two principal aviation regulators – CAAM and Mavcom. Going through the principal Civil Aviation Act 1969 (amended), Malaysian Aviation Commission Act 2015, and the Civil Aviation Authority Act 2017, and subsidiary regulations, I found plenty of duplication and overlapping of functions between these two bodies.
Unfortunately, the Civil Aviation Authority Act 2017 did not define the CEO of CAAM as the director-general of civil aviation although there are provisions to state that he or she may be known by other designations.
The aviation industry needs to know who is the commander-in-chief of aviation in this country, hence the CEO of CAAM should be defined as the director-general of Civil Aviation Malaysia.
Furthermore, there are some functions of the Malaysian Competition Commission that are also in the Mavcom Act.
Mavcom has been given sweeping orders to pass regulations in areas which are not necessary and intrude in safety activities where it may not have the technical and operational aviation expertise and experience.
What is more alarming is the licensing functions for public air service carriers and permits for air charter aircraft and licensing of aerodromes serving public air carriers and charter flights were removed from the jurisdiction of the DCA (now CAAM) and placed under Mavcom.
Mavcom was also given sweeping powers to license a host of airport ground handling services and maintenance providers for airlines and airport operators under the Second Schedule of the Act. The provision for traffic rights and slot time allocations shows a complete lack of understanding of how the slot allocation works in the aviation system.
The licensing of public air service carriers and public use aerodromes is a serious undertaking as it involves public safety. Technical and operational assessment by experienced technical engineers and operational specialists in aviation regulatory bodies is necessary before a licence can be issued for air carriers and aerodromes. Elements such as the aerodrome infrastructure’s strength and dimension, navigation station, ground facilities, air worthiness of aircraft, equipment in aircraft, communication and operational procedures, technical and operational organisation, competent technical maintenance and operational personnel are just some examples of the long list of items to be assessed.
Due diligence in respect of licensing air carriers and aerodrome is best processed by the competent authority, namely CAAM, and the licence must be granted by the Transport Minister as the person ultimately responsible and accountable for public air transport safety.
Aviation is international in character. Competition among air carriers, aerodrome operators, economic activities and services and aerospace manufactures should be encouraged and promoted and not hindered with unnecessary economic regulations.
The new CAAM charges certification fees for air carriers, aerodrome operators and critical ground handling services. I do not see the rationale for Mavcom to also collect licensing fees for the same activities that CAAM can perform except to shore up its operating revenues.
Not all ground handling services should be licensed. Overlapping charges and duplication in regulatory functions will only increase the cost of doing business.
The aviation community gets a double wallop in fees. The travelling public has also been burdened with additional airport passenger fees with a portion going to Mavcom.
We do not need a standing body to process baggage claims as this is best left to airlines and the claims tribunal. Aviation fees review is best outsourced by the Transport Ministry when the need arises. The industry and citizens should not be burdened.
Financial capacity and flight approval can be performed by the air transport division of CAAM and the Transport Ministry which was the case in the past before Mavcom was formed. To claim that this function was not done in the past is not exactly true just to justify the establishment of Mavcom. Any other necessary functions of Mavcom can be done by CAAM.
The Transport Ministry must reclaim its role to promote the development of the aviation industry to foster a safe, reliable, affordable and accessible air transport for the economic and social wellbeing of Malaysians.