Gov’t calls on PAL to pay over R 7-B fees

The government is calling on Lucio Tan-owned Philippine Airlines (PAL) to pay in full over P7 billion in unpaid navigational charges and other fees incurred since the previous administrations.

Presidential Spokesman Ernesto Abella said the Department of Transportation (DOTr) intends to take legal action against the flag carrier if the debts are not immediately settled.

Abella argued the flag carrier no longer enjoys certain navigational privileges when it was previously owned by the government.

“The matter of Philippine Airlines’ unpaid charges has existed in past administrations. At issue is that then-government owned PAL enjoyed privileges namely, waiver of landing, take-off and other fees. However, such privileges no longer apply to the airline as the franchise has been sold to the private entity,” Abella said during a Palace press briefing.

In the news conference, Abella said PAL owes Civil Aviation Authority of the Philippines P6.965 billion as of July 30, 2017. The airline must also pay P322.1 million to the Manila International Airport Authority (MIAA), Abella added.

“As per Department of Transportation Secretary Arthur Tugade, the government demanded full payment of all unpaid charges as early as August 2016,” he added.

President Duterte earlier threatened to shut down the PAL terminal if Tan, one of the world’s billionaires, refuses to pay his debts to the government within 10 days.

Duterte lamented that the airline had been using government terminals and runways without proper payment of fees.

Reacting to the President’s statement, PAL reportedly said it was ready to submit a compromise agreement to settle the issue of alleged unpaid navigational charges.

“If you don’t pay, I will close it down. There will be no airport. So what?” Duterte said in Filipino during an assembly of the Philippine Constitution Association at the Manila Hotel last Tuesday night.

“I do not mind. If we sink, we sink. But I said, ‘We have to enforce the law.’ So guys, you guys, if you are put into a great discomfort, sorry. Wala akong magawa. The law is the law,” he said.

He said the transportation department has already sent its final demand for full payment of all unpaid charges to PAL. This was “in preparation for the filing of appropriate legal action in order to protect the interest of government,” according to Abella.