Helitours openly violating laws; no insurance for passengers

Ongoing discussions to “regularise” the operations of Helitours-- Sri Lanka Air Force’s (SLAF) commercial passenger service-- and to float a business plan for it do not take into account that the company is completely barred by the Civil Aviation Authority of Sri Lanka ( CAASL) from flying civilian passengers on any of its aircraft.

The CAASL does not accept a civilian air transport company called Helitours, an authoritative source said. Its planes have all been taken off the civilian aircraft register and it no longer has a valid air operator certificate (AOC).

But the e Finance Ministry's Public Enterprise Department (PED) and the SLAF are in talks now to transfer Helitours’ shares to the Treasury after the Auditor General queried how the company was registered as a private entity but sustained with taxpayer funds with public officials on its Board of Directors. Matters are close to being finalised, an SLAF spokesman said last week.

The PED and Helitours have also jointly decided to review the financial status of the company to identify a business plan for the company. PED officials visited Helitours in March for this purpose.

The civil aviation regulator, however, does not have access to Helitours aircraft or hangars to carry out independent safety audits and has no information on modifications or where, for instance, spare parts are procured from. Any civilian passenger flights ( scheduled or chartered) are operated without the knowledge and outside the purview of CAASL.

“The CAASL had doubts about the type of aircraft Helitours is using to transport civilian passengers and expressed these concerns to the company,” the source said. “They were notified that clearance cannot be given for their MA60 aircraft and their Harbin Y-12 was never on the civilian aircraft register.”

“They were also told that, if they acquire aircraft which are approved for passenger transport, we will give them the go-ahead,” he continued. “Right now, they have not met the required standards.”

However, Helitours still runs scheduled flights to and from Jaffna via Trincomalee and to and from Batticaloa with the caveat that these are “civil passengers transportation in military aircraft” [sic], as published on its website.

The company is violating several other international civil aviation rules and regulations by calling upon the passengers to sign indemnity forms prior to departure and stating that no insurance or baggage claims will be entertained “for any unforeseen circumstances”. This means passengers are told they fly at their own risk in clear violation of all prescribed laws.

This is just one reason why Helitours cannot hold an AOC. The Civil Aviation Act of 2010 categorically states that every holder of an AOC or a foreign AOC operating within Sri Lanka “shall keep in force at all times a liability insurance adequately covering his liability for death or bodily injury to passengers which may be caused by an accident and for the loss of or damage to baggage, cargo or mail, due to any event during the period of carriage and for the delay in the carriage of passengers, baggage, cargo or liability insurance."

The Act also defines “military aircraft” as “an aircraft used or operated for or on behalf of a State for purposes other than the carriage of passengers or cargo for hire or reward”.

Authoritative sources said that one- third of the budget allocated to the SLAF goes towards maintenance of Helitours’ MA60 planes. None of its planes is insured as they are military aircraft. It is unclear how they are allowed to transport civilians in the air when no land vehicles are permitted to travel on any road without insurance.

Helitours was resurrected by the previous regime to ferry civilians to and from various airports in the country. The Constitution decrees that auditing of all Government- owned companies rests with the Auditor General’s (AG) Department.

However, as the status of Helitours was unclear, the AG requested a letter from the SLAF confirming that it was a Government- owned entity since it was financed by the Treasury and its total revenue is credited to State coffers.

The Committee on Public Accounts ( COPA) also questioned the SLAF about the legality of public officials functioning on the Board of an entity registered under the Companies Act. It gave instructions to regularise Helitours as a State-owned enterprise. It is not clear how the operation continued for ten years without auditing by the AG.

In May, it was decided that full ownership of company shares will be transferred to the Secretary to the Treasury; the operational functions and management of Helitours will be with a Board of Directors comprising SLAF officers; and a represenative of the Treasury will also be on the Board. There is to be an agreement between SLAF and Helitours to get aircraft on lease.