AirAsia to maximise revenue from under utilised space for cargo. Photo: Bernama

KUCHING: AirAsia Bhd (AAB) has paid about RM14.16 million to Malaysia Airports (Sepang) Sdn Bhd (MASSB) in relation to the latter’s claim for additional passenger
services charges.

The payment is based on the amount specified in the garnishee show cause orders dated Aug 23, 2019 to defray the garnishee execution proceedings, AirAsia Group Bhd said in a filing with Bursa Malaysia.

(A garnishee order is a common form of enforcing a judgement debt against a creditor to recover money.) 

AAB is 100 percent-owned by AirAsia Group while MASSB is a wholly-owned subsidiary of Malaysia Airport Holdings Bhd (MAHB).

To recap, MASSB served AAB with an unsealed copy of a writ of summon of RM9,395,656.50 pertaining to passenger service charges that AAB had not collected, and refused to collect from travelling passengers last December.

AAB had collected RM50 per non-Asean international passenger and had paid MASSB.

However, MASSB wanted AAB to collect another RM23 per passenger from July 2018, which AAB said it had not and would not collect.

While MASSB has insisted that KLIA2 should charge the same rates as KLIA, AAB has argued that as KLIA2 is a low-cost airport, the charges levied should, therefore, reflect the level of services provided.

AAB has maintained that it is not obliged to collect the same passenger service charges for passengers departing from KLIA2, and would not do so for the sake of all the stakeholders in the aviation and tourism industries.

In January, AAB filed a statement of defence and it contended, among others, that the claim by MASSB is “misconceived, invalid and/or premature” as MASSB has not complied with and/or availed itself of the statutory provisions for dispute resolution within the Malaysian Aviation Commission Act 2015 (Mavcom Act). Accordingly, AAB had filed an application to strike out MASSB’s suit.

Further, AirAsia Group’s filing with Bursa had then said that AAB, together with its affiliate AirAsia X Bhd (AAX) would be availing themselves of the statutory provisions for dispute resolution within the Mavcom Act to seek more than RM400 million in counter-claims against MASSB
and/or MAHB for losses and damages experienced by AAB and AAX due to operational disruptions at KLIA2.

On July 18, the High Court dismissed the application by AAB and AAX to strike out MASSB’s suit and allowed MASSB’s summary judgement application with costs of RM8,000 per application.

Following the court’s judgement, MASSB, through its solicitors, filed garnishee execution application to the High Court to execute the July 18 judgement for, among others, the outstanding additional passenger service charges.

On Sept 6, MASSB served garnishee show cause orders on three of AAB’s banks, directing them to set aside certain funds for the payment of the judgement sum.

On Sept 18, AAB paid RM14,156,818.47 to MASSB to defray the garnishee execution proceedings.

“The payment was made by AAB without prejudice to AAB’s rights, including AAB’s rights in the appeals made in relation to the judgement order on July 18, 2018 as well as any connected interlocutory applications,” said AirAsia Group.

AirAsia Group added: “Further updates in respect of any material development of the matter will be made from time to time in compliance with the requirements of the Main Market Listing Requirements of Bursa Malaysia Securities Bhd.”