Philippines Temporarily Closed to New Foreign Carriers

Congestion at the country's main gateway has forced the Civil Aeronautics Board to temporarily ban the issuance of new permits to foreign airlines planning to fly to Manila.

naia terminal 1
Copyright Photo: Yikarei
According to sources of the Philippine Star daily newspaper, applications by Oman Air and Jet Airways of India were both denied due to constricted infrastructure. The source at the Civil Aeronautics Board said that the foreign airlines are being denied not because of market related issues but rather due to infrastructure.

The Civil Aeronautics Board is responsible for issuing a Foreign Air Carrier's permit in order to permit an airline to operate international scheduled air transportation services in the country. For local carriers, it issues a Certificate of Public Convenience and Necessity to enable them to operate in the country. The CAB has granted Foreign Air Carrier permits to 39 foreign carriers as of 2012.

Oman Air is the flagship of the Sultanate of Oman. The denial of the carrier's application may not be favourable for the airline or its Philippine counterparts. Philippine Airlines released a statement in April that it was filing an application to fly directly to Muscat, Oman in early 2014. The airline's application requests for weekly seat entitlements equal to that granted the Oman carrier which is 4 frequencies. While the seat entitlements are in line with existing bilateral air service agreements between the two countries, the Sultanate of Oman may take issue with the fact that a Philippine carrier is planning to launch a route that its flag carrier was denied due to slot limitations and may issue a political response to Philippine Airlines declaring the same fate as Oman Air in the Philippines. PAL plans to launch four weekly flights on January 30, 2014.

The Philippines has long anticipated the return of carriers from Europe and North America following the removal of the common carriers tax on foreign carriers that was previously imposed along with the gross Philippine billings surcharges. The goal was to support the initiative to draw ten million tourists to the country by 2016 and make the country a major aviation hub for Southeast Asia. But unless the country can address the congestion issues and poor infrastructure at Ninoy Aquino International Airport in a timely manner, the country will have a much longer wait if it cannot even accept airlines that have already applied. The last direct flight between the Philippines and Europe operated by KLM was cancelled due to the taxes and surcharges imposed by the government in addition to a direct flight between Doha and Cebu operated by Qantas which was cancelled in 2012 citing the same reasons.

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