AirAsia and MAHB Still in Open Conflict over Airport’s Services and Fees

MAHB. KLIA, AIrAsia Group, airport's fees

AirAsia is clashing with Malaysia Airports Authority MAHB- which runs KLIA1 and KLIA2, over airport’s fees. The airline group just filed a lawsuit claiming RM479.78 million (US$115 million) to the airport’s operator. 

The feud continues between Malaysia Airports Holdings Bhd and the AirAsia Group over airport’s fees and the claim of a lack of services at KLIA2 following the rise of passengers’ fees. AirAsia and AirAsia  filed a lawsuit against MAHB Kuala Lumpur affiliate Malaysia Airports (Sepang) Sdn Bhd (MASSB), claiming for RM479.78 million (US$115 million).

In its writ of summons at the Kuala Lumpur High Court against MASSB, the airline mentions the loss and damages caused by negligence on the part of MASSB relating to provision of services and facilities at KLIA 2, according to the two firms’ filings with the stock exchange.

They said further updates of any material development on the matter will be made from time to time in compliance of Bursa’s Main Market Listing Requirements. Two weeks ago, AAB and AirAsia X paid RM41.54 million to MASSB to defray the garnishee execution proceedings in relation to MASSB’s claim for additional passenger services charges (PSC).

However, the payment was made without prejudice to AAB and AAX’s rights in the appeals made in relation to the judgement order dated July 18, 2019.

In between, the airline is applying again a educed passenger service charge (PSC) at KLIA2 and other international airports in Malaysia where it operates. This follows last month’s announcement by the Malaysian Minister of Transport Anthony Loke of the Cabinet’s decision to revise downward the PSC for passengers travelling outside of Asean from RM73 to RM50 effective Oct 1.

“We fully respect the Cabinet’s decision and as per the minister’s announcement, we will proceed with charging the reduced PSC from 1 October 2019. As the airports belong to the Government, the Cabinet certainly has every power to implement changes to the PSC,” AirAsia Group President (Airlines) Bo Lingam .

He said the fact that the Cabinet had chosen to reduce the applicable PSC to RM50 demonstrates that the PSC rates set by the Malaysian Aviation Commission were maximum rates rather than fixed rates, consistent with statements made by Mavcom.