AirAsia files judicial review to compel Mavcom to settle dispute with MAHB

By ALIFAH ZAINUDDIN / Pic By BLOOMBERG

AirAsia Group Bhd and its affiliate, AirAsia X Bhd, have filed for a judicial review against the Malaysian Aviation Commission (Mavcom) for the regulator’s alleged failure to decide on the low-cost carriers’ ongoing disputes with Malaysia Airports Holdings Bhd (MAHB).

According to AirAsia, Mavcom has refused to decide on the series of legal disputes between the airlines and Malaysia Airports (Sepang) Sdn Bhd (MASSB) on the passenger service charges (PSCs) and poor level of services at the Kuala Lumpur International Airport 2 (KLIA2).

“The low-cost airlines have tried to engage both MASSB and Mavcom to resolve the disputes through the statutory dispute structure provided by the Mavcom Act 2015.

“However, Mavcom has, through two letters dated Feb 28, 2019 and March 18,2019, refused to decide on the disputes on the basis that ‘the interpretation and applicability of Sections 74 and 75 of the Mavcom Act are currently pending disposal by the court’,” AirAsia said in a statement yesterday.

Thus, the airlines are seeking an order of mandamus to compel Mavcom to arbitrate on the disputes between AirAsia, AirAsia X and MASSB in accordance with its statutory duty.

A mandamus is a judicial remedy in the form of a court order which commands an individual, organisation, government or court to perform some specific act which that body is obliged under law to do, and in certain cases, one of statutory duty.

The two budget carriers said Mavcom has a statutory duty to decide on the said disputes once mediation between the parties have failed, or is deemed to have failed. The refusal on Mavcom’s part to decide on the said disputes is therefore contrary to Sections 74 to 78 of the Mavcom Act.

MASSB in December 2018 filed a lawsuit against AirAsia and AirAsia X, seeking RM9.4 million and RM26.72 million in unpaid PSCs respectively.

AirAsia later retaliated earlier this year by filing a legal claim for RM400 million for losses and damages experienced by the group via operation disruptions at KLIA2.

The legal spat had resulted in share price losses for all three public-listed firms.

Common shareholder Employees Provident Fund (EPF) had cautioned that the battle is damaging for both companies and the country, given their role in the Malaysian tourism sector.

The PSC has been the point of contention between the airport operator and AirAsia after the government’s decision to streamline PSC rates across all international airports in the country.

AirAsia has remained steadfast in its claim that KLIA2 — the frills-free airline’s homeground — should not be imposed the same rate as the KLIA Main Terminal. AirAsia claimed that KLIA2 airport facilities are below par compared to the Main Terminal.