Dr Mahathir: Offset not bribery in business deals if used for specific purpose

It is up to the public to judge the bribery scandal involving AirAsia and AAX, but the govt always seeks offsets when buying equipments, says PM


THE government had asked for an offset and channelled the amount for specific purposes following expensive deals in the past and was not construed as a bribe unless the amount went into “the pocket” of individuals, said Prime Minister (PM) Tun Dr Mahathir Mohamad (picture).

Dr Mahathir said it is up to the public to judge the bribery scandal involving top AirAsia Group Bhd and AirAsia X Bhd (AAX), but the government has sought offsets for lucrative equipment purchases.

“I hear there are allegations that AirAsia is involved in corruption. I am hesitant to comment, but usually when governments buy equipments, we always ask for an offset.

“For example, when we buy an airplane, we ask for an offset and whether we consider the offset as bribery or not, that is up to you. For me, if we can get something because we buy something at a high price, why can’t we accept it? Unless the money went into your pocket, now that is bribery.

“If it was for a specific purpose, it is considered an offset, not bribery. That is my opinion,” he said in Putrajaya yesterday.

In the past, Malaysia had purchased fighter jets and planes, and in return sought offsets in the form of setting up engineering, technical, and maintenance, repair and overhaul (MRO) centres.

AirAsia and AAX are embroiled in a bribery scandal which saw its top executive and founder taking a two-month garden leave as both listed firms initiate internal probes.

The allegations are related to a deal inked by the carriers with European planemaker Airbus SE.

Britain’s Serious Fraud Office (SFO) claimed that Airbus paid a bribe of US$50 million (RM205.7 million) to win plane orders from Asia’s largest budget carrier. Air- Asia has an all-Airbus fleet of 274 planes.

The SFO said Airbus agreed to a sponsorship deal with a sports team owned by the two AirAsia executives while negotiating for airplane orders. The Malaysian Anti-Corruption Commission and the Securities Commission Malaysia have launched separate investigations.

The Malaysian Aviation Commission would assess the fitness and propriety of executives in AirAsia and AAX to determine whether there is any contravention of the Malaysian Aviation Commission Act 2015 (Act 771) and the commission’s Guidelines on Fit and Proper Person.

AirAsia’s executive chairman Datuk Kamarudin Meranun and CEO Tan Sri Dr Tony Fernandes relinquished their executive positions for two months, although both aviation tycoons would remain as advisors. Fernandes and Kamarudin maintained their innocence over the allegation.

The bribery allegation hit the companies hard with AirAsia shares plunging to RM1.15, its lowest in five years on Tuesday. Shares of AAX also fell to an all-time low of 12 sen this week.

The allegations were exposed last week as part of a US$4 billion settlement Airbus agreed with French, British and US authorities. Prosecutors said the company had bribed public officials as part of its corrupt business practices. Airbus said it would not comment on investigations in Malaysia.