5 December 2011

Nigeria: BA Negotiates With NCAA On $135 Million Compensation

Lagos — After initial grandstanding, British Airways, BA, has gone into negotiation with Nigerian Civil Aviation Authority, NCAA, over the $135 million it was asked to pay to Nigerians as compensation, arising from fuel surcharge imposed on travellers in the country.

This came as NCAA, yesterday, set up a five-man panel to consider the legality and fairness of its investigations and fining of both British Airways and Virgin Atlantic Airways, with regards to their anti-competitive practices in respect of Passenger Fuel Surcharge, PFS.

Following NCAA face-off with BA and Virgin Atlantic, NCAA, yesterday, set up a five-man administrative panel to deliberate on its imposition of $235 million on British Airways and Virgin Atlantic airlines.

This is coming at a time some travellers are calling on the Federal Government to get to the end of efforts to make British carriers, British Airways and Virgin Atlantic Airways, force down fares charged on the London route from Lagos and Abuja.

The regulatory agency had slammed a $235 million fine on the two British carriers over the surcharge imposed on Nigerians, of which $100 million was to be paid by Virgin Atlantic Airways, but British Airways threatened to go to court, saying it committed no offence.

However, Vanguard learnt that the airline had now dumped the option of going to court and chosen to negotiate with the NCAA, with a view to paying less.

"You just don't expect them to have paid without wanting to see how they can negotiate down the figure. The fact that they are talking about negotiation is an indication that they committed an offence," a source told Vanguard, yesterday.

According to the source, if and when they are through with the negotiation, the outcome will be sent to the Minister of Aviation for approval.

Although the Minister could not be reached last night for her comments, but sources close to the ministry said the position of the Minister was that the two airlines must pay the compensation to Nigerians, especially as British Airways, particularly, paid a similar fine to the US Government for same offence.

Efforts to also reach the airline, yesterday, proved abortive as calls made to its media consultants in the country yielded no response, and not even text messages sent were also replied.

Travellers charge NCAA

Reacting to NCAA's decision to investigate other foreign airlines on high fares charged Nigerians, some travellers have asked the agency to pursue to its logical conclusion the charge against British Airways and Virgin Atlantic to avoid losing focus on the matter.

A regular traveller on Lagos-London route, Samuel Idoko, said a definitive position on the two British carriers would send appropriate signals to other foreign airlines flying into the country.

He said: "I'm a bit surprised that the NCAA is talking about probing other airlines when we have not heard anything concrete from BA/Virgin Atlantic case. The agency will be doing the public a world of good if it follows that matter to its logical conclusion before taking on new ones."

NCAA to probe other airlines

The NCAA had, last weekend, stated its resolve to investigate other foreign airlines flying into the country, with a view to ascertaining whether the fares they charge in Nigeria are in line with what they charge in other countries in West Africa.

But Musa Danladi, another regular traveller said in as much as government had done well in trying to prevent Nigerians from being exploited through high fares charged by foreign airlines, it should avoid losing focus by taking on too many airlines at the same time.

He said: "Let it come one after the other. After BA and Virgin Atlantic Airways, they can now take on others for maximum effectiveness, otherwise, we may lose this war, and this represents one good opportunity to address all these issues that have lingered for a long time."

The panel

The panel, chaired by retired Justice George Oguntade of the Supreme Court of Nigeria; Dr. Folarin Gbadebo-Smith; Mr Calloster Uwakwe; Alhaji Bala Ibn Na Allah; former Chairman, House Committee on Aviation, KGB Oguawa, and former House Chairman, House Committee on Tourism and Culture as members.

Director-General of NCAA, Dr. Harold Demuren, affirmed that the panel was made up of distinguished and accomplished professionals who would underscore the fairness of the NCAA process as far as its decision on BA and Virgin Atlantic Airways was concerned.

He said: "This is to underscore the fairness of the NCAA process and our desire that the best possible and most impartial evaluation of this extremely important issue occurs and to deepen and sustain the confidence the entire world has reposed in the Nigerian aviation sector over the past years as we have developed a world class industry."

"It is also a re-assurance to Nigerians that the NCAA, Federal Ministry of Aviation and the Federal Government of Nigeria remain totally focussed on protecting their rights, advancing their causes and ensuring that they are not subjected to unscrupulous practices that provide benefit only to specific interests, leaving both the consumers and the industry at large violated."

He said NCAA was determined in defending the rights of Nigerian passengers, noting that it would discourage and penalize any conduct that would violate the law in the country, especially with regards to exploitation of Nigerians.

"The Civil Aviation Act, Regulations as well as our other laws in Nigeria respect the rights of all parties and operators in our economy. This step is a further confirmation of that.

"While the NCAA again stands by the quality of its investigation, this is another opportunity for operators to see the methodical, dispassionate, and fair, open and confident manner in which the NCAA carries out its functions," Demuren said.

He noted that NCAA welcomed people and entities who have genuine interests in exploring Nigeria's market as well take advantage of the hospitality and opportunities in Nigeria.

He warned that the same market and opportunities would be closed to those whose interest was based on exploiting Nigerian people.

"NCAA is determined to follow this process to a full and final conclusion while respecting all persons rights and the law and at the same time bringing its entire full weight to bear and enforcing it to the letter," he added.

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