Tanzania Daily News (Dar es Salaam)

Tanzania: Fastjet Loses Operational Licence

IN yet another twist of events, Five Forty Aviation Limited has announced that it has withdrawn the licences it had granted to Lonrho Aviation (FastJet Africa Operations) in Tanzania, Angola and Ghana.

The withdrawal means that Lonrho Aviation has to stop using the Fly540 brand immediately due to its alleged failure to comply with respective agreements reached with Five Forty Aviation.

Interestingly, the Tanzania Civil Aviation Authority (TCCA) said yesterday that it had not received any official communication from Five Forty Aviation regarding the withdrawal.

"Fly540 was first licensed in Tanzania in 2008 and its licence was renewed in October last year. My office has not been informed of the said withdrawal," TCCA's Director General, Mr Fadhili Manongi, told 'Daily News' in a telephone interview.

In June last year, London Stock Exchange's listed FastJet, which was formerly known as Rubicon Diversified Investments Plc, acquired Lonrho Aviation and thus gaining control of assets and liabilities of the company in Tanzania, Angola, Kenya and Ghana.

The new company re-branded in Tanzania from Fly540 to FastJet Tanzania in November, last year, but it continued using Fly540 brand in Angola and Ghana. However, available information indicates that lawyers representing Five Forty Aviation wrote to the three African operations on January 24, this year, informing them on the intention to withdraw their licence to use the Fly540 brand if they did not comply with terms and conditions of the licence agreement within seven days.

Five Forty mentioned the conditions that had not been adhered to as payment of outstanding and other fees totalling US 6.9 million dollars in Tanzania as well as US 500,000 dollars and US 300,000 dollars in Angola and Ghana respectively. It also stated that contrary to licence agreement and despite several reminders, FastJet had not provided information to Five Forty's Head of Safety to demonstrate compliance with Fly540's accepted safety systems.

"As FastJet has failed to respond notice has been given to Fly540 Angola and Fly540 Ghana to re-paint their aircrafts. Also, as per licence agreement, Five Forty has written to civil aviation authorities in the three countries informing them of the withdrawal of the licence," the CEO of Five Forty, Don Smith, was quoted as saying.

In another development, it has also come to light that Canadian company Avmax Aircraft Leasing has written to FastJet saying it was removing the registration of three planes leased by its operations. The three aircrafts have allegedly run up unpaid leasing and maintenance bills of almost two million US dollars (approximately 3.2bn/-).

On its part, FastJet denied it owed the Canadian company anything, stating that there has never been a contractual arrangement between Avmax and FastJet. It maintained further that it is Don Smith through Fly540 in East Africa who entered into contractual relationship with Avmax and these commercial arrangements owes money to the Canadian company for unpaid aircraft lease rentals and maintenance.

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