Azman Air’s Air Transport License (ATL) is being withheld, according to the Nigerian Civil Aviation Authority (NCAA), unless the airline submits the necessary paperwork for the renewal of its operational license.
The regulator advised the airline to execute an MoU outlining how it would pay the N1.2 billion legacy debt incurred through the collection of passenger service charges ( PSC).
The Director-General of NCAA, Capt. Musa Nuhu, in a statement on the development, said the airline was suspended for failure to also submit security clearance for the renewal of its ATL, which expired in April 2021.
Nuhu said the N1.2 billion debt was the revenue accrued from the five percent Ticket Sales Charge (TSC) and Cargo Sales Charge (CSC), collected from air travelers by the airline.
While the NCAA gets 58 percent from the total 5 percent of TSC/CSC as major revenue earning for the agency, the other four agencies share the remaining 42 percent.
Azman Air was granted AOC in May 2014 by the NCAA following a two-year-long certification process. The airline commenced flight services immediately with its inaugural flight to Kano from Lagos.
The document issued to Azman Air allowed it to operate as a passenger, cargo, scheduled, and charter flight operator. The certificate is renewed every two years in Nigeria by the NCAA. However, the withdrawal of the airline’s ATL rendered its Air Operator Certificate (AOC) invalid.
According to Nuhu, its management had several talks with Azman Air’s management regarding how to repay the debt but neither party was able to come to an agreement.
Nuhu lamented that despite repeated attempts by the regulatory body to have the airline pay back the debt after collecting it from customers, “the carrier was refractory in paying back the cash.”
He said that the airline’s management had promised to pay back the sum of N10 million monthly as part of the N1.2 billion debt, but said the regulatory body insisted on N50 million monthly.
Nuhu also said that the airline could not provide its security clearance, which was one of the prerequisites for the renewal of ATL.
“We didn’t suspend Azman Air’s airline operator certificate but suspended their ATL, which had earlier expired.
“The ATL earlier expired in April 2021, but we gave the airline extension because of the disruption to aviation activities by the COVID-19 pandemic.
“This is what we did for other airlines, too. However, we wrote a reminder letter to the airline six months to the new expiring date, which is statutory. Later, the airline requested another extension of 90 days, but we only granted it 60 days.
“At the expiration of the 60 days, we also gave it 30 days reminder, which elapsed on Wednesday night, yet nothing was done by the airline”, Nuhu said, adding that the airline owed N1.2 billion as TSC/CSC.
“We invited them and set up a committee for that purpose. Azman said they would pay the sum of N10 million monthly out of the debt, which we refused. They later came up to N20 million, but we insisted on N50 million monthly.
“If we had agreed to the N10 million monthly, it means it will take them about 12 years to repay back the money it had already collected, and by then, the money would have been lost,” he said.