MANILA: Flag carrier Philippine Airlines (PAL) settled yesterday its P6 billion in unpaid navigational fees and other charges to the government. In a statement, the Department of Transportation (DOTr) said Clara de Castro, PAL vice president for legal affairs, brought the checks to the office of the Civil Aviation Authority of the Philippines (CAAP) in Pasay City yesterday. A check for P5.68 billion was turned over to CAAP chief accountant Raul Eusebio, while a check for P258.59 million was given to Arlene Britanico, general manager for finance of the Manila International Airport Authority (MIAA). Last month, the DOTr said it accepted the offer of PAL to pay in full the P6 billion in upaid obligations to the government.
Discussions were held as President Duterte threatened to shut down Terminal 2 of the Ninoy Aquino International Airport (NAIA) if the carrier fails to settle the arrears. PAL has been exclusively using T2 since 1999. Last September, the DOTr also warned it would take legal action against PAL if it fails to pay the navigational fees and other charges amounting to P7.28 billion. PAL president and chief operating officer Jaime Bautista said late last month the flag carrier expects to incur losses as it has to borrow to pay the P6 billion it owes the government. “It will affect our cash flow,” he said. As of end-June, PAL operator PAL Holdings Inc. reported a net loss of P1.66 billion, a reversal of the P4.61 billion net income in the same period last year due to higher expenses and fuel costs.
