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Seven HK Airlines aircraft impounded by HK airport authority

AIRPORT Authority Hong Kong (HK) has impounded seven aircraft under cash-strapped Hong Kong Airlines that have been idling at Hong Kong International Airport (HKIA), according to a South China Morning Post report

17 December 2019 - 19:00

AIRPORT Authority Hong Kong (HK) has impounded seven aircraft under cash-strapped Hong Kong Airlines that have been idling at Hong Kong International Airport (HKIA), according to a South China Morning Post report.

HK said in a statement that it had invoked section 40 of the Airport Authority Ordinance to take control of planes under the airline. The section deals with the detention of aircraft.



'The HK has acted ?to detain seven idle aircraft of Hong Kong Airlines in order to protect financial interests,' the authority said.



Hong Kong Airlines came under heavy scrutiny from regulators over its deteriorating finances, and was on the brink of collapse but found cash two weekends ago to narrowly avoid shutting down.



The airline, acknowledging the latest move, said its operations remained normal. A spokeswoman for Hong Kong Airlines said: 'Due to network consolidation, some of our aircraft have not been scheduled for operation and are currently suspended from service under the Airport Authority's arrangement. Our current operation remains normal.'



The seven aircraft have not flown for three to 11 months and according to industry data, most of the planes affected are owned by the airline or a leasing company linked to its controlling shareholder, mainland China's HNA Group.



'HK's detention action will help protect the financial interests of both HK and the government,' the Civil Aviation Department in Hong Kong said.



The authority charges airlines for every 15 minutes they park an aircraft at Hong Kong's airport. The airline had stored seven planes, ranging from 56 to 318 days, as of Sunday, meaning they had been racking up fees owed to the authority.



According to a calculation carried out by the newspaper shows that the seven aircraft has been parked for a total of 1,220 days or 29,280 hours. The airport charges from HKD94 (US$12.05) per 15 minutes in the cheapest parking area, including the maintenance apron, to HKD147 in remote parking stands.



Based on the two sets of fees, Hong Kong Airlines owes between HKD11 million and HKD17.2 million.



Two planes affected were Airbus A350s, registered B-LGE and B-LGH, which were leased from Kuwaiti firm ALAFCO, whose Irish subsidiary on December 10 pursued Hong Kong Airlines in the High Court for HKD364 million in unpaid rent on aircraft. One of the planes, which had been grounded since October 20, resumed flying on December 14, the SCMP reported.


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