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Vietnam’s private carrier Air Mekong loses license after 22-month hibernation

Friday, January 09, 2015, 11:51 GMT+7

Private Vietnamese carrier Air Mekong has had its air transport license voided as it failed to present a workable plan to resume business after a hiatus of more than 20 months, the Ministry of Transport said earlier this week.

The license Air Mekong obtained from the ministry on October 30, 2008 was dropped, the ministry said Tuesday in a directive that took effect the same day, 22 months after the airline’s last commercial flight.

The air transport license of an airline will be canceled if the carrier stops operating for 12 months in a row, according to Government Decree No. 30, which manages the aviation transport sector.

Air Mekong began offering commercial flights in October 2010, but had to suspend business to “restructure its fleet” as of March 1, 2013.

The airline then faced a license revocation by April 2014, when its air operator’s certificate was due for expiry.

An air operator's certificate, or AOC, is the approval granted by a national aviation authority to an aircraft operator to allow it to use airplanes for commercial purposes. The AOC is one of the crucial conditions for an airline to obtain the air transport license.

In order to avoid losing its license, in late March 2014 Air Mekong submitted its plan to resume operations and renew its AOC to the Civil Aviation Authority of Vietnam (CAAV).

The carrier also called on the transport ministry to help it retain its air transport license by January 2015.

The request was accepted, and Air Mekong was allowed to keep its license until December 31, 2014, according to a document signed by Deputy Minister of Transport Pham Quy Tieu on May 6, 2014.

The incentive was granted under conditions that the airline develop a detailed plan to resume business and present relevant documents on its restructuring process, financial and personnel plans, and airplane leases.

But when the deadline came due, Air Mekong did not submit any of the required reports.

The CAAV said its repeated attempts to contact Doan Quoc Viet, the legal representative of the airline, to work on the issue failed.

“The transport ministry and the CAAV created many conditions to help Air Mekong but the airline did not show that it was ready to resume operations in 2015,” said CAAV chief Lai Xuan Thanh.

The CAAV thus called on the transport ministry to pull the plug on the airline as it failed to meet requirements to keep the license as per Decree No. 30, Thanh added.

Air Mekong was Vietnam’s second privately owned carrier, besides Indochina Airlines, when it began operations in October 2010. In 2011, VietJet Air became the country’s third private airline.

Air Mekong consumed a combined VND1 trillion (US$46.6 million) in investments from its funder, BIM Group, during its first two years of operation.

The airline offered eight domestic services, including less competitive air routes such as Ho Chi Minh City – Con Dao Island.

VietJet Air is now the country’s only operational private carrier as Indochina Airlines, owned by Ha Hung Dung, commonly known as composer Ha Dung, also lost its license in late 2010.

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