Code Share equivalent to use of entitlements

No more entitlements to UAE, new bilateral's necessary

By Lenie Lectura
BusinessMirror

March 20, 2012

Seeking for additional flight entitlements to the Middle East could resolve a complaint filed by Cebu Pacific against the Philippine Airlines (PAL) before the Civil Aeronautics Board (CAB).

“We are having air talks with United Arab Emirates this year so the issue may be overtaken by this,” said CAB Executive Director Carmelo Arcilla. He did not say when the negotiations would take place.

Cebu Pacific wants the government to recall some of Philippine Airlines’ (PAL) flight entitlements to the Middle East after the flag carrier stopped its direct flights.

The Gokongwei-owned Cebu Pacific asked the CAB to recall half of the 14 flight entitlements awarded to PAL to fly to United Arab Emirates (UAE). Cebu Pacific is also eyeing for PAL’s Saudi Arabia entitlements.

Cebu Pacific said that since PAL is no longer mounting direct flights in the Middle East countries, the CAB might as well reallocate these to airlines in need of entitlements.

But PAL, said its President Jaime Bautista, flies to those destinations via a code-share agreement with foreign airlines.

“We can fly there if we want. However, we thought at this time that it’s better to code share with others. I think they [CAB] can’t take it away because of the code share agreement we have,” the PAL official said when sought for comment.

PAL flies 14 times a week to Dubai and Abu Dhabi, eight times a week to Bahrain, and seven times a week to Doha, Qatar.

The carrier stopped its direct flights to UAE in 1998. PAL also canceled its Manila-Riyadh route in March 2011.

The CAB said it would be difficult to comment on Cebu Pacific’s complaint now, citing a contract inked with PAL and with a foreign airline.

“When you say that it’s not being used it is complicated because it’s under code share and a subject matter involving a contract between two private entities. If it’s really not being used then we can take it away as we have done before [with] other complaints. But if it’s under code share then that is another question. It is not that easy when something is a subject matter of a contract,” commented Arcilla.

Cebu Pacific announced plans to launch long-haul operations in the third quarter of 2013. Among the destinations being considered are parts of Europe, Middle East, Australia and the United States.