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KUALA LUMPUR, Jan 31 — Budget airline AirAsia Berhad today initiated mediation efforts for its claim from the country’s airport operator for close to RM480 million in alleged losses from purportedly poor conditions at the low-cost terminal KLIA2.
In a statement, AirAsia said it served notice today for the commencement of mediation on Malaysia Airports Holdings Berhad’s (MAHB) wholly-owned subsidiary Malaysia Airports (Sepang) Sdn Bhd (MASSB).
AirAsia said its losses came up to a total of RM479,781,285, mainly from the loss of business in the past four years that it asserted was due to disruptions and poor conditions at the Kuala Lumpur International Airport 2 (KLIA2) terminal.
In the notice served on MASSB, AirAsia Berhad and its long-haul sister airline, AirAsia X Berhad, claimed the operator had provided a “poor level of service” at KLIA2 that resulted in the financial losses.
The two airlines listed out as flight cancellations and resulting loss of revenue from multiple runway closures, apron defects, damage to two aircraft due to malfunctions in MASSB’s infrastructure and sensors, a fuel line rupture at Pier P of the KLIA2, internet outages and loss of customers.
Both said they were jointly seeking mediation in line with the Malaysian Aviation Commission (Mavcom) Act 2015’s Section 74, which requires disputes to first be resolved through mediation.
Under the law, Mavcom will arbitrate the dispute if mediation fails.
The two airlines said they hoped to settle the issue amicably and had refrained from filing a counterclaim in court in order to pursue mediation first, as required by the Mavcom Act.
However, both said they reserved their rights to exhaust all avenues — including the option of going to court — to recover the incurred losses.
On January 23, AirAsia Berhad announced its counterclaim against MAHB, where the airline sought RM400 million in compensation for losses and damages allegedly resulting from operational disruptions at KLIA2.
The alleged disruptions were similar to those listed in the mediation notice.
The counterclaim was in response to MAHB’s lawsuit filed last year over outstanding airport taxes or passenger service charge (PSC) owed to MAHB.
AirAsia then also accused MAHB of breaching the Mavcom Act by filing the lawsuit, despite the law requiring both the airport operator and airlines to first seek mediation to resolve any dispute.
MAHB reportedly issued legal letters to both AirAsia and AirAsia X last October to demand payment for the outstanding PSC linked to increased PSC rates for international departures from KLIA2 owed since July 2018.
AirAsia has accrued around RM9.4 million in unpaid PSC while AAX was hit with a lawsuit seeking RM26.72 million for similar arrears.
AirAsia had objected to collecting the additional PSC rates on behalf of MAHB when it was raised from RM50 to RM73 at the start of 2018, arguing that the full-fledged KLIA and low-cost terminal of KLIA2 should not have the same fees as the level of service provided was different.