PHILIPPINE Airlines (PAL) on Friday settled its P6 billion debt to the the Manila International Airport Authority (MIAA) and Civil Aviation Authority of the Philippines (CAAP).

In a joint statement, the Department of Transportation (DOTr), MIAA and CAAP said the flag carrier paid P6 billion in air navigational charges which have been incurred since the 1970s until July 30, 2017.

PAL Vice President for Legal Affairs Clara De Castro personally handed over a check for P5,677,887,615 to CAAP Chief Accountant Raul Eusebio at the latter’s office in Pasay City.

PAL also turned over a check worth P258,594,230.33, net of taxes, to MIAA Assistant General Manager for Finance and Administration Arlene Britanico.

PAL was given until December to settle its outstanding debt to the government.

Last month, DOTr said it accepted PAL’s P6 billion offer to settle its dispute with the government over unpaid fees.

“The DOTr has accepted the offer of PAL to pay in full the P6 billion claims of the CAAP/MIAA, and PAL commits to keep all their transactions updated and current with the CAAP/MIAA,” the DoTR had said.

At that time, PAL said it agreed to settle in order “to manifest their trust and confidence to (sic) President Rodrigo R. Duterte’s administration.”

The agreement came after Mr. Duterte on Sept. 26 gave PAL ten days to pay up or else he will cut off the flag carrier’s access to the Ninoy Aquino International Airport (NAIA) Terminal 2.

The DoTR then issued a final demand for PAL to fully pay its obligations, threatening legal action “to protect the interest of the government.”

According to the DoTR, PAL’s unpaid navigational fees and other charges reached P7.3 billion as of Sept. 26, 2017. This includes P6.96 billion payable to CAAP as of July 30, and P322.11 million to MIAA as of Sept. 26.

The issue over PAL’s unpaid charges had remained unresolved under the previous administrations.

When PAL was still owned by the government, it had enjoyed privileges such waiver of landing, take-off, and other fees at the NAIA.

However, the government insisted that PAL is no longer entitled to such privileges, since it was privatized in 1992. The flag carrier is now owned by tycoon Lucio Tan. – A.G.A. Mogato

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