Fastjet’s woes nowhere near ending

Dar es Salaam. Yesterday, the Tanzania Civil Aviation Authority (TCAA) said that the validity of the licence of Fastjet Tanzania expired on January 3, 2019.

This was after the troubled airline failed to meet the air transport regulator’s criteria, including payment of licence fees and the relatively huge debt it owes TCAA.

But Fastjet’s executive chairman and majority shareholder Lawrence Masha told The Citizen a few days ago that discussions with TCAA on the related issues were still ongoing.

“Everything will be made public in due course. Kindly give us room so that we can finalise our talks with the regulator,” Mr Masha said in an exclusive telephone interview.

For his part, TCAA director general Hamza Johari told The Citizen yesterday that Fastjet – which owes TCAA, other service providers and assorted creditors a total of Sh7 billion – was required to obtain a new licence before January 3 this year, but failed to do so.

“They (Fastjet Tanzania) were supposed to protect their business licence by paying debts to TCAA, and also pay operating licence charges,” Mr Johari explained.

Fastjet requires an aviation licence which enables it to operate two types of services, namely: charter services, and scheduled flights.

The fee for each of the two services is $1,200, and the airline needed to pay a total of $2,400 (about Sh5.4 million) for a new licence before January 3, 2019.

On December 17 last year, TCAA issued a 28-day notice of intention to revoke the cash-strapped Fastjet’s operating licence over what the Authority described as ‘poor management’ that resulted in frequent flight cancellations.

In the event, the regulator required Fastjet to – among other things – pay all the debts it owed to its service providers, including unpaid licence charges to TCAA, and also officially appoint an ‘accountable manager’ who must be an expert in aviation matters.

The raft of conditions also included requiring the airline to prepare a business plan which would, among other issues, outline the airline’s future management structure.

This was deemed important after a change in Fastjet’s shareholders as announced late last year.

“Fastjet did not meet even one of the conditions that we outlined for it to qualify to operate in the country (Tanzania),” Mr Johari told The Citizen in the interview – adding that this was one of the reasons which led to the ceasing of its operating licence.

“They will have to apply for a new licence if and when they are able and ready to do so. We are willing to give them all the support needed.”

In the meantime, TCAA would hold Fastjet’s aircraft until the company pays all the debts it owes the regulator and other service providers. Earlier on, the regulator had revealed that Fastjet had only two aircraft (E190 Embraer), one of which was grounded for maintenance, while the other was recalled by the lessor.

According to Mr Johari, Fastjet did put together a business plan which it submitted to TCAA on December 22 last year – and which was officially received by the regulator two days later. However, the plan does not in any way indicate beyond doubt that the airline has enough money for it to survive in business.

Furthermore, Mr Masha – the company’s executive chairman whose name was submitted to TCAA on the same date as its ‘accountable manager’ – does not qualify for that position.

Even after advising them (Fastjet) to appoint a person with the requisite qualifications as ‘accountable manager’ before the expiry of the regulator’s notice on January 14, 2019, the airline still failed to do so, the TCAA chief stated – adding somewhat sagaciously that “it is not an easy task to attract a qualified accountable manager when the airline has no money!”

After expiration of the 28-day ultimatum, Mr Johari said, “Fastjet requested for more time to prepare themselves so that they can sort out the matter. We agreed – and we are ready to advise them because our goal is to give room for locals to invest in the aviation industry so that we can have healthy, effective competition.”