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Business News of Tuesday, 22 November 2022


FG, domestic airlines legal battle kicks off Thursday

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The Federal Government has assembled a legal team to challenge the suit filed by domestic airlines seeking to stop the establishment of a proposed national carrier-Nigeria Air.

It was learnt on Monday that the legal team of the government and a 10-man group representing the domestic airlines, would meet in court on Thursday in Lagos over issues pertaining to the proposed national airline.

The PUNCH had exclusively reported on November 14, 2022, that the national carrier project might be stopped by the court as domestic airlines had taken the Federal Government and Ethiopian Airlines-its foreign technical partner and majority shareholder-to court.

The 10-man legal team representing the domestic airlines include Nureini Jimoh, SAN; Prof. A.B. Ahmad; Prof. Y.B Hassan; Emmanuel Dike; Habiba Nuhu; Ashraf Yusuf; Abubakar Nuhu; Zainab Maiyaki; Opeyemi Ajekigbe; and U.F Abdullateef.

The hearing for the suit between the Federal Government and domestic airlines is due to be heard on Thursday, November 24, 2022, findings by The PUNCH have shown.

Officials of domestic airlines close to the suit confirmed the suit is slated for a hearing on Thursday.

“The battle begins on Thursday. Our lawyer has confirmed to us the suit will be heard on Thursday, November 24, 2022. The Federal Government lawyers will also be coming to represent the government. Our team of lawyers will be present,” a top official of a local carrier who chose to speak on condition of anonymity told The PUNCH on Monday.

“After the court hearing on Thursday, the Federal Government will be expected to file its comprehensive defence within one month. Failure to do that means it won’t have the opportunity again,

Meanwhile, the Managing Director, Top Brazz Aviation, one of the local carriers listed on the court paper, Mr Roland Iyayi, said he believes the domestic carriers have a strong case the court will decide upon.

He said, “We are absolutely prepared to pursue this. Based on what we presented to the court, we believe we have a very strong case. On the basis of the documents that we have presented, we believe we have a very strong case.”

Iyayi further explained, “Domestic airlines are not averse to having a national carrier. What we are saying is that the structure and the design that is being put together by the Honourable Minister of Aviation is a bit of an issue which we believe is not going to help the Nigerian state in a long term.

“We have also come to find out that there are undue privileges that are going to be given to this new carrier which domestic airlines are not enjoying. For instance, the government is proposing a 15-year tax moratorium. This is not a national carrier that is being presented, this is simply a flag carrier. We believe that ultimately, the Nigerian public will not benefit. There will be unfair competition.

“These are the issues we took to court, asking the court to determine whether or not we have a case. Already, ET has listed Nigeria Air as its subsidiary on its website. We are talking about unfair competition, contrived outcomes, lack of transparency and undue privileges that will ultimately result in a distorted market. At the end of the day, we will decimate the domestic market to the detriment of the consumers. In the absence of being unable to sit around a table to negotiate, we are left with no other choice but to go to court before it becomes too late.”

FG legal team

It was also gathered that the Federal Government had assembled a team of lawyers from the Federal Ministry of Justice, with some of them serving in the legal department of the Federal Ministry of Aviation, to challenge the suit by the domestic airlines.

Sources at the justice and aviation ministries confirmed that the Director of Legal Services at the FMA, Liman S.S., would lead the team on Thursday.

“They have many lawyers at the Federal Ministry of Justice and you know they work in a team,” a source at the aviation ministry, who requested not to be named, as he was not authorised to speak on the matter, stated.

Asked whether the ministry would engage the services of a private law firm, the source replied, “I can’t confirm that but I don’t think that will happen. This is because most times, for such issues, they don’t just engage external lawyers to do it.

“Rather they do it by themselves, don’t forget that the Attorney-General was named as a defendant in the suit. So I doubt if they will take it to a private firm. This is not the kind of issue that they will take to a private law firm.”

Also speaking on the issue, the official at the Federal Ministry of Justice stated that the head of legal services at the aviation ministry would lead the team.

“The head of the legal team at the Ministry of Aviation, who is from Zaria, Mr. Liman S. S., is the one leading the team of lawyers to challenge the suit.

“They have many lawyers in the legal department and these lawyers are to handle the case, except when there is the need for additional hands.”

But in a text message official response to our correspondent, the spokesperson of the Federal Ministry of Aviation, Eunice Akro, described the suit by the Airline Operators of Nigeria as uncertain.

Aviation ministry reacts
She pointed out that the FMA had yet to be served with the court processes of the suit.

Akro said, “The AON suit against the establishment of a national carrier is uncertain. We are aware of the rule that prevents discussion on matters that are already before a court of law.

“The Federal Ministry of Aviation and perhaps the other defendants in the suit are yet to be served with the court processes of the suit and the court order for the ex parte application.”

The PUNCH also reported last week that Federal High Court, Lagos Judicial Division, on November 15, 2022, issued an order of interim injunction restraining the Federal Government from executing the proposed establishment of the national carrier – Nigeria Air.

But the Federal Government, through its Minister of Aviation, Hadi Sirika, declared on the same day that no law in Nigeria could stop the national carrier project.

On their part, domestic airlines alleged that the sale of shares of the proposed airline violated the Companies and Allied Matters Act, as well as that of the Securities and Exchange Commission.

The document containing the Federal High Court’s order of interim injunction, with reference: FHC/L/CS/219/2022, indicated that the registered trustees of the Airline Operators of Nigeria were the plaintiff in the suit.

It named the four defendants to include Nigeria Air Limited – first defendant, Ethiopian Airlines – second defendant, Senator Hadi Sirika (aviation minister) – third defendant, and the Attorney-General of the Federation (Abubakar Malami) – fourth defendant.

This followed The PUNCH’s earlier exclusive report on November 14, 2022, that the national carrier project might be stopped by the court due to the suit by the domestic airlines.

The report stated that about eight local airlines and their association took the government to court on Friday, listing Nigerian Air, Ethiopian Airlines, Minister of Aviation, Hadi Sirika, and Attorney-General of the Federation, Abubakar Malami, as defendants.

Among other prayers, the indigenous airlines want the court to stop the national carrier deal and withdraw the Air Transport Licence already issued to Nigeria Air by the Federal Government/Nigerian Civil Aviation Authority.

They also claimed that the firm which served as Transaction Adviser for the transaction was incorporated in March last year and alleged that the company was linked to the aviation minister.

The local airlines further alleged that ATL issued to Nigeria Air did not pass through the normal security clearance.