No legacy slots for India’s Jet Airways – ministry

The Indian Ministry of Civil Aviation (MoCA) has reaffirmed earlier statements and told the National Company Law Tribunal (NCLT) in an affidavit that reactivated Jet Airways (JAI, Mumbai Int’l) will not regain slots that predate its 2019 collapse and that it will have to reapply on general terms for new ones. “The RA [resolution applicant] can’t claim these slots as a matter of right under the present insolvency proceedings… The RA can’t claim historicity on the slots which were allotted to them for winter 2018 and summer 2019 season, as they failed to utilise 80% of the slots allotted to them and stopped their operation even before commencement of these insolvency proceedings,” the ministry argued. The airline suspended all operations in April 2019, shortly after the beginning of the Summer 2019 season. However, as its financial problems had dragged on for months before that date, Jet Airways had already begun to prune its network significantly during the Winter 2018/19 season, leading to the underutilisation of most of its allocated slots. Following the suspension of operations, the MoCA and its Directorate General of Civil Aviation (DGCA) reallocated all of Jet’s slots to other carriers to avoid inefficiencies at India’s more congested airports, Delhi Int’l and Mumbai Int’l in particular. “Many airlines like IndiGo Airlines, SpiceJet and GoAir etc. responded positively and invested huge amount of money and procured number of aircraft immediately and in fact, even outnumbered the figure which was reduced on account of suspension of operation by Jet Airways… now such entities can’t be deprived of these slots, without any valid reasons and also without any force of law,” the ministry stated. The affidavit was filed with the court on June 3, ahead of the hearing scheduled for June 4. The NCLT subsequently adjourned its session and will return to the topic next week. If the NCLT accepts MoCA’s argument, it may jeopardise the ongoing acquisition of Jet Airways by a consortium of Kalrock Capital and Murari Lal Jalan. They have repeatedly said that the slots are the airline’s most precious assets and that without them, their interest would be voided. Despite the ongoing dispute over historical slots which discouraged several earlier bidders (including German Efromovich’s Synergy Aerospace), the winning consortium decided to go ahead and submit a binding offer which garnered creditor approval in mid-October 2020 ahead of a planned late 2021 relaunch. The MoCA underlined that its position should not prevent Jet Airways, or any other carrier, from applying for new slots.