Manila renews Philippine Airlines franchise for 25 years

The Philippines Parliament has endorsed a bill that renews for another 25 years a franchise granted to Philippine Airlines (PR, Manila Ninoy Aquino Int’l), and its subsidiaries PAL Express (2P, Manila Ninoy Aquino Int’l) and airphilexpress (2P, Manila Ninoy Aquino Int’l).

According to the official Journal of the House of Representatives, 168 lawmakers on November 22 unanimously endorsed on its third reading House bill Number 10442 renewing for another 25 years the franchise “to establish, operate, and maintain domestic and international air transport services” of Air Philippines Corporation dba Philippine Airlines, PAL Express; and airphilexpress.

Business Mirror reports the bill mandates the company to secure the appropriate permits and licenses for the “construction, development, establishment, operation, and maintenance of its airport properties or facilities from the Civil Aeronautics Board (CAB) and Civil Aviation Authority of the Philippines (CAAP)”.

It also mandates the company to maintain scheduled, non-scheduled, or chartered local and international air transport services. At least 25% of all its frequencies must be for the domestic market.

Under the franchise, the grantee must fix “just and reasonable rates” subject to the regulations and approval of the CAB and other regulatory agencies of the government.

The bill also reserves the right of the President of the Philippines to temporarily take over and operate the airport properties or facilities of the airline; to suspend the operation of the airport in the interest of public safety, security, and public welfare; or to authorise the temporary use and operation thereof by any agency of the government in times of war, rebellion, public peril, calamity, emergency, disaster, or disturbance of peace and order.

It also mandates the grantee to create employment opportunities and to comply with the applicable labour standards and allowances entitlement under existing labour laws.

Meanwhile, it prohibits the grantee from leasing, transferring, selling or assigning the franchise or the controlling interest thereof without the prior approval of the Congress of the Philippines.

The bill requires the grantee to offer to Filipino citizens at least 30% of its outstanding stock in any security exchange in the Philippines or through other methods of encouraging public participation by citizens and corporations.