Budget carrier Southeast Asian Airlines (SEAir) may continue operating flights using planes leased from its much bigger Singaporean partner Tiger Airways, a local court has ruled.
In a two-page June 17 decision made public this month, Judge Philbert Iturralde of the Angeles City Regional Trial Court (RTC) junked a petition questioning the legality of SEAir’s lease and marketing agreement with Tiger Airways, a budget airline partly owned by the Singapore government.
Iturralde said Cebu Air Inc., operator of budget carrier Cebu Pacific and the company that filed the petition against SEAir, failed to exhaust all administrative remedies before going to court.
The decision noted that Cebu Air, together with three other local airlines, namely Philippine Airlines (PAL), AirPhil Express and Zest Airways, had a pending case before the Civil Aeronautics Board (CAB) asking the regulator to junk the SEAir-Tiger partnership.
The judge added that SEAir, being duly-authorized to enter into contracts, “may likewise enter into transportation maintenance and servicing contracts and such other contracts relating to air transportation with other foreign-owned airlines, particularly with those which have international routes.”
SEAir president Avelino Zapanta welcomed the decision, and at the same time dismissed criticism against the company as mere efforts to curb increasing industry competition.
“If your organization has an inferior marketing and business plan, you are bound to suffer losses and damages; and you should not blame it on fair competition,” he said in a statement.
“Just provide good public service, ensure airline safety, and public convenience, then profit will flow naturally,” he added.
Zapanta said going to the CAB and the courts at the same time was tantamount to “forum-shopping,” saying its local rivals’ real aim was to “thwart legitimate competition.”
Cebu Pacific officials could not be reached for comment.
Under the questioned deal, SEAir will lease from Tiger Airways several aircraft that the local airline will use for international flights.
SEAir currently flies to Singapore, Hong Kong and Macau out of its hub in Clark Freeport, Pampanga, using planes from Tiger.
SEAir also planned to use Tiger planes for domestic flights to Cebu and Davao. However, the CAB issued a cease order against these planned domestic routes due to possible violations of the constitutional provision that bars foreign entities from providing transportation services within the country.