NCAA suspends ‘no-pay, no-service’ directive against airlines over outstanding charges

The Nigerian Civil Aviation Authority (NCAA) has suspended its earlier “no-pay, no-service” directive issued against domestic airlines over outstanding statutory remittances owed to the regulator.

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The authority announced the decision in a statement issued on Sunday evening by the Director-General of Civil Aviation, Chris Najomo.

The suspension comes barely two days after the NCAA directed its departments and regional offices to withhold services from 11 domestic operators over unpaid financial obligations.

PREMIUM TIMES had earlier reported that the directive was contained in an internal memo dated 22 May and signed by the Director of Finance and Accounts, Olufemi Odukoya. The memo instructed all NCAA directorates and regional offices to place the affected airlines on a “no-pay-no-service” arrangement pending financial clearance from the Directorate of Finance and Accounts.

Airlines affected by the directive include Air Peace, Ibom Air, Arik Air, United Nigeria Airlines, Max Air, Rano Air, NG Eagle, ValueJet, Overland Airways, Umza Air and Caverton Helicopters.

The earlier directive had raised concerns within the aviation industry over the possible impact on airline operations, especially as domestic carriers continue to face rising aviation fuel costs, foreign exchange pressures and other operating challenges.

Under the arrangement, affected airlines risked losing access to some regulatory services until their outstanding obligations were settled.

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In the latest statement, however, the NCAA said the enforcement of the directive had been temporarily suspended following extensive consultations within the aviation sector and a review of prevailing operating realities.

According to the authority, the decision was taken in consideration of the rising cost of Jet A1 aviation fuel and its impact on airline operations and overall industry stability.

“The previously communicated enforcement of the ‘no pay, no service’ directive in respect of certain airlines with outstanding statutory remittances has been temporarily suspended,” the statement said.

The NCAA, however, clarified that the suspension does not amount to a cancellation, waiver or forgiveness of the debts owed by the airlines.

“It is important to state clearly that this suspension does not represent a cancellation, waiver, or forgiveness of outstanding statutory financial obligations,” the authority added.

The regulator also referenced the federal government’s earlier intervention approving a 30 per cent discount on some charges owed by domestic airlines to aviation agencies, including the NCAA.

According to the authority, the measure forms part of efforts to cushion the impact of rising aviation fuel prices and stabilise airline operations across the country.

ALSO READ: NCAA directs suspension of services to 11 airlines over unpaid charges

The NCAA explained that airlines remain responsible for remitting statutory charges collected from passengers through ticket and cargo sales.

It noted that the five per cent Ticket and Cargo Sales Charge is backed by the Civil Aviation Act and is not part of airline revenue or operating profit.

“The funds derived from statutory charges are therefore not only essential, but critical, to sustain oversight functions,” the statement added.

The authority said it would continue engagements with the affected airlines individually to ensure recovery of the outstanding debts while maintaining operational stability within the aviation sector.

In recent months, several domestic airlines have struggled with rising operating costs, aircraft maintenance challenges and rising aviation fuel prices, leading to schedule disruptions, route suspensions and mounting financial pressure across the sector.