European Commission regulators are proposing extending by a further six months and widening the scope of the temporary relaxations around state aid rules under which a string of airlines have been supported through the global pandemic. As the coronavirus crisis hit the Commission introduced, through three separate amendments, temporary measures easing state aid rules around areas such as recapitalisation, sub-ordinated and the protection of jobs. These relaxations were due to expire at the end of the year, aside for recapitalisation measures that could already be granted until 30 June 2021. Countries across Europe have provided support for struggling airlines, among the hardest hit sectors from the pandemic, under the temporarily relaxed state aid rules. Amid the rise in virus cases across Europe, now competition commissioner Margrethe Vestager is proposing extending these measures until next summer - and expanding their scope. The Commission says the objective of extending existing provisions is to enable member states to support businesses during the coronavirus crisis, especially where the need or ability to use the temporary framework has not fully materialised so far. But citing “the continued economic uncertainty and the needs of businesses with significant turnover losses”, it is also proposing extending the scope of temporary framework to enable member states to contribute to the fixed costs of companies that are not covered by their revenues. ”Supporting these companies by contributing to part of their costs on a temporary basis aims at preventing the deterioration of their capital, maintaining their business activity and providing them with a strong platform to recover,” it says. The Commission is also adapting the conditions for recapitalisation measures under the temporary framework, in particular for the state’s exit from company’s where it was already a shareholder prior to the recapitalisation. ”The proposed changes would allow the state to exit from the equity of such enterprises through an independent valuation, whilst maintaining the safeguards to preserve effective competition in the single market. ”Over the past seven months, our State Aid Temporary Framework has paved the way for almost €3 trillion ($3.5 trillion) of member state potential support to businesses hit hardest by the coronavirus crisis,” says Vestager. ”The effects of the crisis will stay with us for a while. That’s why we are proposing to prolong the Temporary Framework until mid-next year and adjust it to continued needs of businesses, while protecting the EU’s Single Market. We will decide on the way forward taking into account the views of all member states.

Source: Cirium

South African Airways’ maintenance arm, SAA Technical, has started reinstating its services after suspending them to four customers over outstanding payments. It says it has reached an agreement with two of these customers – SAA itself and sister carrier Mango – but is still holding talks with the other two. SAA Technical chief executive Adam Voss says the company is seeking “resolution and settlement” on the issue. “The decision we took to suspend services to our customers was not taken lightly,” he adds. Voss points out that the maintenance firm’s staff had been “adversely impacted” by cash-flow problems, and paid only 25% of their salaries in September, and the company needed to protect its commercial interests. Suspension of aircraft services to SAA was lifted on 30 September, after making payments, and that against Mango on 2 October. The maintenance firm says it is discussing with unions the balance of payments for workers’ September salaries. “We know that many of our customers were not able to trade and generate much-needed revenue to pay for services rendered,” says Voss. But he adds that customers will have to provide “upfront payment” for SAA Technical work. “Discussions are ongoing with all affected customers to find solutions on how to address the legacy issues that resulted in the suspension of the maintenance services,” the company states.

Source: Cirium

Aviation trade group IATA has called on US jurisdictions to eliminate quarantine requirements imposed to prevent the spread of the coronavirus, advocating instead for systematic pre-departure testing protocols. “Mandatory arrival quarantines for air travellers have the same effect as outright border closures,” Peter Cerda, IATA’s regional vice-president for the Americas, said on 1 October. He adds that such restrictions will continue discouraging discretionary travel and prevent the industry from getting back on its feet. Instead of implementing job-destroying arrival quarantines, states should be encouraging the federal government to work with other governments to implement systematic pre-departure testing,” Cerda says. IATA says 64% of travellers surveyed agree that quarantines are unnecessary for those testing negative, and 80% are prepared to take pre-departure coronavirus tests. Just over half of respondents say the virus is in check enough to reopen the USA to foreign visitors. In March, the government halted all foreigners from entering the USA, leaving the border only open to citizens and permanent residents. But as the pandemic drags on, the virus is spreading unevenly across the country. Some states have been able to keep it in check with lockdowns and slow reopening's, while others have experienced surges in recent weeks. The New York City region and isolated Hawaii Islands are two areas that require 14-day quarantines for inbound passengers, effectively choking off tourism activity for the past several months Hawaii, for which tourism from both US and foreign visitors is an key part of the economy, will ease quarantine requirements on 15 October. If a passenger shows proof of a negative coronavirus test that is not more than 72h old they can bypass the mandated quarantine. This has prompted both Hawaiian Airlines and United Airlines to ramp up their schedules between the islands and the US mainland. New York, meantime, still requires self-isolation for passengers arriving from 34 other US states. Monitoring quarantined passengers remains a challenge for all jurisdictions, leading experts to question the effectiveness of such measures. Numerous airlines have introduced pre-departure screening programs aimed at encouraging customers to book travel in the coming weeks. The important Thanksgiving holiday long weekend, among the USA’s busiest travel weekends, is just eight weeks away. “These and other airline-led testing programs will provide valuable experience while the numbers of travellers are still low, so that testing can be efficiently ramped up as demand returns,” IATA adds. “Establishing systematic pre-departure testing is the key to unlocking global connectivity, stimulating battered economies, and giving hope to the 10% of the global workforce whose livelihoods depend on travel and tourism,” the trade group says.

Source: Cirium