Thai Airways International (TG, Bangkok Suvarnabhumi) has landed itself in hot water with Laotian officials for allowing its Thai Smile (Bangkok Suvarnabhumi) subsidiary to operate Bangkok Suvarnabhumi to Vientiane flights on its behalf.

The Bangkok Post says the Department of Civil Aviation of Lao PDR (DCA) recently warned the Thai national carrier that its continued use of Thai Smile aircraft and crew on flights to Vientiane were in violation of the terms and regulations of the Thai-Laotian Bilateral Air Services Agreement (BASA).

In a letter written late last month, the DCA claims the use of Thai Smile, a budget carrier in essence, has given Thai Airways International an unfair competitive advantage that local operator, Lao Airlines (QV, Vientiane), cannot match.

As such, the DCA has demanded the five Thai Smile A320-200s used on to the route be repainted in Thai's official livery while all flights crews deployed on the route must be fully trained and accredited by Thai itself and not by a third party as is the practice with Thai Smile.