The Malaysian Aviation Commission (MAVCOM) and the Department of Civil Aviation (DCA) have revoked Rayani Air's Air Services Licence (ASL) and Air Operator's Certificate (AOC) effective immediately.
The Shariah-compliant carrier suspended all flights in April following a series of technical problems and crew strikes that had beset its operations since its launch in late December 2015.
The DCA and MAVCOM subsequently initiated separate investigations into the airline's internal processes.
In a show-cause letter dated May 25, MAVCOM gave management 14 days to submit written proof of its ability to sustain future operations. The deadline, however, was never met resulting in the withdrawal of its ASL.
"MAVCOM has found that Rayani Air (Langkawi) had breached the conditions of its ASL and lacks the financial and management capacity to continue operating as a commercial airline," a statement said. "As a consequence, Rayani Air can no longer operate as a commercial airline with effect from today [June 13, 2016]."
The DCA, for its part, says it had based its decision to revoke Rayani Air's AOC on an audit of its administration and safety oversight protocols.
Earlier this month, local media did report that five potential investors had shown an interest in taking over the carrier.
Rayani Air is jointly owned by local oil and gas firm, Merdeka Jayabumi Enterprise, and mining company, Terus Maju Metal, and operated two B737-400s on domestic Malaysian flights.
