Malaysia Airports Holdings and Capital A (formerly AirAsia Group) have ceased all legal proceedings between them, the two groups have said, ending long-running disputes and putting “growth for both the industry and the country” ahead of costly litigation.
Capital A confirmed “the discontinuance of legal proceedings between all parties” in a Bursa Malaysia stock exchange filing on August 11 after the groups issued a joint statement the previous day.
“As the world recovers from the pandemic and substantial losses in the aviation sector in particular, it is integral that all stakeholders work together to stimulate air travel revival,” said Capital A CEO Tony Fernandes. “As two major players driving the aviation ecosystem, it is now more important than ever that Malaysia Airports Holdings and our Malaysia-based airlines, AirAsia and AirAsia X, show solidarity in making Malaysia’s aviation industry competitive and attractive again.”
The statements did not provide further specifics related to the now-extinguished cases.
One dispute concerned a lawsuit the majority state-owned airport group filed over outstanding Passenger Service Charge payments. It was claiming a total of MYR41.55 million ringgit (USD9.1 million) against the two low-cost carriers, comprising the outstanding charges, late payment fees, and legal costs. According to the airlines, the airport operator had unilaterally revised the fees in 2016, breaching a contract between the two sides. In March 2022, the Court of Appeal of Malaysia dismissed attempts by the airlines to set aside a High Court ruling without a full trial having to go ahead.
In a separate clash, AirAsia and AirAsia X were trying to sue Malaysia Airports for what they alleged were losses and damages sustained between 2014 and 2018 due to negligence, multiple disruptions, and poor conditions at KLIA2, the second terminal at Kuala Lumpur International where low-cost carriers operate. Also in March 2022, Kuala Lumpur High Court dismissed an application from Malaysia Airports to strike out the two carriers’ claim for MYR479.8 million (USD105 million).
