The Mexican government has rejected a union plea to take control of Interjet (Toluca) as the beleaguered carrier axed all of its flights until at least December 18 and IATA suspended its participation in its Billing & Settlement Plan (BSP), local media reported. But the country’s tax regulator and airport services provider are pressuring the company to pay its debts.
IATA sent a letter to IATA-accredited travel agents on Monday, December 14, asking them to suspend all Interjet ticketing activities. Suspension from the BSP means that accredited travel agents will no longer sell the airline’s tickets, nor will the agents be able to process any billings or refunds through IATA’s system.
“BSP travel agents should immediately suspend all ticketing activities on behalf of Interjet, including the use of all automated systems for processing refunds or other transactions on Interjet’s behalf,” the letter said.
According to its Resolution 850, IATA can order the suspension of an airline’s ticket sales when it owes payments via the BSP, when it ceases all scheduled passenger operations, or when it enters a bankruptcy process. The association asked the agencies to pay any outstanding settlements with Interjet directly.
On the same day, Mexico’s government said was not interested in requisitioning Interjet, responding to a plea from Sección 15, the social justice wing of the country’s biggest union confederation (Confederación de Trabajadores de México - CTM). Employee representatives met representatives of the Interior Ministry, who explained to them that nationalisation of the airline was not feasible.
“A group of pilots and employees was organised because they wanted to have time to speak with the president. A meeting was held with people from the government, where they explained that they do not want to carry out an investigation. They do not want the responsibility of doing it,” one of the employees told the newspaper El Financiero.
Instead, the ministry proposed holding a new meeting with Alejandro Del Valle, the company’s majority shareholder, together with the workers, to reach an agreement. As previously reported, Interjet investor del Valle reportedly acquired a 90% stake in the carrier two weeks ago and assumed the position of president and chairman of the board.
However, the last time a meeting was staged between del Valle and the authorities, he promised to make back payments of wages, a situation that has yet to be resolved. The company reportedly owes some 4,000 workers six fortnightly salary payments known as quincenas.
Sección 15 has warned that if Interjet were to file for bankruptcy, the government would lose MXN7 billion pesos (USD351 million) in unpaid taxes and MXN350 million (USD17.5 million) in Mexican social security and housing fund payments.
Meanwhile, on December 15, former employees who have been dismissed since March filed 50 claims against Interjet for unpaid severance amounting to MXN11 million (USD552,000). They claim to have not been paid any of the money they are legally owed.
Interjet took the step of grounding all of its flights for the third time on December 11. Mexico’s state-owned aviation fuel provider Airports and Auxiliary Services (Aeropuertos y Servicios Auxiliares - ASA) has indicated that the carrier owed almost MXN1.2 billion (USD61 million) in fuel as of October 31. According to Forbes Mexico, ASA suspended the supply of fuel on credit to the airline in April, so that it has had to pay for fuel before using it.
Tax regulators also aim to force the airline to comply with its obligations. The Tax Administration Service (Servicio de Administración Tributaria - SAT) has pointed out that if it did not do so it would move “against those jointly responsible” to fulfil their obligations and may force the airline to auction off its resources, as tax chief Raquel Buenrostro put it in an interview with newspaper La Razón. According to SAT documents, Interjet owes in excess of USD100 million in income, VAT, and airport taxes.
