We'll ground you

Challenge Air SA's Namibian representative says Air Namibia's planes that land in Frankfurt “can be grounded today” if the national carrier refuses to negotiate the repayment of a N$400 million debt.

12 February 2019 | Transport

Belgian aviation firm Challenge Air SA's local representative, Wilhelm Shali, says Air Namibia's German bank accounts will continue to lose money until it complies with a court judgment delivered in that country.

Shali also raised the spectre of Air Namibia's planes being grounded in Frankfurt.

“The planes can be grounded today. If they do not negotiate with us, we will ground the planes. The lawyers are enforcing this in Europe and not Namibia.

“Whether they acknowledge us or not, we have no problem,” added Shali.

“We don't want to talk about the case, we want to talk about the judgment and I have the full mandate to represent Challenge Air.”

Shali is said to have twice blocked attempts to ground Air Namibia's planes, with the first attempt being made on Christmas Day and the second last week Sunday.

“I stopped the grounding of the planes. They [Challenge Air] wanted to ground. I am the only one stopping the grounding of the planes,” he said.

According to Shali, Challenge Air had succeeded in freezing Air Namibia's bank accounts and made it impossible for it to open other bank accounts.

Air Namibia says it will not engage with Shali over the N$400 million it was instructed to pay to the liquidated Belgian aviation company.

Air Namibia spokesperson Paulus Nakawa has insisted that it would not be recognising Shali, Challenge Air SA's local representative.

“The fact that local representatives are authorised to represent Challenge Air in the matter, as was communicated to Air Namibia, was insufficient, as only a court-appointed official could represent a company in liquidation both in Europe and in Namibia, and for these purposes, only Anicet Baum is recognised for the purposes of dealing with Air Namibia,” Nakawa said.

This follows a judgment on 12 January 2015 brought by the liquidator in the Challenge Air matter, Belgian attorney Anicet Baum, against Air Namibia and TransNamib, which was at the time the holding company of the airline.

The Munich Regional Appeal Court ruled on several payments Air Namibia had to make in respect of monies owed to Challenge Air, totalling - at today's exchange rate - in the region of N$360 million, with an added daily payment of US$1 335 in respect of unpaid maintenance.

The term these monies are outstanding is not known. The court, however, added that the amount in dispute was in the region of 25 million euro, just short of N$400 million.

Air Namibia had 30 days to lodge an appeal, but did not do so.

The attachment of Air Namibia's assets stems from this judgment. The national carrier had signed a lease for a Boeing 767 from Challenge Air in 1998.

Air Namibia bleeds another N$2m

Challenge Air SA was able to extract an additional N$2.1 million from Air Namibia's European bank account last week.

Initially it was able to extract over N$10 million, according to documents seen by Namibian Sun.

“They [Challenge Air] are going to take money again until Air Namibia comes on board. The accounts are frozen until the €25 million is recovered,” said Shali.

“There will be no German accounts until the judgment is fulfilled,” he added.

According to Shali, Air Namibia was given ample time to approach Challenge Air and seek an amicable solution.

“We waited for them for three weeks and they did not respond. We can still open the accounts, but only if they approach us; they must come to the table.”

Shali said that he had to intervene to ensure that the planes would not be grounded.

Baum told Namibian Sun it was superfluous for the respondents, Air Namibia and TransNamib, to accept that they should engage in settlement proposals, but then choose whom they wish to negotiate with.

“The judgment by the Munich Appeals Court still stands, notwithstanding the proceedings in the High Court of Namibia.

“If Air Namibia and TransNamib wish to circumvent the Munich Appeals Court judgment then surely they are not acting in the best interests of their shareholder,” Baum said.

The actions of Air Namibia, he said, were irresponsible.

“It is totally irresponsible to purport to circumvent a valid court judgment which they have failed to either appeal or lodge a review application with the Federal Court of Justice in Karlsruhe, Germany for.”

The fact that Challenge Air SA was able to get money from Air Namibia's German bank account was proof that the ruling was bearing fruit, Baum added.

“It is a fact that the Munich judgment is currently being enforced against the respondents. I honestly don't think they appreciate the weight of the Munich Appeals Court judgment. It's very, very unfortunate.”

Air Namibia adamant

Air Namibia is digging in its heels, however.

“Any purported appointment of a representative in Namibia can only be valid if so recognised in terms of Namibian law. The difficulty faced by the liquidator in being recognised in Namibia befalls the local representatives apparently appointed for this purpose,” Nakawa told Namibian Sun.

According to him, Challenge Air SA, through Shali, has approached the High Court of Namibia.

Shali sought to be recognised in his capacity as liquidator for the purposes of bringing enforcement proceedings against Air Namibia in Namibia. Air Namibia has opposed this application on a number of grounds.

“The matter was heard on 3 December 2018 by the High Court of Namibia and judgment has been reserved for 18 July 2019,” Nakawa said.

He said if Air Namibia were to recognise Shali, it would nullify legal points it has raised.

Nakawa said the airline was aware that it was losing money stemming from its Frankfurt flights.

“Air Namibia is aware of the fact that the airline is losing money as a result of the ongoing process. Engagements, both locally with the shareholder and internationally, have been ongoing with a view to mitigating the effect of this most unfortunate situation,” he said.

Air Namibia has been instructed by the government to seek an amicable solution with Challenge Air SA, so that the national carrier's assets are not attached.


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