Transport Ministry tries to save Vietnam Airlines, experts cite legal constraints

If enterprises are treated unequally, Vietnam will suffer immeasurable consequences, said lzwyer Truong Thanh Duc from Basico Law Firm.

Thoi Bao Kinh Te Sai Gon cited a report from the Commission for the Management of State Capital at Enterprises (CMSC) that found that Vietnam Airlines had reported a loss of VND20 trillion and cash flow deficit of VND15-17 trillion.

Transport Ministry tries to save Vietnam Airlines, experts cite legal constraints



In a document to the Prime Minister, the Ministry of Transport (MOT) said it has assigned the Civil Aviation Authority of Vietnam (CAAV) to figure out a protection policy in terms of slot allocation and domestic air transport growth to help the national airline develop in a sustainable way.

Duc, who is a member of the Vietnam International Arbitrary Center, warned that the action of protecting Vietnam Airlines, if taken, will violate laws and regulations.

If enterprises are treated unequally, Vietnam will suffer immeasurable consequences, said lzwyer Truong Thanh Duc from Basico Law Firm.


Duc said that protection policies support the development of a young but potential economic sector.

 

They also support domestic enterprises that are in unfair competition with foreign enterprises that receive a subsidy from the governments, or when natural calamities and epidemics break out.

However, if the state management agency (MOT) wants new policies to protect one enterprise (Vietnam Airlines), this will violate many laws, including the Competition Law, Civil Aviation Law, Enterprise Law and Investment Law. This will also violate bilateral and multilateral commitments and agreements of which Vietnam is a member.

The laws in general and the four laws cited above clearly stipulate the principle of equal treatment to all enterprises and economic sectors.

Clause 4, Article 5 of the 2014 Investment Law stipulates that the State treats all investors equally.

Article 5 of the 2014 Civil Aviation Law says the principle of civil aviation activities is "fair competition among all organizations and individuals of all economic sectors participating in civil aviation activities".

Article 53 of this law requires the Ministry of Transport to coordinate slots in a way to ensure publicity, transparency and non-discrimination.

Meanwhile, some analysts cited the Prime Minister’s Decision No 236/2018 on a national plan to develop Vietnam’s air transport as saying that Vietnam Airlines will be built into a ‘core air transportation force’, saying that in order to do this, Vietnam Airlines needs policies to encourage its development.

On this issue, Duc said MOT will still be able to build Vietnam Airlines into a core air transportation force, but it has to place Vietnam Airlines into a business environment that has fair competition among air carriers.

CafeF

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