AirAsia Files Court Action Against Malaysia Airports

AirAsia and AirAsia X have filed a fresh legal challenge against the operator of Kuala Lumpur International Airport at the Kuala Lumpur High Court. AirAsia claims that Malaysia Airports (MASSB) owes it $114.5 million for losses caused as a result of negligence relating to the maintenance of Kuala Lumpur International Airport.

An AirAsia X Airbus A330
AirAsia and AirAsia X have been engaged in legal disputes with the operator of Kuala Lumpur International Airport for many years. Photo: Chung ChengYen via Flickr

The ongoing dispute between AirAsia/AirAsia X and MASSB/its parent company, Malaysia Airports Holdings Bhd. (MAHB), continued with the filing of another writ of summons last week, according to reports by CH-Aviation.

The background

The two companies have been locked in a series of protracted, back-and-forth legal battles for many years now. The disputes mostly relate to outstanding charges and fees.

Back in April 2018, MAHB filed a lawsuit that claimed AirAsia had racked up $8.4 million in unpaid airport charges. Then, in December 2018, MAHB sent another request to AirAsia for outstanding passenger service charges from 1 July 2018.

According to MAHB, AirAsia was not collecting the full passenger service charge from international passengers at Kuala Lumpur International Airport Two (KLIA2).

AirAsia claimed that this was because, as an economy terminal, the passenger service charge at KLIA2 should be less than at the airport’s main terminal. The charges at the airport had also risen steeply within the past couple of years

Kuala Lumpur International Airport
AirAsia claims it receives unfair treatment by Kuala Lumpur International Airport. Photo: Rushdi Mohamad via Flickr

AirAsia lost this case and was ordered to pay the outstanding fees owed to the airport. But the carrier launched another legal counterclaim, this time for losses caused as a result of poor service they received at Kuala Lumpur International Airport Terminal Two.

Eventually, just last month, MAHB received payment of the $10 million in outstanding passenger service charges from AirAsia and AirAsia X. But AirAsia’s most recent writ of summons shows that the carrier isn’t done fighting yet.

AirAsia’s new court claim

The new claim filed by AirAsia amounts to more than 10 times the fine it paid in September. AirAsia claims MASSB owes it $114.5 million. Specifically, the airline claims this figure is a result of:

“loss and damage caused by negligence on the part of MASSB, its servants and/or agents in the management, operation, maintenance and/or provision of airport services and facilities at [low-cost terminal] klia2”.

AirAsia requested that the Malaysian Aviation Commission (MAVCOM) step in to mediate the ongoing dispute between the two parties. However, MAVCOM refused to involve itself, a decision that was backed by the Malaysian courts.

An AirAsia X Airbus A330
AirAsia was recently ordered to pay $10 million in outstanding fees. Photo: Bidgee via Flickr

In a statement about the airlines’ decision to launch the most recent claim against MASSB, AirAsia and AirAsia X Chief Executives, Riad Asmat and Benyamin Ismail, said:

“We did not want to do this but Malaysia Airports and Mavcom have forced our hand. Despite our best efforts to settle this matter amicably and through the right channels, we feel compelled to file this claim as we were left with no other recourse to protect our interests”.

Considering the size of AirAsia’s most recent claim and the trend of the Malaysian courts siding with MASSB, it seems unlikely AirAsia will be successful, from an outside perspective at least.