Money

Firms involved in supplying two A330s given one-week summon extension

- SANGAM PRASAIN, Kathmandu

Apr 19, 2019-

The Commission for Investigation of Abuse of Authority has given five international firms involved in supplying two wide-body Airbus A330 jets to Nepal one more week to appear before the anti-graft agency.  They had failed to appear before the Commission for Investigation of Abuse of Authority even after a fifteen-day summons notice was issued on March 27. The jet purchase deal ran into controversy following which a corruption case was filed at the anti-graft agency.

On March 27, the apex constitutional body for corruption control issued a public notice asking the firms—Hi Fly X Ireland Limited, Dublin; AAR International Inc, USA; German Aviation Capital GMBM, Frankfurt; Hi Fly-Transporte Aereos [Hi Fly Airlines], Lisbon, Portugal and Norton Rose Fulbright, Munich, Germany—to appear at the authority office in Tangal within 15 days.

An official source said that the investigation team has summoned the officials for recording their statement in connection with $209.6-million Airbus deal, the largest ever in Nepal’s aviation history.

“We have extended the second summons notice as per the investigation process,” said Pradip Kumar Koirala, spokesperson of the Commission for Investigation of Abuse of Authority. “Failure to comply with this notice shall result in legal action as per prevailing laws.”

In January, the parliamentary Public Accounts Committee had concluded that the procurement of the two wide-body aircraft by Nepal Airlines had caused a loss of Rs4.35 billion to the government. The parliamentary committee had questioned the motive of Nepal Airlines Corporation and Hi Fly Portugal for forming a special purpose vehicle—Hi Fly X Ireland—to specifically look into the procurement process.

The committee has termed Hi Fly X a “fictitious” company and has suspected “massive financial irregularities” in the deal. Stating that Ireland is the biggest tax haven in the world used by multinationals to shelter profits, the lawmakers suspected Nepal Airlines Corporation might have reached the deal with the company “to evade tax”.

While advance payment was released to the Portugal-based HiFly Transporte Aeroes, rest of the payment was released to the Ireland based-company, the committee report had said.

The national flag carrier had initially signed a $209.6-million contract for two jets with the consortium of the United States-based AAR Corp and German Aviation Capital in April 2017. The corporation had deposited $79 million into the escrow account held by Norton Rose Fulbright as an advance payment for the two jets.

Pointing out irregularities worth Rs4.35 billion in the aircraft purchase deal, the parliamentary committee had implicated then sitting tourism minister, Rabindra Adhikari, Nepal Airlines Corporation Managing Director Sugat Ratna Kansakar and some other government officials. Adhikari died in a helicopter crash on February 27.

The government also had formed its own panel in January to probe into the irregularities in the jet purchase deal, but its term ended before it could initiate any work.

Published: 19-04-2019 08:38

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