The Tourism Ministry has sent the draft Integrated Civil Aviation Bill to the Law Ministry for its inputs, nearly a year after it was written by a government committee.

The proposed piece of legislation envisages splitting the Civil Aviation Authority of Nepal (Caan) into two entities, regulator and service provider.

Alok Chandra Shrestha, chief of the Tourism Ministry’s legal division, said that the draft was forwarded to the Law Ministry last week for its approval. 

“This is the first stage in the process,” he said, adding that after receiving comments from the Law Ministry, it would be tabled in the Cabinet for its approval. 

According to Shrestha, once the Cabinet gives the go-ahead, the Tourism Ministry will prepare the final draft which will be sent to the Law Ministry and the Cabinet again. Discussions will be held on each clause in the bill at various parliamentary committees, and amendments may be made at this stage. 

“Once it is finalized, it will be tabled in Parliament,” said Shrestha. “It’s difficult to say how much time it will take. It depends on the situation.” After the bill is signed into law, it will supersede two existing laws: Civil Aviation Act 1959 and Nepal Civil Aviation Authority Act 1996.

One of the key components of the bill is breaking up Caan. Currently, Caan has been functioning both as a regulator and a service provider from the same office, and there is no clear demarcation between its duties and organizational structure. 

As per the draft bill, Caan will continue to act as regulator while a separate Airport and Air Navigation Services will be set up to operate as service provider. The service provider will be a public limited company and be led by a CEO. Its key responsibilities will include airport management, terminal management, ground handling, airport security, rescue and fire fighting, airport infrastructure development, airport fee and tax collection and air traffic control. 

Likewise, the regulator will be responsible for licencing and regulating aviation professionals and pilots, engineers, air traffic controllers, airlines and aerodromes. The government has been working on the new law for the last eight years. 

The International Civil Aviation Organization’s (Icao) Universal Safety Oversight Audit Programme has recommended that Caan be split to make the aviation sector more efficient.

The new law will integrate the previous acts to eliminate conflicts and contradictions between Caan and the Ministry of Culture, Tourism and Civil Aviation, a situation that has been criticised in safety audits conducted by global aviation bodies.

The proposed law has envisaged allowing the private sector to build and operate airports. A draft of the new law looks kindly at potential privately operated airports, and it has also simplified the process for the government to privatize its existing airports.

According to the draft, the government has laid down five criteria for the construction of private airports.

The proposed airport must be feasible in terms of geographical, environmental and commercial factors. It should be viable in terms of the population size that will use the facility, local and foreign direct investment and social obligation. The government, however, will determine the airport’s limits.

Breaking up Caan, which is among the components of the $4.2 million Air Transport Enhancement Project funded by the Asian Development Bank (ADB), is aimed at facilitating stringent enforcement of safety measures.