Govt rejects claims, as Qantas quits FJ board

By ELLEN STOLZ

The Fijian Government last night said it is disappointed by Australian airline Qantas removing its directors from the Air Pacific board. The Government strongly rejected claims that Air Pacific could be nationalised. And Air Pacific spokesman Shane Hussein said the removal of the Qantas directors is a shareholder matter and does not in any way affect operations by our national airline. Mr Hussein said: “For our customers and our team here, it’s business as usual as Air Pacific, our business partners, and our great team of professionals continue to work together to revitalise, modernise and ensure the future success of our airline.” The Fijian reaction came after Qantas said it has pulled its four representatives from the Air Pacific board to comply with new regulations that favour majority Fijian representation. Qantas said it is immediately removing directors Simon Hickey, Narendra Kumar, Charles Harvey and Brett Johnson. It said this was in response to a recent decree that required two-thirds of the board to be Fijian citizens In response the Fijian Government issued its own statement saying: “The recent Civil Aviation Decree was designed to ensure that Fiji complies with the Chicago Convention and Bilateral Agreements that require national airlines that fly to other countries to be ‘owned and effectively controlled’ by the citizens of that country. “This very point was made by Qantas on 12 March 2012 when they themselves argued to the Australian International Air Services Commission that Virgin Australia was not under the ‘effective control’ of Australian citizens and hence ineligible to transfer capacity on the Indonesian route as Virgin had requested on 23 February 2012. “Fiji’s laws regarding the ownership and control of its national carrier are now the same or similar to those that exist in many other countries, such as the EU, United Kingdom, Canada, Australia, New Zealand, and the United States. “The Fijian Government has no interest or intention to nationalise any company in Fiji. Qantas is welcome to maintain the same rights as a normal minority shareholder, and dividends will be paid as and when declared.” The Government has had the majority 51 per cent shareholding in Air Pacific. But it said Qantas, while holding only 46% shareholding, had veto rights over a series of areas of Air Pacific operations. Qantas denies this. Qantas has been seeking to sell its shares. The Government says the price Qantas wants it to pay is too high and a stipulated arbitration process should be followed. Qantas said yesterday: “The government has made clear its intentions to unilaterally take absolute control of Air Pacific under the new decree. In the circumstances, Qantas believes it is appropriate to remove its four directors.” Qantas also said: “The action is a response to intervention in the management of Air Pacific by the Fiji government, including the issue of a decree designed to reduce Qantas’s role on the board.” Australian news media said Qantas’s code-sharing and reciprocal frequent flyer arrangements with Air Pacific are expected to be unaffected by the board withdrawal. They are covered by a separate commercial agreement, they said.