The air carriers in Bulgaria are threatening the state with a lawsuit and a referral to the European Commission, as they want the financial aid for the consequences of the pandemic to cover the period of Covid. This is clear from an open letter from the Bulgarian Aviation Industry Association (BAIA) to Prime Minister Kiril Petkov, Finance Minister Asen Vassilev, Transport Minister Nikolay Sabev and the chairman of the transport committee in the National Assembly Borislav Gutsanov.
The absurd and outrageous decision came after the cabinet voted on the measure at its meeting on Wednesday. However, the scheme was approved by the European Commission in March and the funds were earmarked in the 2021 budget.
“The air carriers ask for an adequate and swift response to prevent the absurd, scandalous and lobbyist decision that the financial assistance to air carriers in relation to the effects of the pandemic should be to cover liabilities by 31 December 2019,” the open letter said.
The association states categorically that there is no economic and market logic in this and this aid will not go to its intended purpose, namely to overcome the consequences of the pandemic.
The industry insists that the text of the Decree of the Council of Ministers, which will determine the conditions for the distribution of the grant to the aviation carriers in Bulgaria, should state that the funds are provided to cover the uncovered fixed costs incurred during the period from 1 March 2020 to 31 December 2021. The carriers are also demanding accountability for the inclusion of the pre-pandemic period in the EC Decision and in the Decree of the Council of Ministers.
After many months of efforts by the industry associations, it was only in September 2021 that the 46th National Assembly approved the granting of financial assistance to the air carriers in Bulgaria. Contrary to all logic, however, the text voted in the “Law on the Amendment and Supplementation of the Law on the State Budget for 2021” provides that the funds “shall be provided for the repayment of public debts, obligations to banks and obligations under aircraft operating lease contracts currently due as of 31 December 2019.”
“For absolutely inexplicable reasons, the Bulgarian legislator has determined that the funds earmarked under the ‘Temporary Framework’to address the economic consequences of COVID-19 should be made available to Bulgarian companies to cover their pre-pandemic obligations,” the air carriers explain. In their words, it is crystal clear to all that the liabilities existing at the end of 2019 are not and could not arise as a result of the COVID-19 pandemic occurring in 2020. At the same time, however, the legislator has enacted this text and, despite all previous efforts, it is enshrined in the EC Decision and in the draft Decree of the Council of Ministers prepared by the Ministry of Transport and Communications.
