To Let Paper

Philippine Daily Inquirer Business
Tuesday, September 8, 1998
BUSINESS
Breaktime
By Conrado R. Banal III

AS kids, once upon a time, we made and played with paper airplanes. Now a paper "airline" is something else. None of us would have thought that, within our lifetime, they could already make an entire airline out of paper.

Our own national flag-carrier, you see, the weak and wobbling Philippine Airlines, troubled by swelling debts and shrinking market, which forced it to send away about 5,000 people jobless, is up against such an ultra modern invention.

It was made in the Philippines, using Japanese money. No modern technology, nevertheless, was needed to create it. Of course I am talking about the CLA Air Transport—the first and only for-hire (American) or to-let (British) paper airline in the world.

All that its incorporators needed were big connections in the government here and there, plus a sprinkling of lies there and here, and, presto!, they have a paper airline. What's great is, the airline even has an instant multimillion-dollar business.

FOR 10 long years, as a background, the hard-up PAL was working on getting more slots at the Narita Airport in Japan. The break came in April last year, when Manila and Tokyo signed a new air agreement. This allowed cargo flights between the two countries.

But there were no new slots at Japan's premier Narita Airport for the flights from the Philippines. In effect, Tokyo said, okay, you can fly to us, but bring your own parking. Months passed, then more than a year passed, and the break finally came last July. The Japanese government assigned six slots for the Philippines.

Lo and behold, officials in the administration of the man named Band ...Wrist Band... are insisting that CLA Air Transport should get the new slots at Narita. That's instant business at the expense of PAL.

And do I have news for you! CLA Air Transport has a problem bigger than Godzilla and all her (his?) eggs put together. Its license to fly here, known in the business as TOP, or the "temporary operating permit," will expire tomorrow.

NO wonder, some people in the government are rushing a renewal. About two weeks ago, the Civil Aeronautics Board, or CAB, which granted the permit to CLA Air Transport, held a meeting presided by Transportation and Communications Secretary Vicente Rivera himself.

Tsk, tsk, the airline's case of an expiring TOP was not in the agenda. So Rivera inserted it at the last minute as an addendum. How many reasons were there for such...well, an accommodation? Frankly, I am hard pressed for one.

Airplanes are crashing here and abroad. Thus an airline's flying permit is hardly a small item. You cannot just regard it like a tag question or an afterthought—an addendum. It seems CLA Air Transport was that desperate.

The company only had a six-month TOP, issued last March, which means it was done still during the term of Fidel Valdez Ramos. Those new slots at Narita Airport will be opened next month. Olreydi? Tell me, how can CLA Air Transport use them, if it does not even have a flying permit?

So there, it got a TOP from the Ramos administration quite quick, and now a renewal from Wrist Band's people much quicker through a mere addendum. Does Wrist Band know all about this? Does he know somebody at the Palace is doing all the manipulation?

WHAT'S more mystifying than all the rush of Wrist Band's people to come to the aid of CLA Air Transport is the status of the company itself. This company was formed one and a half years ago—or just about the time Manila and Tokyo signed the new air pact.

You know what? Early this year, the company even got a designation as a Philippine national flag carrier. Somebody in CAB claimed to the Palace that the board already approved it. This was a big lie. The CAB never took up such a thing at the time of the claim.

And so the company could carry the Philippine flag. Nice! Only, it's a Japanese company technically. Official documents show that more than 80 percent of its paid-in capital came from IASS Co. Ltd.—yes, a Japanese firm. You mean, Japan and the Philippines already merged, and a Japanese company is also Filipino?

Yet the Wrist Band administration even defends the company's foreign ownership. They say it is indeed a foreign carrier, but it's in the mold of Fedex and such. They can operate here—legally. Really?

OKAY, sure, but please tell us, the poor ignorant public, why does a Japanese company have to carry the Philippine flag? It's simple, my dear pimple, and it's because the CLA Air Transport needs those slots at the Narita airport for its instant business.

They can only be used by the country's flag carrier. This makes only PAL eligible. As a matter of fact, only PAL applied for the slots with the CAB. The board had no choice but to endorse PAL's application to Tokyo.

But somebody big at the DOTC just had to reverse the endorsement. The slots should actually go to CLA Air Transport, she said. She did not say that the company's permit was soon to expire. And that's why they have to hurry up a renewal.

And what kind of company are Wrist Band's people supporting? Let's look at its brilliant track record of zero flight so far. CLA Air Transport itself admitted that it does not own a single airplane. It does not have a single pilot. It has not flown anything at all. It is only an airline on paper—used toilet paper, at that!