Philippine Airlines to Pay $117m to Settle Manila Airport Fees Dispute


OCTOBER 07, 2017

Manila. Philippine Airlines agreed on Friday (06/10) to pay all navigational fees and other charges it owes the government amounting to $117 million, following President Rodrigo Duterte's threat to cut off its access to a Manila airport terminal.

In a joint statement with the Department of Transportation (DOTr), the airline said it would pay in full the government's claims totaling 6 billion pesos ($117 million) and committed to "keep all transactions updated and current" with airport regulators.

The agreement came days after the government said it had sent a final demand letter to PAL, owned by local tycoon Lucio Tan, before filing for legal action.

"One of the overriding reasons why PAL agreed to settle is to manifest its trust and confidence in President Duterte's administration," the joint statement said.

The figure was lower than the 7.3 billion pesos that the DOTr had earlier claimed it was owed, which it said had accumulated over several years, according to media reports.

Duterte, in a speech last week, gave PAL 10 days to make full payment or lose access to the airport terminal.

PAL exclusively uses the airport's Terminal 2.

PAL and DOTr said the settlement was a result of several months of validation and reconciliation of accounts.