Armavia and Zvartnots settle dispute over ground service prices

YEREVAN, March 15. /ARKA/. Armenia’s national airline Armavia and Armenia International Airports company operating Zvartnots international airport have settled their dispute over the prices of the airport’s ground services and signed an agreement which will help the carrier to boost its operations, Armenia-International Airports CEO, Marcelo Wende, said today.

"We have considered all suggestions and requests of Armavia and signed a new agreement," he said at a press conference.

Wende’s deputy Andranik Shkhyan said dispute centered on Armavia's $5.3 million debt to the airport incurred for ground services which the private carrier considered extremely expensive. 

"We have complied with all demands of the airline and expect it to observe debt repayment schedule,» he said.

Shkhyan said the deadline for repayment is September, but the first payments will be made by the end of this week. He stressed that in case of non-payment, the agreement will be invalidated. He said Armavia’s ground services make up 15% of its total expenditures, which is typical of virtually all airlines.

Armen Ter-Tachatyan, a legal advisor for the airport, said it has developed a new tariff system based on the airline's new business plan.

"The established rates are favorable for Armavia, meeting its demands and the approaches which Armavia"presented during the discussions,» he explained.

On March 6 Armavia announced an open-ended strike after failed negotiations with Zvartnots international airport over the prices of ground services. However, the company resumed its flights the same day until March 13 saying it expected the airport to reduce prices by that date.  Armavia was also locked in a similar dispute with Russia’s Rosnavigatsia air navigation agency, which refused to authorize Armavia flights to Russia on March 6 citing Armavia’s failure to pay for navigation services provided to it from December through February. But on the same day the ban was lifted after Rosnavigatsia received written debt repayment assurances from Armavia. 

Rosnavigatsia said Armavia pledged to repay part of the December debt totaling $178,000 by March 20. 

Armavia was founded in 1996. In 2005 all its shares were acquired by businessman Mikhail Baghdasarov. The company operates more than 100 flights a week to over 40 destinations in 20 countries. It owns and runs Airbus, CRJ, Boeing, as well as Sukhoi Superjet aircrafts.

Armenia - International Airports operates Zvartnots airport in accordance with the 30-year concession agreement, signed with the Armenian government in 2001. The company is owned by Argentinean American International Airports, which belongs to the Argentine Armenian businessman Eduardo Eurnekian. -0-