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SriLankan Airlines directors faulted for Airbus deal, termination payments by COPE

ECONOMYNEXT – A parliamentary committee overseeing Sri Lanka’s state enterprises has faulted the board of directors of SriLankan Airlines for entering into a 2.8 billion US dollar Airbus deal and paying 115 million dollars to terminate a part of it without legal advice from the Attorney General.

Sunil Handunnetti , Chairman of the Committee on Public Enterprises (COPE) had said that controversial Airbus deal had been entered without proper consultations with the Attorney General, the parliament’s media office said.

The Board of Directors that purchased the airline, the Board that terminated the deal and the current boards are different.

Handunetti had said that changes in the Board of Directors from time to time should not absolve them of the responsibility, the statement said.

He had called for the Auditor General to report the matter to the Attorney General.

SriLankan Airlines had entered into a 2.8 billion US dollar re-fleeting deal while getting 375 million dollars from tax payer of which 355.5 million dollars had been paid to settle fuel bills from the state-run Ceylon Petroleum Corporation.

SriLankan had struck the deal to buy the Airbuses while having only 19.5 million dollars in cash reserves, COPE had said.

After a new administration appointed a different board, 115.77 million US dollars had been paid to terminate the leases of part of the deal.

The COPE had questioned termination clauses in the deal and why such a sum had been paid.

Handunetti had said the deals had been entered and terminated without proper consultations with the Attorney General.

A UK investigation had found that 16 million US dollars had been offered to an agency set up by the wife of an executive of SriLankan Airlines.

Sri Lanka has since arrested the then Chief Executive of SriLankan Airlines Kapila Chandrasena and his wife over money laundering charges related to the Airbus deal. (Colombo/Feb19/2020)

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