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RIZON JET'S CHALLENGES TO SUSTAIN A VIABLE BUSINESS IN QATAR

Posted 22 January 2013 · Add Comment

The row between Qatar's luxury flight services company Rizon Jetand the Qatar Civil Aviation Authority over the rights to operate freely have escalated. Details of the dispute between Rizon Jet and the Qatari state organisation were first unveiled by Arabian Aerospace during the MEBA show in Dubai in December.

 

Today RizonJet met Qatar media in Doha to outline the details of the dispute and to appeal for the opportunity to operate a viable business in the country.

They issued the following statement: 

Rizon Jet is a Qatari-owned company which embodies the Qatar 2030 vision to encourage the private sector to be part of the growth of the country, but its progress to grow and excel is hampered by the Qatar Civil Aviation Authority by creating obstacles along the way.

Rizon Jet is part of Ghanim Bin Saad Al Saad and has operating bases strategically located in the Middle East (United Arab Emirates, Qatar) and Europe (United Kingdom). The company focuses on providing a comprehensive suite of private aviation services: Aircraft Charter, Aircraft Maintenance, FBO / VIP Terminals, Aircraft Management and Aircraft Sale, Acquisition & Consulting.

Rizon Jet’s CEO, Captain Hassan Al-Mousawi pointed out that its investors have spent a lot of money to build a state of the art VIP terminal and maintenance facility. The team is working very diligently and everybody that has visited the facility has been amazed by the facility and services offered. Qatar is known to pioneer and Rizon Jet aims to be a pioneer in offering exceptional aviation services, but is facing hindrances that make it impossible to sustain a viable business in Qatar.

 

THE HISTORY

Rizon Jet has been founded in Sharjah, UAE in 2006. After the Qatari council of minister’s decision to allow private sector investment in establishing Air Taxi, Air Ambulance, and Large Cargo Aircraft, Rizon Jet was amongst 15 investors that applied for an operating license in Qatar. Of the 15 applicants 7 were initially qualified and were invited to complete the process of obtaining the Air Operator Permit. Only 2 companies (Rizon Jet and another company ) completed the final requirements and were awarded an AOP. Today Rizon Jet is the only company with a valid AOP. In February 2009, His Excellency the Prime Minister approved the allocation of an area for Rizon Jet at Doha International Airport for the purpose of building a private VIP terminal for passengers arriving and departing on private jets, the construction of a hangar for aircraft maintenance and aircraft parking. This approval was granted on the basis that the company should bear all costs of construction and that the facilities of the VIP terminal, parking and hangar should be commercially available to other private jet companies.

In May 2009 Rizon Jet was awarded its Air Operating Permit, and the construction of the VIP facility at Doha International Airport was completed in July 2011. Rizon Jet’s official inauguration under the patronage of the Chairman of the Qatar Civil Aviation Authority was held in March 2012.

During 2012 Rizon Jet aircraft operated 1,039 flights, to 91 airports across 4 continents. Out of the 1,472 private and corporate flights out of Doha International Airport, 291 were Rizon Jet flights, and 447 from 3rd party aircraft using the Rizon Jet terminal.

 

THE CHALLENGES

1)            Ground Handling:

Seven days after the inauguration in March 2012 Rizon Jet received a letter with allegations of providing ground handling services, contrary to its approval conditions, and demanded that Rizon Jet must cease forthwith from offering such services.

Rizon Jet refuted the claim of unauthorized handling services, providing copies of Qatar Airways ground handling invoices as evidence that all ground handling services were provided by Qatar Aviation Services owned by Qatar airways. When Rizon Jet’s CEO visited the Chairman of Qatar Civil Aviation Authority, he advised that an investigative committee would be formed under his direction. Five members were appointed; three of them were Qatar Airways employees, this was a clearly biased committee right from the start. The committee demanded provision of a breakdown of the ground handling equipment available to Rizon Jet, as well as well as the provision of aircraft maintenance approvals, which are issued by the Aviation Authority itself. Rizon Jet complied with the request and noted that all of the equipment fell within the remits stipulated under its approvals to undertake maintenance work on aircraft in accordance with the laws and regulations of the Qatar Civil Aviation Authority. Without such equipment Rizon Jet’s application to undertake maintenance would not have been approved in the first place. The equipment is dual use for ground handling and aircraft maintenance. Rizon Jet further stated that the fact that Rizon Jet had these equipment should not be considered as evidence that it was engaged in Ground Handling activities.

Based on the committee’s findings the Chairman of Qatar Civil Aviation Authority issued a final warning to Rizon Jet for:

-            introducing equipment without approval from the authority and that such equipment had not been used solely for aircraft maintenance

-            receiving private jets belonging to corporate and other individuals and providing ground handling services to those aircraft through Qatar Aviation Services.

AC-U-KWIK, a flight planning resource guide for worldwide Airport and FBO / Handler data, proves the existence of other companies (besides Qatar Aviation Services) that offer ground handling services for corporate aircraft at Doha International Airport. Four of the listed companies are based outside Qatar they even provide telephone numbers outside of Qatar.

In November 2012 the Civil Aviation Authority advised Rizon Jet it will reject all applications to use the Rizon Jet VIP terminal from private and corporate operators coming into Doha.  This explicitly violates the initial approval of His Excellency the Prime Minister, granted in February 2009. The only exception to this was when QCAA granted an approval for Rizon Jet to receive the Paris St Germain football team in December 2012.

 

2)            Travel Agency License

To extend its range of services, Rizon Jet applied for a travel agency license.  All regulatory requirements were adhered to, the bank guarantee deposited and the office location as ‘Rizon Jet at Doha International Airport’ specified. On May 22nd, 2012 QCAA issued Rizon jet the requested travel Agency License, the license clearly stated that the location of the travel agency was at Rizon Jet premises at Doha international Airport. About 6 months later, with neither a warning nor a legal justification the Chairman of the Civil Aviation Authority issued a letter informing Rizon Jet that the license had been withdrawn as the Rizon Jet office lies within the airport perimeter and such activity is exclusively for Qatar Aviation Services. Rizon Jet naturally contested this but hasn’t received any reply yet.

 

3)            Flight Support Services

On October 9th, 2012 Rizon Jet requested the addition of flight support services to its commercial license in Qatar. Third party fight support services are not restricted to any particular airport, they can be provided between any two airports globally. On October 21st, we received a notification from the Qatar Civil Aviation Authority refusing our request, reminding us that they will not tolerate any activity beyond the company’s operating permit.

Hereupon, on October 23rd, Rizon Jet applied to offer flight support services at through its offices at Sharjah Airport International Free Zone (SAIF Zone) in UAE and got the preliminary approval from the Sharjah Free Zone Authority the same day. The provisional approval from Sharjah was issued on October 24th and Rizon Jet received its license in Sharjah on November 5th, 2012.

 

4)            Al Khor Fly-In Event

Rizon Jet had received an invitation from the Al-Khor Fly-in organizing committee to participate in the Al Khor Fly-In Event in January 2013. As part of its community service, Rizon Jet intended to participate with two aircraft on display. One day before the event, Rizon Jet’s CEO received a call from the Director of Air Navigation at QCAA, advising that Rizon Jet aircraft have been banned from attending the event.

 

FINAL STATEMENT OF RIZON JET’S CEO, CAPTAIN HASSAN AL-MOUSAWI

 “We have tried to resolve the issues on an amicable basis but now we have to speak up. If it is a level playing field then competition is ok, but this is uneven. It is unfair competition. We are all for clean, healthy competition – that is what brings efficiency and raises standards, but in Qatar we have a world-class airline that also owns a private jet business, enjoys a monopoly on ground handling, as well as being the airport operator. We were aware of the exclusive deal the airport has with Qatar Aviation Services for ground handling and we are happy with them providing the under-the-wing services, catering, towing etc., but at the same time, we were told that we could accept our own aircraft and those of third parties. We are not going to accept the block, which has resulted in all third-party customers being forced to use the main ramp at Doha International Airport. 50% of our FBO revenue was coming from 3rd party customers and it was on the increase, so it’s a big chunk for us. It might not be a big deal for a big multi-billion dollar company like our competitor’s parent company, but for us it makes a huge difference. We are a Qatari-owned company and we would like to be given the opportunity to operate and build a viable business in Qatar.”

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