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Wed 22 Apr 2015 11:47 AM

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Qatar Airways shareholders considered dissolving the carrier in 2009, US dossier claims

Financial documents obtained by US carriers claim to show accumulated losses at the Doha airline had exceeded 50% of the share capital

Qatar Airways shareholders considered dissolving the carrier in 2009, US dossier claims
Qatar Airways. (Getty Images)

Qatar Airways shareholders considered dissolving the airline five year ago, amid mounting liabilities, according to a new dossier released by US airlines.

Delta Air Lines, American Airlines, and United Airlines, under the umbrella of Partnership for Open and Fair Skies, have released financial records of Qatar Airways, Emirates and Etihad Airways obtained after a two-year investigation.

Based on this evidence, the US airlines claim their Gulf counterparts have received $42 billion in subsidies and other state benefits since 2004.

The investigators claim they managed to obtain financial statements, charter documents and other records from corporate registries in various countries where the Gulf carriers have local operations.

The worldwide search spanned nearly 30 jurisdictions, including Singapore, Australia, India, Belgium, Ireland, Malta and the United Kingdom, and yielded 44 documents totalling 1,021 pages – all of which are now available online.

The investigation unearthed 19 years of Qatar Airways’ financial statements. In the 2009 financial statement, which was audited by Ernst & Young, it was reported that the airline had accumulated losses that exceeded 50 percent of the share capital. In accordance with the articles of association of the company, an emergency general meeting (EGM) had to be convened to decide whether the situation required a dissolution of the company, decrease its stake or take any other suitable measures, the documents claim.

At the meeting on September 8 2009, the shareholders resolved to continue operations as adequate financial support was made available to meet any liabilities, the documents claim. Qatar Airways did not respond when contacted by Arabian Business for comment.

Both Etihad and Emirates have strongly denied that they have received subsidies, while Qatar Airways’ CEO Akbar Al Baker is due to address the allegations in presentations scheduled for May 13.

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Marc Z 5 years ago

If they did receive the so called Subsidies, SO WHAT? What's the PROBLEM. Any country will try to support its home grown business. Is that wrong?

John Smith 5 years ago

Yes, its wrong when it hurts western companies but its perfect when it helps them win business.

Mika 5 years ago

Due to the open skies treaty with the United States any airline wanting to operate to the mentioned country is subject to its rules and legislation of the treaty which states that no goverment subsidy shall be given to any ''private''airline that is taking a benefit of such treaty. This also includes the European Union. Qatar Airways is free to receive the subsidies they want but as long as they stay away from the Open Skies treaty they simply can't. This is a clear evidence of what we know already since many years ago that most of the ME carriers are subject to subsidies in one way or the other. Sadly, the USA/EU are countries/governments that have a strict legislation and laws that are equal to everyone compared to other countries in the region where pretty much everything is decided by one person.

Steve Spillburg 5 years ago

Even the US government bailed out the big banks, the car companies and others during the financial crisis of 2008 using tax payers' money. The airlines of US are known to give worst services and figure among the list of worst carriers in the world which also has African and Soviet states airlines. US carriers have earned record profit over last couple of years but their services remain as bad as ever. Every government tries to support their companies during times of need. The gulf carriers wanted to grow and their government helped them. Whats the big deal. The US carriers are just butt hurt because they cannot match the services provided by the gulf carriers.

Allan Schoenherr 5 years ago

I've got to agree with Steve here, rather than spending all this time and money on this exercise why not spend it improving the service of US carriers so people actually want to fly with them. Quite frankly the service (in flight and on the ground) from United was some of the worst I've experience, which includes flights on airlines such as Belavia, Cubana etc. Why is it so hard for carriers such as United to treat their customers as something a little higher than cattle? Ground staff at Houston can be a disgrace at time.