DAR ES SALAAM, Tanzania (eTN) – Tanzania’s dying national airline, Air Tanzania Company Limited, is facing legal suits in the United States and South Africa after failing to to settle its debt amounting to US$5.9 million to Celtic Air Corporation and South African Airways.
Senior officials from the airline’s head offices in Tanzania’s capital city of Dar es Salaam said the two legal counts were registered in the United States and South Africa after Air Tanzania breached contracts with the said air companies.
Celtic Capital Air Corporation is claiming US$1.7 million, while South African Airways (SAA) is claiming a total of US$4.2 million, basing their claims on contract breaching by Air Tanzania Company Limited (ATCL).
Celtic Capital Air Corporation had leased two Boeing 737-200 planes to ATCL, but the Tanzania’s national airline stopped flying them.
ATCL leased two planes from the corporation, but as time went by it stopped using one of them, senior officials from Celtic Air Corporation said.
The contract for the second aircraft lapsed in March 2010 following the plane crash at Mwanza airport. South African Airways is suing ATCL for failing to pay US$4.2 million.
The Tanzanian government has been funding the loss-making airline to rescue from labor or industrial crisis and debts to its creditors, including local and foreign suppliers.
Since its parting from SAA, the airline has been experiencing a series of problems, while in December 2008, the Tanzania Civil Aviation Authority revoked its operation license over faulty documentation, terming it air-worthless.