P52.1-M fine on CebuPac to go to national treasury

MANILA, Philippines - The Civil Aeronautics Board (CAB) yesterday said the P52.1-million fine imposed on Cebu Air Inc. (Cebu Pacific) would not be used to compensate passengers affected by flight delays and cancellations during the Christmas holidays.

CAB executive director Carmelo Arcilla said the fine against the Gokongwei-led budget airline would go to the national treasury, as mandated by Republic Act 776 or the Civil Aeronautics Act of the Philippines.

 “Under the law, such a penalty upon collection will go to the national treasury,” Arcilla said.

He pointed out that the fine imposed by the CAB on Cebu Pacific is in the nature of a penalty for non-compliance with conditions of its permit. 

The imposition of such penalty, he explained, is an exercise of the coercive power of the CAB to compel Cebu Pacific to comply with its obligations under its permit. 

The CAB official clarified that the regulator has no authority to determine compensation for passengers affected by flight delays and cancellations from Dec. 24 to 26.

According to Arcilla, the recourse of the passengers would be to seek satisfaction of their rights from the airline.

“If the airlines fail to satisfy the claims of the passengers in accordance with the rules, passengers may seek the assistance of the CAB in the enforcement of the rules and/or go to court to obtain redress,” he added.

As a regulatory agency, the CAB is tasked to promote and support an adequate, reliable and efficient air transportation system that is conducive to the convenience of the public, Arcilla said.

“In pursuit of this task, the CAB issues orders and regulations to assure compliance by airlines with their obligations under their permits to provide proper and suitable public service,” he said.

For one, he explained that the agency implements the Air Passenger Bill of Rights (APBR), which defines and seeks to protect the rights and interests of passengers vis-à-vis the airlines and address common passenger concerns. 

He said the policy covers the various situations where passengers may be prejudiced – these include flight delays, cancellations, terminal delays, overbooking of passengers and other areas of concern – and defines the specific rights of passengers under such situations. 

Immediately after the fiasco at the Ninoy Aquino International Airport terminal 3 (NAIA-3) during the holidays, Arcilla said the CAB issued an advisory admonishing Cebu Pacific to faithfully adhere to the requirements of the APBR and to go out of its way to ensure the protection of its passengers.

“On the matter of the extent of CAB’s authority, the CAB is an administrative agency invested with authority under its charter to oversee the aviation industry, through the issuance of pertinent orders and regulations,” he said.

The regulator, through CAB Resolution No. 4, slapped a P52.1-million fine on Cebu Pacific after it received thousands of complaints of flight delays and cancellations during the Christmas holidays.

 A total of 10,400 passengers were affected. The CAB Board decided to impose a P5,000 fine for every affected passenger.

Data submitted by Cebu Pacific to the investigating panel showed that a total of 288 flights were delayed while 20 flights were cancelled between Dec. 24 and Dec. 26.