SAA reaches settlement with US over R5.6m fine

SAA reaches a settlement with the US this week. This follows reports from over a R5.6 million fine for the embattled national carrier.

Business Tech also reports that South African Airways (SAA) has published details of its settlement with the United States Department of Transportation (USDOT).

Here’s more …

SAA REACHES A SETTLEMENT WITH THE US

As reported yesterday (Tuesday 4 June 2024), USDOT is targeting multiple airlines and has imposed a total of $2.5 million (roughly R46 million) in civil penalties.

The airlines include Lufthansa, Air France unit KLM Royal Dutch Airways and SAA.

Moreover, these fines are for cancellations/disruptions to COVID-19 flights headed to and from America.

An earlier report stated that more than $900 million in refunds was still owed to passengers from the aforementioned airlines. And affected passengers have been waiting for four years for their money.

Likewise, there were 400 unresolved complaints against South African Airways.

R2.2 BILLION ALREADY PAID

Finally, as SAA reaches a settlement with the United States to pay $300 000, this has increased the total of monies paid out to R2.2 billion since April 2021.

In a release by the airline, it noted the USDOT’s imposed civil claim against the airline on behalf of passengers for delayed refunds on tickets purchased to and from the United States.

“SAA is pleased that it has reached an amicable settlement with the US Department of Transportation (USDOT) on the matter.

From the original penalty claim amount, SAA has accepted the settled imposition of a civil penalty of $300 000 to void protracted litigation.

The penalty will be paid to the US Treasury over 540 days of the issuance date of the consent order,” said the airline.

BANKRUPTCY AND BUSINESS RESCUE

Furthermore, like so many state-owned enterprises (SOEs), SAA’s plight was exacerbated by entering into business rescue in 2019.

Nevertheless, it says, “We took extraordinary steps during 2019-2022 to process refunds for passengers whose flights were cancelled. This was not only in the USA but throughout all of SAA’s markets.”

“We are pleased that this matter has now been finalised. The intention of the parties was always to find an amicable way of closing this case. We look forward to normalising relations with our customers in the US and welcoming them aboard SAA when we resume flights to the Americas in the future,” concluded Koekie Mbeki, Chief Legal Counsel for SAA.