The country's flag carrier in a statement on Wednesday said it will "continue to cooperate" with the government to finally to resolve "complex legal issues," which PAL has been threshing out with the Civil Aviation Authority of the Philippines (CAAP) for years.
The DOTr on Wednesday said PAL must now pay over P7.28 billion. The amount is for the P6.96 billion to be paid to the Civil Aviation Authority of the Philippines (CAAP) as of July 30, and P322 million to the Manila International Airport Authority (MIAA) as of September 26.
PAL said it already submitted an offer to the CAAP through its inter-agency panel of negotiators, but has not received a response yet.
"We look forward to meeting the negotiating panel and we are ready to submit a Compromise Agreement to settle this issue once and for all," PAL added.
PAL said the same legal issues were the subject of a court case between PAL and the MIAA years ago, where the court ruled in favor of PAL.
Despite the favorable ruling, PAL said it opted to amicably settle with the MIAA.
PAL was a government-owned and controlled corporation with tax privileges and exemptions prior to its privatization in 1992.
The DOTr said it sent letters in August 2016 to PAL "demanding full payment of all unpaid charges" at the order of DOTr Secretary Arthur Tugade. Discussions followed which resulted in PAL's payment of P370 million to the CAAP, the DOTr said.
However, the DOTr said it has denied PAL's requests to pay over P6 billion in arrears in seven years.
"Thus, final demand for full payment of all unpaid charges has been sent to PAL, preparatory to the filing of appropriate legal action in order to protect the interest of government," the DOTr said in its Facebook post.
Duterte: I'll have to shut down NAIA terminal if PAL won't pay debts
The issue on PAL's unpaid fees gained steam after President Rodrigo Duterte warned PAL to settle its debts or he will have to shut down the Ninoy Aquino International Airport Terminal 2, which PAL exclusively uses for most of its regional and international flights.
In a speech at the 56th anniversary of the Philippine Constitution Association late Tuesday, Duterte said he turned down the campaign money offered by PAL chair and chief executive officer Lucio Tan because of his debts.
"Sabi ko, you are using government buildings, airport, you have a back…utang diyan sa runway 'di mo binabayaran," Duterte said.
(Translation: "I said, you are using government buildings, airport, you are not paying your debts there for the use of the runway.")
Duterte said he gave Tan 10 days to pay his debts.
"Sabi ko (I said), 'You solve the problem yourself. I will give you 10 days. Bayaran mo. 'Pag hindi mo bayaran, eh 'di sirahan ko.' Wala nang airport (Pay them. If you don't, I will shut it down. No more airport). So what?" Duterte said.
He said he will be left with no choice but to order the closure of NAIA Terminal 2 even at the expense of Filipino passengers.
"Kayo Pilipino (You Filipinos) have to travel overland from Luzon to Davao… I do not mind. If we sink, we sink. But I said, 'We have to enforce the law.' So guys, you guys, if you are put into a great discomfort, sorry. Wala akong magawa (I cannot do anything). The law is the law," Duterte added.
In August last year, Duterte said he turned down campaign money from business magnates like Tan, not because it is "a bad practice," but because it is difficult to be compromised as a leader.
SOURCE: CNN Philippines , presidential tracker live
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