The state-owned Iraqi Airways is offering one of its old Boeing jetliners for sale as scrap as it continues to sell off the remnants of a decades-old fleet that was moved to neighbouring countries after Iraq’s 1990 invasion of Kuwait.

The 737-200, parked for years at Queen Alia International Airport in Amman, Jordan, had been used by Saddam Hussein’s government to transport VIPs.

“This is one of the old aircraft which cannot be returned to service,” said Nasir al-Amiri, an adviser to Iraq’s transportation minister. “There were six aircraft (in Jordan). We sold five and this is the last one.”

“This is not a part of fleet modernization. It’s an old airplane and to get it back [in working order] would cost huge amounts of money,” Amiri said.

Thirteen Boeing 707, 727 and 737 aircraft were sent by Hussein’s government to Jordan, Tunisia and Iran to keep them safe from alliance airstrikes after the start of the war to liberate Kuwait, officials said.

Economic sanctions, political disputes and other factors prevented Iraq from maintaining or retrieving the aircraft. In some cases they were held due to compensation issues related to the Kuwait invasion and the Iran-Iraq war.

Baghdad and Kuwait have been locked in a long-running dispute over billions of dollars in reparations, including some $1.2 billion related to aircraft and parts seized during Saddam’s invasion.

Iraq’s government said last year it would dissolve Iraqi Airways within three years to avoid asset claims by Kuwait, whose national airline has pursued court judgements against Iraqi Airways.

Last month Kuwait seized the Iraqi Airways office in Amman after obtaining a court ruling there.

“There is no relation between the sale of these planes and the problem with Kuwait Airways. Our technical teams confirmed that it is not economic feasible to maintain the aircraft or return them to Iraq,” said Salman al-Behadli, a deputy of the transportation minister.

Amiri said Iraq had sold the Boeing jets in Tunis and five of those in Jordan but five remain in Tehran. Behadli said Iraq is negotiating with Tehran over the planes but had not yet reached a political agreement that would allow them to be sold.

(Source: Reuters)

Bloomberg reports that Iraqi Airways will appeal a court order to freeze its bank accounts in Jordan following a lawsuit by Kuwait Airways.

Karim al-Nuri, a spokesman for the Iraqi Minister of Transport, told the news agency:

“We are preparing to appeal the Jordanian court order. Our appeal is based on the fact that Iraqi Airways is a state company and thus enjoys immunity and cannot have its offices seized.”

The Iraqi national carrier’s offices in Amman were seized three day ago and assets of $1.5 million frozen after the May 10 order by a Jordanian court.

State-run Kuwait Airways is seeking $1.2 billion in compensation for 10 aircraft taken when Iraq, under the rule of former President Saddam Hussein, invaded Kuwait in August 1990. Kuwait Airways won a British court order to freeze the Baghdad-based airline’s global assets on April 25 last year, the same day as an Iraqi Airways flight landed in London for the first time in 20 years and was impounded.

The Iraqi government decided in May of last year to dissolve Iraqi Airways within three years because of the legal battle with Kuwait. The airline has cancelled flights to Europe since last year but continues to fly to destinations in the Middle East.

Iraqi Airways is planning to pursue negotiations with Kuwaiti officials in order to find a solution to the conflict that would benefit both parties, al-Nuri said.

The Iraqi carrier is also still considering government plans to operate under a new company to avoid the legal dispute and compensation claims raised by Kuwait, he said. “We are considering some contracts with local and foreign companies, although there is nothing final for now,” he said.

Kuwait Airways “seized multi-million dollar funds in various Iraqi Airways bank accounts in Amman,” following the May 10 Jordanian court order, Kuwait Airways lawyer Christopher Gooding of law firm Fasken Martineau said.

Iraq State Minister and Government Spokesman, Ali Al Dabbagh, told Alsumarianews that he cannot allow Kuwaiti Airlines to act in a way that does not show any spirit of cooperation: “It seems that Kuwaiti Airlines want to complicate the crisis. However, Iraq will preserve its right fully.”

The Iraq Cabinet will take the appropriate decision in this regard, he added.

(Sources: Bloomberg, AlsumariaTV)

Kuwait Airways will seek compensation from Iraq for having allegedly stolen its aviation equipment and 10 aircrafts worth $1.2 billion during the first Gulf war, according to a report from Al-Arabiya.

A lawyer from the Airline is quoted as telling Iraq Oil Report that the company will seek to enforce a 2006 English Supreme Court ruling against Iraqi Airways.

“From the First of July, it’s open season…we can enforce against any assets, including oil tankers and oil assets,” he said.

A United Nations Security Council resolution on January 15 gave a period of six months ending June 30 to lift protection on Iraq money approved by the United Nations in May 2003.

Hajjaj Bukhadour, a Kuwaiti economist, told Al Arabiya that “Iraq has compensated for much of what its previous regime did to other countries,” and that some remaining claims can be settled before the end of international legal protection on Iraq’s assets.

Mr. Bukhadour added that Iraq did not have any oil assets abroad but that it had some funds that were frozen under UN sanctions.

He said that any compensation claim against Iraq had to be settled through the United Nations, insisting: “No country has the right to ‘seize’ any other country’s assets outside international law.”

According to the January 15 UN resolution, “The requirement …that all proceeds from export sales of petroleum, petroleum products and natural gas from Iraq be deposited into the Development Fund for Iraq shall no longer apply” after June 30, 2011.

The resolution also indicated that 5 percent of the profits from all oil and gas exports be deposited into the compensation fund established in accordance with Security Council Resolution 687 (1991).

(Source: Al Arabiya)

According to a report from The National, lawyers for Kuwait Airways have vowed to seize international assets owned by the Iraqi government following a recent court ruling in its long-running dispute with Iraqi Airways.

A UK court ruling has granted Kuwait Airways the right to file proceedings against the Iraqi government and ministries of transport and finance as it seeks to recoup assets to satisfy judgments worth almost US$1.3 billion for the theft of planes and engines during the Iraqi invasion of Kuwait in 1990.

“We will very soon be hunting for state of Iraq assets as well as Iraqi Airways assets,” said Christopher Gooding, a lawyer representing Kuwait Airways, who added the judgment “expands the range of assets available for enforcement”.

Until recently, a UN mandate has covered Iraq’s financial assets to shield its oil and other revenues from billions of dollars in international claims stemming from the era of Saddam Hussein. The report says that from July 1, the country will no longer be immune from financial claims, including those made by Kuwait Airways.

The Kuwaiti airline has also been pursuing the case in Canada, where court judgments cleared the way to seize buildings owned by Iraq as well as an aircraft order for regional jets from Bombardier, which is based in Montreal.

Iraq’s international assets are “substantial”, Mr Gooding said. This includes property and assets related to its oil and gas business, including tankers. “We are actively considering immediate options,” he said.

The long-running case forced the Iraqi government to announce last year it would dissolve Iraqi Airways to side-step its legal obligations, although the Iraqi carrier continues to operate.

Last week, Hoshiar Zibary [Zebari], Iraq’s foreign minister, and ministers of transport and finance went to Kuwait to discuss the airline dispute and other pending issues related to the First Gulf War, hoping to find a resolution, or at least to “lay a road map to settle them”, according to the Kuwait daily Al Watan.

Kuwait Airways, which has made a loss for several years, is in the process of converting into a private-sector shareholding company, depending on how fast the country’s sovereign wealth fund organises an auction to offer 26 per cent of the carrier’s shares to a strategic investor, Al Watan reported. The Kuwait Investment Authority will hold a 24 per cent stake in the new company, while the remaining 50 per cent will be offered for public subscription.
(Source: The National)

Iraq’s Transport Ministry revealed on Thursday that it has signed a contract with a German company to buy 15 civilian aircraft to be delivered by 2013. According to the report from AKnews, this indicates that the ministry plans to contract with international airlines to operate flights to the country, on the condition that about 45% of the profits are allocated to Iraqi Airways.

The press secretary for Iraqi Airways, Akram Lahibi, said Iraq has signed a contract with the German company ‘Bionk’ to import 15 aircraft which would arrive in Iraq by 2013 after the solution has been reached between Iraq and Kuwait on the compensation of the airlines.

According to Lahibi, discussions with the Kuwaiti side have reached an advanced stage and many of legal obstacles confronting Iraqi Airways have been fully resolved, which will contribute to the establishment of air routes between Iraq and the rest of the world.

The Ministry of Transport declared on January 17 the opening of three major air lines.

Iraqi has to pay Kuwait $1.2 billion as compensation for damaging 10 Kuwaiti airplanes during the invasion in 1990. Kuwait is reportedly demanding $1.3 billion, to include accrued interest.

In 2008, the Iraqi government contracted with Boeing to buy 40 new 737 and 787 Dreamliners, with purchase rights for an additional 15 aircraft to be delivered during 2013 — the total value of the contract amounted to $ 5.5 billion. The Iraqi government also signed a contract with the Canadian company Bombardier to buy 10 aircraft CRJ900 medium-sized planes with the right to buy 10 other aircraft in the future.

(Source: AKnews)

An appeal by the Iraqi government against Kuwait Airways‘ (KAC) claim over the theft of its aircraft during the Iraqi invasion of Kuwait has been summarily dismissed by a Canadian court of appeal, Arabian Aerospace has reported.

Last year, KAC seized Iraqi Airways and the State of Iraq interests in an order of new aircraft from Bombardier in Montreal, claiming the contract was a sham and that the real contract is between IAC and Bombardier.

According to Aswat al-iraq, the fight continues in the Quebec courts but even the total value of the contract is nowhere near the full amount of the judgments held by KAC.

(Source: Aswat al-Iraq)

Iraq’s Transportation Ministry said on Tuesday that Iraq has decided to sell all its aircraft parked at airports in Jordan, Tunisia and Iran by the former Ba’athist regime.

“The Transportation Ministry has got the approval of the Council of Ministers to sell all its aircrafts, parked in Jordan, Tunisia and Iran, possessed by the Iraqi Airways and covered by exception from the law on sellilng state property, because they have become scrap and can’t return to service”, Nasser al-Shibly told Aswat al-Iraq news agency.

Shibly said that his Ministry had sold 5 of the planes to Jordan and it is expected to rehabilitate one of them only, and there is the impending sale of two other aircrafts to Tunisia.

Iran had refused to return the planes parked at its airports, as talks with it in this regard had reached to a dead-end.

Iraq had flown the aircraft to other countries to prevent their destruction by the U.S.-led attacks during the Gulf War following Iraq’s occupation of Kuwait in 1990.

(Source: Aswat al-Iraq)

The Supreme Court of Canada has allowed Kuwait to pursue the seizure of Iraqi government assets in Canada, according to CTV News.

The high court has granted an appeal by Kuwait Airways against Iraq and Bombardier Aerospace of Montreal, follows a British judgment that could allow Kuwait to seize Iraqi passenger planes now in Canada.

At issue was Iraq’s ability to claim jurisdictional immunity involving a foreign judgment, and at stake is Bombardier’s ability to complete a $398-million aircraft deal with Iraq.

Kuwait has been trying since 1990 to extract reparations from Iraq over damages arising from the first Gulf War, when Saddam Hussein’s Iraqi army invaded Kuwait and occupied the small oil-producing country.

The Supreme Court ruling means that the case now goes back to the Superior Court in Quebec, which will ultimately decide whether the British judgment can be enforced in Canada.

(Source: CTV News)