BANGKOK, 20 May 2020: The Thai Cabinet approved, Tuesday, a reform plan for THAI which will be implemented through the business reorganisation chapter of the Bankruptcy Act under the auspices of the Central Bankruptcy Court of Thailand.
Confirming the airline’s will enter the business reorganisation chapter 3/1 of the Bankruptcy Act, Thai Airways International second vice chairman and acting president, Chakkrit Parapuntakul, said the airline would still be able to operate flights and run its business as usual.
It is currently grounded under the Civil Aviation Authority of Thailand’s international flight ban that will continue until at least 30 June. Earlier news reports said the airline would resume limited commercial flights in July as travel bans worldwide ease.
At a time when the airline should be celebrating its 60th anniversary in style, it faces a financial crisis unprecedented in its long colourful history. Often dubbed the world’s greatest tourism story, Thailand’s success was in part due to the Tourist Authority of Thailand and the national airline both viewed as lynchpins that helped the country soar into the premier league table of global tourism. 2020 brought a fast reversal as the Covid-19 global crisis and three-years of crippling losses at the airline soured the celebration storyline.
In its statement, Monday, the acting president made the assurance that the airline would not “be dissolved or go into liquidation or be declared bankrupt.”
“On the contrary, the business reorganisation chapter will enable THAI to reach its reform plan’s objectives even more effectively step by step as required by the law which provides equitable protection to all relevant stakeholders, he said.
Chapter 3/1 is very similar in purpose and content to the US Chapter 11 that has provided a safe haven for many famous US airlines to restructure.
Once THAI files under Chapter 3/1, it will be able to conduct its normal business operations including passenger and cargo transportation in parallel while the reform plan gets underway under court supervision. It will be afforded considerable protection from its creditors during the process.
The acting president called it an important step for THAI to make fundamental changes in order to become a stronger and more sustainable entity.
THAI air tickets are still valid for travel and frequent flyer points can still be redeemed once services resume possibly in July. Passengers are advised to contact THAI via website thaiairways.com or contact the help centre at Tel: 02-3561111.