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WSJ: Behind Crashes Abroad, Ill-Regulated Airlines

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Old March 19th, 2007, 08:37 AM posted to rec.travel.air,alt.lawyers
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Default WSJ: Behind Crashes Abroad, Ill-Regulated Airlines

The Wall Street Journal
March 17, 2007

Behind Crashes Abroad, Ill-Regulated Airlines
Some Nations Furnish 'Flags of Convenience' Without Safety Checks

By DANIEL MICHAELS in Rome and ALAN CULLISON in Bishkek, Kyrgyzstan
March 17, 2007; Page A1

Kam Air Flight 904 was approaching Kabul on Feb. 3, 2005, when it
slammed into a mountaintop. The crash killed all 104 people on board
the Boeing 737 jet, including American and Italian aid workers.

The accident's cause remains a mystery. Kam Air, a small, private
Afghan carrier, had leased the plane and its crew from a company
registered in Kyrgyzstan, Phoenix Aviation, and neither outfit could
offer clues. The plane's voice recorder was never found amid wreckage
strewn across a snow-covered minefield, and a recovered data recorder
was blank due to a technical failure.

Although the investigation ended inconclusively (See the report1), it
prompted the European Union to place Phoenix Aviation on its blacklist
of nearly 100 foreign carriers considered too dangerous to fly within
the EU.

This blacklist, originally created to ensure the safety of EU
citizens, is now shedding light on an obscure but widespread threat to
global aviation. Even as air travel grows safer in the developed
world, a parallel universe of hazardous aircraft exists across Africa,
the Middle East, Latin America and the former Soviet Union.

The root of the problem is "flags of convenience," or countries --
mainly in Africa and the former Soviet Union -- that register carriers
without properly regulating them.

The phenomenon is similar to a trend that has plagued maritime
commerce. Liberia and Panama, for example, gained notoriety in the
1970s as flags of convenience. These nations indiscriminately
certified decrepit freighters and tankers, some of which sank with
their crews or caused devastating oil spills.

According to EU and United Nations officials, there are potentially
hundreds of planes in dozens of countries that are either illicit or
operate on the edge of illegality. Their operators put passengers'
lives at risk by flying with little regard for safety, and they
endanger many more people on the ground by funneling money and weapons
that fuel wars. Numbers are hard to come by, but crashes of suspect
carriers have killed several hundred people over the past four years.

Phoenix Aviation illustrates the menace. In examining the Kam Air
crash, investigators discovered that Phoenix, the plane's lessor, held
an operating certificate from Kyrgyzstan, an impoverished former
Soviet republic. Phoenix's headquarters, however, were actually a
continent away in the United Arab Emirates.

Escaping Oversight

By registering in one country and operating from another for many
years, Phoenix escaped oversight that might have prevented the Afghan
crash, Western aviation officials say. Phoenix last year ceased
operation. The company's former owners could not be reached for
comment in Kyrgyzstan or the U.A.E., and former managers declined to

Kyrgyzstan, Liberia and Equatorial Guinea are among the countries
singled out for failing to monitor air-operation licenses.
International safety officials say regulators from these countries
don't check where the planes they license actually fly, or even
whether they ever land on home soil.

Unscrupulous or criminal aircraft operators, in turn, move among these
havens to chase fast profits by flying cargo without asking questions
and carrying passengers without taking basic precautions.

These operators "create an airline like they'd set up a fruit-juice
factory," says Paul-Louis Arslanian, director of France's aircraft-
accident investigation bureau, known as BEA.

Officials from Equatorial Guinea, Sierra Leone and Kyrgyzstan say they
are trying to improve regulation. Regulators from Liberia could not be
reached for comment.

The problem of unregulated carriers emerged as a byproduct of the Cold
War's end and economic globalization. The Soviet Union's breakup in
1991 left hundreds of Antonovs, Ilyushins and other rugged cargo
planes in the hands of almost anyone who could grab them.


Mainstream airlines compounded the problem by modernizing their
fleets. Thousands of outdated jets landed on world aircraft markets at
garage-sale prices. Many wound up in Africa, Latin America and parts
of Asia, carrying passengers on routes shunned by established

Africa, in particular, became a magnet for rickety aircraft and
profiteers willing to land where conventional freight carriers fear to
fly. A surge in demand for raw materials sparked a Wild West-style air
cargo market that has even figured in recent movies, including "Blood
Diamond" on the illegal diamond trade.

Africa's wars also created an import market. Weapons dealers in the
Balkans and Eastern Europe shipped munitions to both sides in
conflicts like Angola's battles for oil and minerals, Rwanda's ethnic
feuds and Liberia's civil war. (See more information12.)

"It can be arms, it can be natural resources -- people just want to
make big profits at the smallest cost possible," says Abdoulaye
Cissoko, an aviation expert from Mali working on a U.N. panel
monitoring an arms embargo on the Congo.

In 1996, a Russian Antonov cargo plane, overloaded with weapons for
Angolan rebels, failed to get airborne from the airport in Kinshasa,
Zaire, and plowed into a crowded market, killing more than 300 people

Over the following years, as officials from the U.N. and researchers
from Amnesty International and other groups focused on how weapons
were reaching conflicts across Africa, they zeroed in on a handful of
middlemen. One person fingered as a kingpin of weapons dealing and
transportation was Viktor Bout, a Russian citizen and former KGB

A U.N. team monitoring the arms embargo on Sierra Leone in December
2000 said Mr. Bout controlled "a complex network of over 50 planes,
tens of airline companies, cargo charter companies and freight-
forwarding companies, many of which are involved in shipping illicit

The team gathered evidence at remote airfields, in offices of shell
companies and through interviews with air crews and managers. Its
report, and later investigations, detailed an operation based on money-
laundering, forged documents, painted-over aircraft tail numbers and
planes licensed using flags of convenience. (Part 113 | Part 214)

The U.S. Treasury in April 2005 slapped sanctions on 30 companies
linked to Mr. Bout and four of his associates, labeling him "an
international arms dealer and war profiteer." Mr. Bout, who lives in
Moscow and could not be reached for comment, has eluded authorities.
In a December interview on Russian TV, he denied charges against him.
(More on the Russia Today interview15.)

Alongside Mr. Bout's network, investigators found scores of other
shadowy, transient carriers, among which planes trade repeatedly. For
example, Air Cess and Santa Cruz Imperial -- companies blacklisted by
the U.S. Treasury for links to Mr. Bout -- several years ago operated
aircraft that ended up in the fleet of Phoenix Aviation, according to
AeroTransport Data Bank, a Web site based in Paris that tracks planes

Aircraft and operators that flit among nationalities to avoid
oversight present "the biggest problem in African aviation,"
accounting for around half of all aircraft accidents, says Nigerian
Civil Aviation Authority Director General Harold Demuren, who is
trying to fix Nigeria's woeful safety record with its own carriers.

Some of these dodgy airlines carry emergency relief and workers. The
U.N. Humanitarian Air Service, or UNHAS, part of the World Food
Program, is often first on the scene at earthquakes, floods and wars,
operating in areas without airports. To do this, it uses carriers
willing to fly in almost any conditions. Officials try to enforce
strict safety standards, but face harsh economic realities.

In Sudan, UNHAS set a 13-ton weight limit for Antonov-12 freighters.
But officials have seen the same planes flying for other clients with
21 tons of cargo, said Pierre Carrasse, head of the aviation section
at UNHAS headquarters in Rome.

"Someone gives the pilot $300 to carry extra cargo, then someone else
gives the first officer $300, and soon you've got to 21 tons," Mr.
Carrasse said in an interview. While the powerful turboprop can
usually lift off, flying becomes far more dangerous with an overloaded

Threat to Passenger Flights

A similar disregard for safety threatens passenger flights. Union des
Transports Africains Flight 141 on Dec. 25, 2003, was scheduled to fly
to Beirut from Cotonou, Benin, on Africa's Atlantic coast. The
geriatric Boeing 727 was packed with passengers and baggage stowed in
an "anarchic manner," concluded inspectors from France's BEA, who were
called in by Benin to investigate. (Read the report in English17.)

The overloaded plane, unable to climb, smashed into a shack at the end
of the runway and plunged into the ocean, killing around 145 people,
although passenger figures were one of the "numerous inconsistencies"
BEA investigators found.

The BEA also discovered that the 727 had changed hands three times
between its purchase out of storage in California's Mojave Desert in
January 2003 and the crash. As it jumped among companies registered in
Afghanistan, Swaziland and Guinea, no national authority inspected the
plane and no maintenance documents were kept -- a gross safety lapse,
the BEA found.

Chart: http://tinyurl.com/33ralo

The plane's cockpit lacked basic emergency equipment and operating
documents. The crew was not certified to fly a 727, and UTA's ground
staff had no training in loading aircraft.

"A flight is not a game of chance, luck should not play a part in it
and all of the calculations show that the takeoff should never have
been attempted," wrote Mr. Arslanian, the BEA chief, in the final
accident report.

The UTA crash drew little attention, but a series of accidents that
killed hundreds of Europeans on unknown carriers in locations from
Egypt to Venezuela sparked calls within the EU for tighter supervision
of foreign airlines. EU officials reacted in late 2005 by announcing
plans for a blacklist of unsafe carriers around the globe.

Europe's push for safety -- and its budding battle against flags of
convenience -- quickly spread to other parts of the world. As the EU
presented its blacklist, the U.N.'s International Civil Aviation
Organization also moved to tighten safety enforcement at a meeting in

Then in May, aviation officials of the African Union met in
Libreville, Gabon, to improve mutual safety inspections and support.
(See the list18) By August, Ukrainian plane maker Antonov bowed to
international pressure and published a list of 75 aging aircraft it
had built that engineers deemed unsafe for continued flying. ICAO
rules oblige all countries to ground the planes.

Safety officials said this increased vigilance in Africa boosted the
appeal of Kyrgyzstan. A Central Asian country of five million people,
snowy mountains and shepherds who drink fermented mare's milk,
Kyrgyzstan became a magnet for cowboy carriers.

Vera M. Perelygina, president of Kyrgyzstan's Itek Air, estimates that
no more than six of her country's 27 registered airlines actually do
business there.

Itek, which was founded in 1999, is one of the few that does serve the
Kyrgyz market, from its base in the capital, Bishkek. Ms. Perelygina
said many newcomers appear to be "temporary airlines" with little
presence but a desk and telephone, established for one-off operations
like hajj flights to Mecca.

"If you can fly, say, 200 people there and back, then you really don't
have to work the rest of the year," because it's so profitable, Ms.
Perelygina said.

EU officials visited Bishkek in September to meet airline officials
and regulators. Managers from one Kyrgyz-registered carrier that
apparently had no office in the country received the inspectors in a
coffee house, EU officials say. Another meeting occurred in a hotel.


EU specialists say they found Kyrgyz Civil Aviation Authority
officials receptive to improving safety but still had to blacklist all
27 of the country's airlines, including Itek, for safety reasons.

Kyrgyz officials were furious. "They don't understand our money
problems," fumed Kyrgyz CAA deputy head Alymbai Abakirov days after
the Oct. 12 blacklisting. CAA staff are being lured away by higher
salaries in the Middle East, he said in his office at the agency's
headquarters, a crumbling, disused control tower accessible only by a
rutted road.

Mr. Abakirov admitted that his agency lacks resources to police a list
of air carriers that has almost quadrupled from only seven in the past
five years. Many inspectors supplement their $50 average monthly
salary by moonlighting as safety consultants for the same carriers
they regulate, said Mr. Abakirov. On his desk sat a clock inscribed,
"With compliments of Phoenix."

Phoenix Aviation illustrates how hard suspect carriers can be to pin
down. After the Kam crash, Phoenix split into several new companies,
say Kyrgyz and international aviation officials.

At Bishkek's Manas Airport, where Phoenix kept an office, the owners
of a company called Phoenix Agency deny any relation to the lessor
whose plane crashed outside Kabul. Mr. Abakirov at the Kyrgyz CAA said
contact details for Phoenix Aviation's successors are secret --
although most air authorities world-wide consider such information

Phoenix's old phone number and post office box number in Sharjah, in
the U.A.E., are now used by a U.A.E.-registered carrier called
AVE.com, which in December 2005 ran a wanted ad for aircraft in
Speednews, an industry publication, describing itself as "previously
Phoenix." A number of AVE's planes formerly flew with Phoenix,
according to AeroTransport Data Bank and other aircraft registries.

AVE marketing official Sergei Shcherba said by phone from Sharjah that
several former Phoenix staff now work at AVE. But he said that "AVE is
a different company from Phoenix" and denied a connection.

The real successor to Phoenix, he said, was an airline based in
Kyrgyzstan -- Max Avia -- which has also flown Boeing 737s previously
operated by Phoenix, according to independent aircraft registries. But
Max Avia executive Alexander Puchyev also denied any link to Phoenix,
though he said some former Phoenix staff now work for his carrier. Max
Avia's marketing manager in Sharjah, Arsen Babayev, said by phone that
Phoenix had ceased operating in 2005.

"It is now called AVE.com," Mr. Babayev said, pointing the finger

The EU blacklist, meanwhile, hasn't stopped Kyrgyz airlines like Max
Avia from flying. Mr. Babayev said his carrier mainly flies in the
former Soviet Union and Middle East, avoiding Europe.

"I don't think it has affected us much," Mr. Babayev said. "Apart from
the bad publicity."

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