Passengers stranded as Cypriot airline goes bust

In this file photo, an Airbus A320-232 plane from Cypriot carrier Cobalt comes into land at Larnaca Airport, southern Cyprus on Aug. 17, 2018. (AFP)
Updated 18 October 2018
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Passengers stranded as Cypriot airline goes bust

  • Cobalt Air said it was canceling all flights from shortly before midnight “due to indefinite suspension of Cobalt’s operations”
  • Cobalt’s grounding comes just two weeks after Latvia-based Primera Air filed for bankruptcy and a month since Belgian airline Skyworks took the same course

LARNACA, Cyprus: Cyprus said Thursday it will pay to ensure hundreds of Cobalt Air passengers stranded on the holiday island can return home safely after the sudden collapse of the low-cost carrier.
In a surprise announcement posted on its website late Wednesday, the airline said it was canceling all flights from shortly before midnight “due to indefinite suspension of Cobalt’s operations.”
It warned customers its offices would no longer be staffed and urged them to seek refunds through their credit card company or travel agent.
Cobalt’s grounding comes just two weeks after Latvia-based Primera Air filed for bankruptcy and a month since Belgian airline Skyworks took the same course.
The airline was launched only two years ago, filling the void to become the Mediterranean island’s biggest carrier after state-owned Cyprus Airways went bankrupt in January 2015.
Employing many pilots from the defunct national carrier, it went on to operate 13-15 flights daily, taking up to 3,000 passengers to 23 destinations including Athens, Beirut, Heathrow, Paris and Tel Aviv.
But late on Wednesday night, its website was abruptly replaced with a single-page statement announcing the cancelation of all of its flights from 23:50 pm.
Its last flight was reportedly in the air on the way back to Larnaca from London at the time.
“As a result, future flights or services provided by Cobalt will be canceled and will no longer operate,” the statement said, without elaborating on the reasons.
The airline advised passengers with tickets against going to Larnaca International Airport or attempting to contact its offices “as no Cobalt flights will operate and no Cobalt staff will be present.”
“We sincerely apologize once again and would like to thank our very loyal customers for their support over the last two years of Cobalt operations.”
Nine flights had been scheduled to arrive and nine to depart from Larnaca airport on Thursday.
Hundreds of passengers were left stranded, although it was not immediately clear exactly how many.
Airport authorities said there was no panic in the departures hall, with passengers appearing to have stayed away after learning about the airline’s fate and the flight cancelations.
On Thursday the Cypriot transport minister emerged from an emergency meeting on the situation to say everything would be done to minimize the inconvenience for those stuck in Cyprus and abroad.
Vassiliki Anastassiadou said Cyprus would cover the cost for passengers to return home up until October 24, while adding that this did not absolve the airline of its liabilities toward customers.
“The cost of the tickets will be covered by the state for repatriation purposes only,” the minister told reporters.
“We... feel the need to help passengers trapped either in Cyprus or abroad who want to return to their place of residence.”
Two travel operators on the island had been instructed to manage the repatriations and issue tickets on other airlines.
Anastassiadou described the situation as “regrettable” as it comes at time Cyprus is enjoying a surge in its vital tourism sector with arrivals in 2018 expected to exceed last year’s high of 3.6 million.
The minister confirmed the airline was struggling but had informed authorities it was looking for funding.
“It seems they were not able to do this, but we had also given Cobalt a deadline of October 22 to present its financial situation,” she said.
Officials told the state-funded Cyprus News Agency that Cobalt had accumulated tens of millions of dollars in debt since its first commercial flight in July 2016.
Other reports put the debt at around 100 million euros ($115 million).
They said Cobalt had ceased operations after failing to reach a deal with a potential European investor to help it pay for leasing its six aircraft — two Airbus 319s and four Airbus 320s.
Reportedly, the company had only 15 million euros left in its accounts, which it needed to pay its 200-air crew and 50 ground staff.
There was speculation that it was facing cash-flow problems after two of its aircraft were grounded for two days.
Although Cobalt refused to comment on the rumors, sources within the company reportedly attributed the liquidity problems to difficulties faced by Chinese investors in exporting capital due to Chinese government restrictions.
The airline’s largest shareholder is AJ Cyprus, with 49 percent of the shares. AJ Cyprus is owned by China’s AVIC Joy Air.
Cyprus is a hugely popular holiday hotspot for Britons — with over a million flying to the island each year.


Days from summit, May takes Brexit battle to Brussels

Updated 9 min 45 sec ago
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Days from summit, May takes Brexit battle to Brussels

  • May hopes to wring out of Brussels a Brexit arrangement that she can sell to her Parliament
  • May and Juncker were expected to cover fishing rights and the movement of goods after Brexit, as well as the duration of the transition period and the British territory of Gibraltar

BRUSSELS: Theresa May briefly escaped the Westminster bear pit to bring her Brexit battle to Brussels on Wednesday, just four days before the divorce deal is to be signed.

After enduring another parliamentary grilling at prime minister’s questions in London, the British leader crossed the Channel and met EU Commission President Jean-Claude Juncker.

The pair shook hands and posed briefly for photographers before heading into talks in the Commission’s Berlaymont headquarters for what an EU spokesman had earlier called “afternoon tea.” 

Having seen off — at least for now —  a potential leadership challenge by hard-line Brexiteers in her own party, she hopes to wring out of Brussels a Brexit arrangement that she can sell to her Parliament.

The withdrawal treaty itself is all but final, and preparations are under way for a summit on Sunday to sign it, but there remains the matter of a parallel 20-page political declaration on future EU-UK ties.

European diplomats and EU officials have been in intense talks on the declaration this week. One of them told AFP that they now expect to publish it on Thursday morning, after May’s afternoon tea with Juncker.

Neither side has much wiggle room left to polish the text, but May must show that she has left nothing on the table if she is to convince British members of parliament to ratify the deal in the coming weeks.

May and Juncker were expected to cover fishing rights and the movement of goods after Brexit, as well as the duration of the transition period and the British territory of Gibraltar, which lies on an outcrop off Spain.

May faces pressure from her Northern Irish allies, who oppose a deal they say weakens British sovereignty in their province, and from Spain, which warned it might oppose the accord over Gibraltar.

Madrid wants a veto over applying any agreement on post-transition relations to Gibraltar, but May told MPs on Wednesday that Britain “will not exclude Gibraltar from our negotiations on the future relationship.”

There is frustration among some EU countries at Spain trying to play hardball so late in the game.

“We are following the latest developments with growing concern and incomprehension —  among the EU27 our Spanish friends are all alone on this,” an EU diplomat told AFP.

Two of May’s top ministers quit last week, including her Brexit secretary, while MPs from all parties came out against it — increasing the chances that Britain will crash out of the Union on March 29 without an agreement.

A minister who opposed Brexit and who returned to May’s cabinet in a reshuffle triggered by the resignations, tried to rule out this economically disruptive scenario.

“It is my view that the parliament, the House of Commons, will stop no deal ... There isn’t a majority in the House of Commons to allow that to take place,” Work and Pensions Secretary Amber Rudd told BBC radio.

The withdrawal deal covers Britain’s financial settlement, expatriate citizens’ rights, contingency plans to keep open the Irish border and the terms of a post-Brexit transition.

Officials are now racing to agree the accompanying outline statement on the future trading and security relationship for after Britain leaves the EU’s single market and customs union in March.

Opposition to the agreement is also building in the pro-Brexit camp.

On Monday, MPs from Northern Ireland’s Democratic Unionist Party (DUP) abstained on three budget votes in the Commons and voted against a fourth, despite their deal to back the government on finance matters.

Anti-Europe Conservatives have also savaged the divorce deal, which they say keeps Britain too close to the EU.

Rebels led by MP Jacob Rees-Mogg failed in their attempt to force an immediate confidence vote in May’s leadership, but warned they would keep trying.

The withdrawal agreement sets out plans for a 21-month transition after Brexit, in which Britain and the EU want to turn their outline agreement on the future relationship into a full trade deal.