asked the Minister for Transport the reason Aer Lingus were not allowed to complete the sale of a Boeing 707 to Libya in view of the heavy cost incurred in preparing this aricraft for this particular sale; and the action he proposes to take to complete the sale or recoup the loss incurred.
Ceisteanna—Questions. Oral Answers. - Aircraft Sale to Libya.
10.
Earlier this year, Aer Lingus made arrangements for the sale of a Boeing 707. The aircraft was to be delivered in the colours of United African Airlines, Libya.
Before the sale was completed, the US authorities brought to Aer Lingus' attention a US Department of Commerce Regulation made in 1978 which stipulates that the prior approval of that Department must be obtained to the re-export of particular categories of equipment to certain desiganted countries, including Libya. In addition, the US Department of Commerce made a specific order on 1 September 1981 prohibiting any person from exporting or re-exporting items which originated in the US to the named purchaser with whom Aer Lingus were dealing or to United African Airlines.
Having reviewed the position in the light of these developments and after consultation with my Department and the other Departments concerned, Aer Lingus decided in all the circumstances not to proceed with the sale and refunded the deposit paid by the purchaser.
The company are, of course, actively pursuing other means of disposing of the aircraft.
Will the Minister state if his Department agreed to the sale of this plane to Libya in the first instance and at a later stage withdrew permission to export the plane to Libya?
Offhand I cannot say if my Department would have to be consulted with regard to the sale. However, without checking on the matter, I can only say that I would imagine it would be a commercial decision for Aer Lingus to sell surplus aircraft without getting approval from the Department. We were probably informed. It was not a question of withdrawing consent. It was that Aer Lingus were informed by the US authorities of their prohibition and decided to observe it.
Apparently the sale is not going through at this time. Is the Minister taking any action to recover the $1.2 million spent on preparing the aircraft for sale?
The figure the Deputy has given of what was spent on the aircraft is substantially incorrect. I do not know from whom Aer Lingus could recover the cost.
Does the Minister not consider that the intervention of the US authorities resulted in what was tantamount to a breach of contract between Aer Lingus and Libya in relation to the sale of this aircraft and that somebody should be responsible for recouping Aer Lingus?
I sympathise with the view of the Deputy. He can be assured that the strongest representations were made with regard to this matter.
Will the Minister not accept that the same regulations should apply to any other country who have bought Boeings from Boeing in Seattle?
Yes.
Is the Minister aware that a Boeing 707 was sold recently to replace the Aer Lingus plane by the Belgian authorities who ignored the information the Minister is putting forward here in relation to the US authorities?
That is a matter for the Belgian authorities. Without knowing the full facts I do not know why they decided to do that, whether they were given an exemption or whether the aircraft had equipment in it that was not caught by the regulation. So far as Aer Lingus were concerned, having considered the matter fully they decided not to proceed with the sale.
This matter has serious implications for our trade with Libya. The Libyan people view us as a neutral country. We refused to complete the sale to the Libyan authorities but the Belgian authorities have now completed a sale for a Boeing 707. The same conditions should have applied in that case also but obviously the Belgian Government took a totally different view. Libya is our eighth best customer and I ask the Minister to review the situation. There are many other ways of getting round the regulation with regard to the sale of the aircraft if the Minister is interested. I would remind the Minister that there is a 707 on lease in Libya since last April and it will be there until next October. I believe the lease could be renewed. In view of the action taken in this matter, our exports to Libya and our future trade with that country could be in jeopardy.
As I have said already, both Aer Lingus and I regret that the embargo was imposed on this sale. However, having considered all the implications — and obviously there are many implications in a matter such as this — it was decided not to proceed with the sale. I am aware that the lease to which the Deputy referred is still extant. The embargo was not applied by the American authorities when that lease was entered into and consequently, it is a different transaction. Further, I am aware that the Libyan authorities are appreciative of the position in which Aer Lingus found themselves and I do not think our trading relations with that country will be prejudiced. I would add that Aer Rianta have been successful in securing a contract to train Libyan citizens over a two-year period as aircraft mechanics.
I am well aware of the Aer Rianta contract. It was entered into subsequent to the action in relation to the sale of the 707 plane. Will the Minister not accept that the Irish Government have been weak-kneed in relation to this matter? They should have taken a stand and completed the sale. We see now what Belgium has done. Is the Minister aware that in the past four weeks the British authorities have entered into a contract to train many people and are making aircraft available also? We are being left out in the cold.
I cannot agree with the Deputy that there has been any weakness with regard to this matter. The Deputy is obviously unaware of the fact that the vast majority of the Aer Lingus fleet is supplied by the Boeing Company under regulations prescribed by the American Government. He is also overlooking the fact that Aer Lingus recently set up a very big plant called Airmotive in the old Potez factory on the Naas Road. Much of its work is concerned with the refurbishing of Boeing jet engines and obviously they will have to depend on the Boeing suppliers for parts for that factory. There are implications here of which the Deputy is well aware. It does not do to try to make political points——
We cannot have a debate on this matter.
I am aware of the implications. However, the Minister should accept that the Irish Government have been weak-kneed in dealing with this situation. It is quite clear that the same regulations applied to the Belgian Government but they took a different view also. It is time we took a different view also.