Etihad Airways rebuts allegations of unfair subsidies worth $14.3bn

DUBAI, United Arab Emirates – Etihad Airways, the United Arab Emirates’ national carrier, has formally submitted a document to the United States government rebutting allegations by U.S. carriers that it receives unfair subsidies.

The airline, owned by the oil-rich Emirati capital of Abu Dhabi, announced the filing Tuesday. It is its most comprehensive response yet to an American carriers’ effort to pressure Washington to renegotiate agreements that allow airlines from Qatar and the UAE to fly to the U.S.

U.S. airlines have criticized Etihad and rivals Qatar Airways and Dubai-based Emirates over the subsidies allegations – charges the Gulf carriers have repeatedly denied. The fight has grown increasingly bitter as the Gulf airlines increase their American operations, with Delta CEO Richard Anderson earlier this year invoking memories of the Sept. 11 attacks.

In the 60-page document to the U.S. Departments of Commerce, State and Transportation, Etihad dismisses the U.S. airlines’ allegations as “not supported by fact, logic, law or treaty,” while outlining $14.3 billion it has received from the Abu Dhabi government.

That includes $9.1 billion in equity payments Etihad said it received in various tranches between 2004 and March 2015, a period of rapid growth that saw Etihad acquire minority stakes in Air Berlin, Alitalia and other foreign carriers.

In addition, Etihad said the government provided $5.2 billion in loans that must be repaid.

It argues the payments are justified given the government’s sole ownership, and “categorically rejects” claims it receives subsidies.

“Our shareholder’s equity and loans are not subsidies under any applicable definition,” the airline said. “They are the means by which the Abu Dhabi government has sensibly invested in a successful business model.”

Etihad’s filing also seeks to refute other allegations of subsidies and unfair advantages, such as Emirati labour laws that prohibit labour unions and the carrier’s dealings with other government-related entities, and says the U.S. airlines’ complaints “take a very condescending view of non-U.S. law.”

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