The Singapore International Arbitration Centre (SIAC) has recently directed US engine maker Pratt & Whitney to deliver five engines a month to grounded airline Go First from August through December.
It is to be noted that Go First had blamed Pratt & Whitney for its lack of revenues and voluntary insolvency.
SIAC has further directed the erstwhile management of Go First, which had initiated arbitration at Singapore to get an undertaking from Go First's Resolution Professional (RP) an undertaking that any costs incurred by Prat & Whitney in complying with its order and will clear its payments if the airline goes into liquidation.
SIAC said "shall not apply to any third-party Engines that are in the MRO process, as to which the engine lessors have communicated contrary disposition directions based on their pre-moratorium termination of leases with Go First."
The parties have been directed to give quarterly updates to SIAC on the progress of the resolution proceedings starting from October 1, 2023. SIAC has also given the parties a liberty to apply for further reconsideration of this order, if there is a sufficient change in circumstances.
Responding to the decision, P&W said: “Pratt & Whitney respects the Interim Arbitration ruling and will comply with the order until it is otherwise modified. We look forward to vigorously defending ourselves during the merits proceedings where the business and legal issues will be determined and resolved.”
Background:
The SIAC had, on March 30, ordered Pratt & Whitney to provide Go First with at least 10 serviceable engines by April 27, 2023, and the remainder by the year-end. Go First had revealed in a filing that it requires a minimum of 103 engines from Pratt for normal operations, yet only approximately 56 currently are serviceable.
After Pratt & Whitney refused to comply, the SIAC on April 15 issued a second arbitral award, asking the US-based company to comply with its order.
The present order replaces SIAC's previous order.
In late April, Go First moved a plea before a court in Delaware, United States, seeking enforcement of an order issued by SIAC against Pratt & Whitney.
On May 10, the principal bench of NCLT at Delhi admitted Go First's voluntary plea to initiate an insolvency resolution process. The tribunal appointed an IRP while suspending the board and putting a moratorium on the debt-ridden airline's financial obligations.
On May 22, the NCLAT upheld NCLT's order admitting the airline to involvency.
Founded by billionaire Nusli Wadia, Go First, formerly known as GoAir, filed for bankruptcy on May 2, blaming Pratt & Whitney for grounding half of its fleet due to faulty engines.
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