NCAA backs down on ‘no pay, no service’ directive against indebted airlines

The Nigeria Civil Aviation Authority has suspended plans to enforce its proposed “no pay, no service” policy against domestic airlines owing statutory charges, following consultations with operators and concerns over rising operational costs in the aviation sector.

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Director-General of Civil Aviation Chris Najomo said the decision was reached after reviewing prevailing challenges facing airlines, particularly the sharp increase in the cost of Jet A1 aviation fuel. The NCAA had earlier issued a memo on May 22 placing at least 11 domestic airlines on a “no pay, no service” list over mounting debts owed to aviation agencies.

Affected carriers reportedly included Air Peace, Ibom Air, Overland Airways, Arik Air, United Nigeria Airlines, Max Air and Caverton Helicopters, among others. Industry sources said airlines immediately opened discussions with the regulator after the directive was announced, leading to the temporary suspension of its implementation.

The NCAA clarified that the move does not amount to a cancellation or waiver of outstanding debts, stressing that all affected airlines remain fully responsible for settling their statutory obligations. According to the authority, structured engagements with operators will continue in an effort to ensure compliance while avoiding disruptions to flight operations and passenger services.

The regulator also referenced earlier measures approved by Bola Tinubu, including a 30 per cent discount on outstanding charges owed by domestic airlines to aviation agencies to help cushion the impact of high fuel costs and stabilise the sector. The NCAA defended the controversial five per cent Ticket and Cargo Sales Charge, describing it as a statutory levy established under Nigeria’s Civil Aviation Act.

It explained that airlines merely collect the charge on behalf of aviation agencies responsible for maintaining safety oversight and operational infrastructure within the industry. “The charge is not part of airline revenue or operating profit and should not be treated as such,” the authority said.

The NCAA further noted that it operates largely on a cost-recovery basis and does not receive direct federal government funding for day-to-day regulatory activities, making remittances from operators essential to sustaining oversight and aviation safety functions.

According to the regulator, suspending the enforcement action was intended to balance strict regulatory compliance with the need to maintain operational stability across Nigeria’s aviation industry. The authority added that it remains committed to recovering all outstanding debts while pursuing solutions that support both enforcement and the long-term sustainability of domestic airline operations.