The Nigeria Civil Aviation Authority has suspended its “no pay, no service” directive against indebted domestic airlines amid growing concerns over industry stability and rising operational costs.
The directive suspension follows consultations across the aviation sector and a review of the financial strain facing local carriers, especially the sharp increase in Jet A1 fuel prices. However, the regulator stressed that airlines still remain fully liable for all outstanding statutory charges owed to aviation agencies.
Airlines named in the directive include Air Peace Limited, Ibom Air Limited, Arik Air Limited, United Nigeria Airlines, Umza Air, NG Eagle, Max Air Limited, Caverton Helicopters, Overland Airways, Rano Air and ValueJet.
Directive Cancellation, Not Waiver
Director-General Civil Aviation, Chris Najomo, said the temporary suspension should not be interpreted as a waiver or cancellation of debts. According to him, the decision only provides room for structured engagement with airlines to ensure repayment without disrupting operations.
“It is important to state clearly that this suspension does not represent a cancellation, waiver, or forgiveness of outstanding statutory financial obligations,” Capt. Najomo said.
He explained that President Bola Ahmed Tinubu had earlier approved a 30 per cent discount on outstanding fees owed by domestic airlines to aviation agencies. The relief package, announced through the Ministry of Aviation and Aerospace Development, was designed to cushion the impact of escalating aviation fuel costs on operators.
Meanwhile, the NCAA clarified that the debts largely relate to the 5 per cent Ticket and Cargo Sales Charge (TSC/CSC), which airlines collect from passengers and cargo operators at the point of sale. The Authority stressed that the funds do not belong to airlines and must be remitted accordingly.
“The 5% Ticket and Cargo Sales Charge is a statutory component of the aviation system in Nigeria required by the Civil Aviation Act,” the statement noted.
The regulator further explained that the charge is embedded in ticket and cargo pricing and serves as a key funding source for aviation oversight and safety functions. According to the Authority, the revenue supports not only NCAA operations but also other aviation service providers responsible for maintaining safe and internationally compliant aviation standards.
Capt. Najomo said the directive became necessary because the NCAA operates on a cost-recovery basis and does not receive direct federal funding for its daily regulatory responsibilities. Therefore, statutory remittances remain critical to sustaining safety oversight and industry monitoring activities.
“It must be emphasized that this charge is collected at the point of ticket and cargo sales by airlines on behalf of the aviation ecosystem,” he added.
The Authority maintained that the temporary suspension of the directive was carefully calibrated to avoid avoidable disruption within the sector. It noted that aggressive enforcement at a time of mounting operational costs could worsen the fragile financial condition of some domestic operators.
Industry stakeholders have repeatedly warned that airlines are struggling with multiple economic pressures, including foreign exchange scarcity, high maintenance costs, insurance obligations, and the soaring price of Jet A1 fuel. These challenges have affected cash flow across the sector and complicated remittance obligations to aviation agencies.
However, the NCAA insisted that the principle behind the directive remains valid because the charges had already been collected from passengers and cargo users for statutory purposes.
“The industry continues to function without avoidable disruption, while still upholding the principle that statutory charges already collected must be remitted for their intended purposes,” the statement added.
The Authority said it would now pursue structured repayment discussions with each airline individually. The approach, according to the regulator, aims to balance enforcement with operational sustainability while ensuring long-term compliance.
Analysts say the suspension of the directive may offer temporary relief to struggling airlines. However, they also warn that unresolved debt obligations could continue to affect the financial stability of aviation agencies if repayments are delayed further.
The NCAA has repeatedly emphasised that safety oversight cannot be compromised due to funding shortages. Therefore, the regulator is expected to intensify monitoring and engagement with operators in the coming months as repayment structures are finalised.
Meanwhile, industry stakeholders are urging the Nigeria Civil Aviation Authority to adopt a Billing Settlement Plan (BSP)-style payment structure to prevent future accumulation of statutory debts. According to them, such a system would allow Ticket and Cargo Sales Charges to be automatically settled at source, leaving only previously outstanding obligations for reconciliation.
Stakeholders argued that adopting a centralised remittance framework similar to the global BSP model used by airlines and travel agents could improve transparency, strengthen compliance, and reduce financial disputes within Nigeria’s aviation sector.
