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Pretoria - Comair chief executive Erik Venter feels the company has a strong case in its battle against government bailouts to competitor South African Airways in the High Court in Pretoria.
''I think we have got a good case," said Venter during a tea adjournment at the British franchise airline's application challenging government's bailouts to state airliner SAA.
The R5bn bailout in 2014 and R6.5bn this year gave SAA an unfair competitive edge in difficult times and without consultation, Venter said, and the company wanted to know whether this was going to happen again.
Comair, for example, could not raise its ticket prices, it did not have the benefit of the extra funding to negotiate incentive contracts with customers, and SAA could afford to oversupply routes to the detriment of other companies.
He said in normal business, shareholders made a choice on whether to put money into something, but in the case of SAA it is done ''behind the scenes'' without taxpayers' representatives having a say.
If it came to point where SAA could not pay back the money, Parliament would want to know why it was not consulted, but it would be too late to avoid damage to the budget, said Venter.
Comair had been up first in the application, with counsel David Unterhalter tracing the recent history of aviation policy in South Africa during the morning session.
In 1990, he explained, the government produced a policy to allow other carriers to compete with the national carrier and stipulated that there should be a competitive environment.
In 1991 there was an addendum saying SAA must operate autonomously and under a commercial basis. In 1996 there was a white paper, which is a mechanism for policy and possible legislation, which did not change anything in the previous policy.
The Airlift Strategy of 2006, which was approved by Cabinet, presented a five-year ''airlift'' strategy for the regulation of transport for tourism growth.
This continues to be adopted by ministers and SAA, even after the five years lapsed, said Unterhalter.
He said the exits from the aviation market had been enormous.
''There is a tally of companies which have failed because the rules of the game have not been adhered to," he said.
The assistance to SAA came in the form of direct financial assistance as an equity infusion, as guarantees for a loan, and as a loan converted to equity.
The total amount would be handed up to Judge Hans Fabricius after the lunch break.
Unterhalter said that in each instance it was explained that it was an intervention by government.
If the ministers of finance and public enterprises were going to violate a principle to give collective assistance to one competitor, they should ask what harm it would do.
He said the principle of ''sink or swim'' should apply.
''They would have to do what any other company does in that circumstance - you would have to apply for business rescue. The commercial realities play themselves out, which happens all the time,'' said Unterhalter.
It was also not fair that SAA was able to get loans from banks at preferential rates because of the sovereign backing of the South African state.
Three of the big banks - Nedbank, Standard Bank, and CitiBank - are also poised to make submissions to the court on the loan guarantees.
