Kuwait Airways is carrying out its threat to force the Iraqi Government to pay reparations over war damage by seizing interests in Bombardier regional jets destined for Iraq.
The Kuwaiti carrier has obtained a Montreal Superior Court order seizing the interests of Iraqi Airways and the Iraqi Government in the Canadian-manufactured aircraft.
Iraq's Government has ordered 10 Bombardier CRJ900s as part of an initial fleet-modernisation programme which also covers 30 Boeing 737s.
Kuwait Airways has secured UK court judgements against Iraqi Airways amounting to some $1.2 billion, following the destruction of several Kuwaiti aircraft by Iraqi forces during the 1990-91 Gulf conflict.
© Simon Wilson/AirTeamImages.com
But law firm Howard Kennedy, representing Kuwait Airways, claims Iraqi authorities have failed to engage in serious discussions over payment of these reparations.
As a result, in February this year, Kuwait Airways threatened to impound any new aircraft entering the Iraqi Airways fleet.
Iraq's Government, rather than Iraqi Airways, is formally listed as the customer for the 737s and CRJ900s on order.
"Recent statements from Baghdad have suggested that the orders of aircraft to be flown by Iraqi Airways were made by the Iraqi state to avoid potential liability to Kuwait Airways," says the law firm.
It adds that it was expecting aircraft deliveries to Iraq to begin next month.
"It is not the intention of Kuwait Airways to take aggressive action for its own sake," insists Howard Kennedy partner Christopher Gooding.
"But in the absence of any meaningful dialogue, and in the light of Kuwait Airways' duty to protect public funds, Iraqi Airways and Iraq can expect further similar action to be taken without further warning."
He says the court order is a "first move in a sequence of planned enforcement proceedings" and should serve as a "wake-up call" to the Iraqi Government.
Bombardier has acknowledged the situation, but says: "Since we're consulting with our legal advisors now and since the matter is before the court, we can't comment on the issue or speculate on the outcome at this time."
Under a separate order, the law firm says, two properties in Quebec belonging to the Iraqi Government will also be seized.