PAL asks Pasay Court to recognize US Chapter 11 bankruptcy protection filing


Posted at Sep 22 2021 12:15 PM

MANILA - Philippine Airlines said Wednesday it filed a petition in a Pasay City Court for the recognition of its Chapter 11 filing in the US.

"In accordance with the over-all plan in regard to the filing of the Chapter 11 petition before the US Court of New York, we confirm that a petition has been filed by Philippine Airlines Inc. before a Pasay City court," the airline told the stock exchange. 

The principal purpose is to ensure "that the local courts will recognize formally the Chapter 11 process and the corresponding decisions the New York court may grant or award," the statement said.

PAL added that most of its investors and creditors are US-based.

The petition was filed on Sept. 20, PAL president Gilbert Santa Maria said in a forum held Tuesday.

Filing a local recognition is in compliance with the Financial Rehabilitation and Insolvency Act of 2010 or RA 10142, he said. 

Operations, nevertheless, remain business as usual including repatriation flights and vaccine deliveries, Santa Maria said. 

“Hanggang ngayon, lumilipad pa kamin ng vaccines, lumilipad pa rin kami ng OWWA repatrations, at repatrations ng overseas workers na naiipit sa labas. But the most important contribution to the economy is to link our islands, and to link our islands to the world," he said earlier. 

(We continue to fly vaccines, we fly OWWA repatriations and repatriations of overseas workers stuck outside the country)

PAL operator PAL Holdings Inc in 2020 incurred a net loss of P73 billion partly due to the impact of the COVID-19 pandemic.

A Chapter 11 filing means the airline is allowed to keep operations and pay creditors over a period of time.

The flag carrier earlier said a US bankruptcy court has granted it access to a $20 million loan facility. 


Watch more on iWantTFC