Loans obtained by Qatar Airways from its home government during its expansion phase have since been converted into equity and were accounted for in the company’s increased value. They should, therefore, not qualify as a subsidy.

This is among the key points made by Qatar Airways in a white paper it submitted to the US government on 30 July.

The Qatari carrier’s submission came on the heels of a similar response made by Dubai’s Emirates airline in July. Both carriers were responding to the white paper published by the US Big Three, American Airlines, Delta Air Lines and United Airlines, which urged Washington to review the open skies agreement with the three Gulf carriers, including Abu Dhabi’s Etihad Airways, in view of them receiving unfair subsidies from their home governments.

Qatar Airways began as a private airline in 1994. Half of its shareholding was acquired by the state in 1999, and it became fully state-owned by 2013.  While it admits obtaining guaranteed loans from the state between 1998 and 2000, it maintains it has never defaulted on a loan requiring the state to exercise a guarantee. This makes the Big Three’s previous finding on loan guarantee faulty, according to the white paper.  

The white paper also refutes the allegation that the low or reduced airport fees charged by Doha International airport, now Hamad International airport, comprises a subsidy citing that reduced airport charges apply to carriers that serve the airport.

Another subsidy variant levied by the Big Three against Qatar Airways is the free parcels of land provided by the state to the carrier. In its defence, the Qatari airline says the land was used for the expansion of its office and residential space, a practice it says is not uncommon even for US carriers.

Qatar Airways also maintains it does not enjoy a preferential rate for jet fuel. The carrier says it acquires fuel from Qatar Jet Fuel Company (Q-Jet) at prevailing market prices, established through the Mean of Platts Arab Gulf (Mopag) benchmark plus a differential charge.

Finally, the carrier says that its lack of a labour union, which it attributes to favourable labour conditions, should not be labelled as an unfair advantage since the US has open skies agreements with many other nations that lack organised labour.

The carrier further maintains it poses no threat to the Big Three’s operations as it does not compete against any US carrier on any non-stop route.  Instead, it has consistently worked cooperatively and fed traffic to the US carriers, including a code-sharing agreement with Oneworld alliance partner American Airlines as well as US low-cost airline JetBlue.

The firm’s group CEO, Akbar al-Baker, has also stressed in the past that his company is a major contributor to the US aviation industry as 67 of its fleet are long-range Boeing aircrafts, with another 152 units valued in excess of $50bn in order.

Al-Baker has repeatedly warned that any unilateral move by the US government to restrict the operations of his airline in the US will result in retaliative measures including their departure from the Oneworld alliance.