Authorities mull exit tax for leaving Russia

Travelers might soon be obliged to pay to leave Russia as officials are considering a new exit tax for international passengers.
The levy is needed to boost domestic flight demand which would be freed of the value added tax, according to the proposal submitted by the Transport Ministry.
Ticket prices for international routes might rise by up to 1,000 rubles, but experts are dubious as to whether flying within the country’s borders will become cheaper.
Zero VAT on domestic flights could leave the budget without annual 32 billion rubles, but transport officials want travelers to plug that hole.
Exit taxes for international flights have been proposed “from national airports for all commercial flights regardless of the carriers’ national identity.
The document has been submitted to the Finance Ministry, which has yet to announce its decision.

Aeroflot’s Superjet starts regular flights to Western Europe.

Aeroflot has conducted its first international flight using Russia’s new Sukhoi Superjet 100. The new regional-class jet aircraft completed the Moscow-Oslo-Moscow route, landing in Oslo at 7 pm on Sunday and then returning to Moscow’s Sheremetyevo. Aeroflot also plans to use the aircraft to fly a regular route between Moscow and Budapest by the end of the year.

Russia bans European flights for several domestic airlines

Russia's Aviation Agency Rosaviation restricted the flights to Europe for six Russian airlines. The new regulations touch upon the following companies: VIM-Avia, Dagestan Airlines, Tatarsran, Yakutia, Aviastar-Tu and UTair cargo.

The head of Rosaviation, Alexander Neradko, told reporters yesterday that the agency restricted the European flights for those airlines after SAFA (Safety Assessment of Foreign Aircraft) lowered the safety coefficient for the airlines.

The restrictions can be lifted, but it will depend on how the airlines manage to remove the drawbacks of their work and whether they demonstrate the readiness not to let such violations occur again.

"This program exists for many years, and I feel uncomfortable in front of our European colleagues because our airlines continue to make childish violations. They probably hope that SAFA inspectors will leave them out of attention," Neradko said.

It was previously reported that the European Commission was going to consider the issue about blacklisting several Russian airlines, including VIM-Avia, Dagestan Airlines, Yakutia and Tatarstan. This black list bans airlines from flying to Europe. It just so happens that Rosaviation has taken the lead at this point.

Poland acknowledges it's pilot's fault

The Polish government commission has published its conclusions on the causes of the crash of the Tu-154 near Smolensk. Despite the attempt to shift some of the blame on Russia, for the most part the position of the Poles coincides with the findings of the commission of the Interstate Aviation Committee (IAC).


The airplane of the Polish President Lech Kaczynski's Tu-154 crashed during landing at an airfield near Smolensk North in the morning of April 10, 2010. During the landing it caught the tops of the trees due to a low visibility caused by a heavy fog. There were 96 people on board - 88 passengers and eight crew members. None have survived.

On January 12 of this year, the Interstate Aviation Committee issued a final report on the results of the technical investigation of the accident, according to which the immediate cause of the crash was the decision of the crew not to go to the alternate airport, as well as systemic factors such as shortcomings in providing flight crew with training.


According to experts of the IAC, the crew had to take the reports of adverse weather conditions into account. According to the Chairman of the IAC Tatyana Anodina, despite the warnings of adverse meteorological conditions at the destination aerodrome, the crew of the Tu-154 has not taken a decision to go to an alternate airfield. At the same time, said Transport Minister Igor Levitin, the Russian managers were unable to prevent the special aircraft from landing as the decision in such situation is taken by the Captain.

In addition, as stated by the chairman of the IAC, the crew was not prepared for the critical flight. According to her, the crew

At some point, the chances to avoid the catastrophe were virtually nil, according to the IAC. The maneuver to avoid a collision with an obstacle was made by the crew at the last minute. The maneuver was very sharp, and the flight recorder recorded that at the time of the collision with a birch tree the aircraft was beyond the operational angles of attack, said the head of the Technical Committee IAC Alexei Morozov. He added that if there had been no clash with the birch, most likely in two or three seconds, the aircraft would have reached the regime of the so-called stall and subsequently collided with the ground.

In addition, it was established that at the time of landing Air Force Commander of Poland Andrzej Blasik was in the cockpit. According to the conclusions of the experts, his presence put pressure on the pilots and influenced their decision to land the plane at Smolensk, at any cost, despite the warnings from the air traffic controllers.


The report of the Interstate Aviation Committee in Poland received various responses. For example, the brother of the deceased president, Jaroslaw Kaczynski said at a session of the Seim that the direct causes of the tragedy were the responsibility of the Russian side. Polish opposition tried to use the tragedy in Smolensk for its own purposes. It looked so cynical that the Prime Minister Donald Tusk had to calm down some MPs and politicians with their anti-Russian rhetoric. He stated that the truth of the catastrophe cannot be a pretext for a political adventure.

At the same time, the experts, including Polish ones, agreed that the investigation was conducted competently and eliminated any questions about the causes of the tragedy near Smolensk.
"The committee, which conducted the investigation, coped with the task professionally," said the head of Yates Consulting, British aviation expert Chris Yeyts. The Committee concluded that, in the first place, the fault lies with the Polish pilot and his assistant. In the transcription of the conversations between the pilot and those who were on the ground during the last attempt at a landing, lies an important detail: the landing at the airport was not possible.

The British expert is convinced that with this information, the pilot had to follow the instructions of the controller and go to a nearby airport, where conditions were better for a touchdown.

"The pilot's error is the main cause of the crash. There were also problems with the preparation for the visit. I would say that it was not the pressure on the military pilots, but the mistakes and failures in their work led to the tragedy," said a Polish military expert, a former Air Force pilot Michal Poland Fizer. "The lack of experience in flight is one thing, but lack of life experience is another. When you're thirty-five, you have no life experience and a lot of ambition. You're trying to do the job because the president expects you to land the plane in a certain place. And you want to prove to him that you are able to do it. "

The accredited representative of Poland at the MAC Edmund Klich shares this opinion. "I am sure that most of the causes of the crash near Smolensk are on us. We cannot even talk about any misconduct on the part of Russia," he said. "A good crew with a good aircraft (there was no information that the Tu- 154 was defective) cannot land this way. Even if there were different orders from the team".

Similar conclusions were reached by the Polish government commission that investigated the causes of the catastrophe whose final report was published on Friday, July 29. Earlier, the head of the commission, the Interior Minister Jerzy Miller has repeatedly stated that, based on the data available to the Commission, the main fault lies with the Polish side. Miller warned that the report will be "harsh" and "painful" for Poland.

Nevertheless, the report states that "the airport did not provide the flight safety, including, due to poor visibility." It is not clear how the airport services could have affected the fog. In addition, as already stated, the decision to land was made by the crew, and not under pressure of the Russian dispatchers.

Another discrepancy with the report of the IAC is that, according to the Polish commission, a warning system TAWS was not configured on the presidential airplane. "TAWS unit was poorly prepared for a flight to Smolensk. Its preparation and activation was the responsibility of the co-pilot", said the experts presenting the report in Warsaw. At the same time, IAC reported earlier that, as established by professionals, TAWS system and onboard computers on the plane of President Kaczynski were in good condition. The tests were conducted in the laboratory of Research Center UASC in the U.S. "It is established that the equipment in flight on April 10 has been properly installed and provided the crew and aircraft systems with necessary information", stated MAC.

However, in general, the report of the Polish Commission coincides with that of the MAC. According to the findings of the Poles, the crew did not want to land, it wanted to test the landing, which proved fatal. "The crew had no opportunity to go to the second round," the document says.

As for the presence of head of the Air Force in the cockpit, the "Polish commission found no evidence that the head of the Air Force immediately put pressure on the crew to land the plane. Nevertheless, the crew was under pressure because of the high-level flight and due to the fact that the first person in the country was on board." However, the following conclusion was also made: "The work of the crew was chaotic, a third party interfered in the work by his appearance in the cockpit, the pilot, the commander was busy with radio communication."

The pilots were not paying attention to the TAWS, which was operational. "The crew ignored the warning of the TAWS. The landing procedure was taken at 60 meters below the permissible level," the report says.

In addition, the experts of the Polish Commission believe that the pilots did not respond to an error in the "test landing", and the commander of the crew made a wrong call.

Polish experts strongly agreed with the conclusions of the IAC in regards with bad preparation of the Air Force pilots of the country. "Errors in the preparation of the pilots, their training, created a threat. The control over their training was inadequate," says the report.

The conclusions of the Polish Commission shall affect neither the political situation in the country, nor the relationship between Poland and Russia as they are fundamentally not different from the findings of the MAC. "We have investigated the causes of the incident, and not the fault of the parties. The Commission does not investigate who was responsible for the catastrophe," said Jerzy Miller, Poland's Interior Minister, answering a reporter's question whether Russian or Polish side and to what extent was responsible for the tragedy at Smolensk.

However, most likely, the Polish opposition will once again try to use the report for its own purposes, playing, as usual, the anti-Russian card. However, the tragedy took place more than a year ago, and all who wanted have already formulated their view on this subject. The political hysteria, even if happens, will quickly subside.

Police raids at Domodedovo

Police and investigators swooped on Domodedovo airport Thursday in a day long raid, kicking employees off their work stations into the corridors, seizing computers and pulling out the ceilings.

There was no disruption to flights, but it is yet another sign that the knives are out for Moscow’s largest transport hub, and the signs are that it boils down to a clash of personalities.

Two different reasons were reported for the raid. One was that security forces were out to grab documents pertaining to ownership, President Medvedev himself has said he is not happy with the status of Domodedovo’s management.

The other reason was to follow up a criminal investigation into security shortcomings that, for one, allowed a suicide bomber to kill 37 people and injure 173 in the arrivals hall in January, Interfax reported.

Unconvincing

Neither of these persuade Nikita Melnikov, a transport analyst at Aton Brokerage, “I think that all these things, these security issues and the state declaring that the police actions are because of the terrorist act or this woman who boarded a plane with no ticket, can be taken as a base to return to the question of ownership,” he told The Moscow News.

Airline tycoon Dmitry Kamenshchik is 100 percent owner of the airport. He’s the 86th richest man in Russia with a net worth of $1.1 billion, according to Forbes magazine.

“To be honest, I think that all these things are connected with the president’s idea, and not just the president’s, that Domodedovo is not fairly owned by Mr Kamenshchik…The state has a long history of conflict with Mr Kamenshchik,” Melnikov said.

he hostile attitude is unmerited, says Melnikov, as Kamenshchik has turned the airport around and brought it up to speed with the modern world, making Domodedovo the Moscow airport of choice for most international airlines.

“When we have a successful business of which the origins are not very clear then the state shows an interest in how this business is run,” Melnikov said by telephone. He added that this conflict is likely to continue until Kamenshchik takes on board some of the state’s ideas.

“It seems that we know who the owner is, but a check is underway. The owner is hidden behind the structure of beneficial owners” President Medvedev said, apparently unconvinced by the IPO document declaring Kamenshchik as the owner, as reported by Radio .

“And this is our largest transport hub and where there is the largest number of planes!” he exclaimed.

The origins of the airport’s private ownership, back in the topsy-turvy days of perestroika, are indeed hard to trace and the deeds have changed hands at least 13 times, financial analyst Andrei Sotnik told Radio Svoboda.

The powers that be are unlikely to be able to trace those origins as many of them lie overseas. But Sotnik does point out that the original owners, East Line, were a Soviet group, “I doubt that a Soviet era firm with overseas ties came into being without KGB ties,” he said.

The airport, meanwhile, is choosing discretion, “The airport is directly interested in an objective investigation and Domodedovo has been actively cooperating with law enforcement agencies and investigators at all stages of the investigation from the moment it began in January 2011,” the airport’s press service announced.

Time to ground Tu-134s - Medvedev

Russia’s Tu-134 fleet is set to be grounded, President Dmitry Medvedev said during a visit to RIA .

Following Monday’s crash in Petrozavodsk the president said it was time to retire the Soviet-era workhorses of the sky from service.

However, preliminary analysis of flight recorders suggests that the crash was not due to any technical problem with the aircraft, and pilot error is believed to be the most likely cause.

US, Ukraine Firms Tie Up For Pentagon Tanker Contract Bid

NEW YORK, NY -- A US aerospace company on Friday announced a tie-up with a state-owned Ukraine aircraft maker to bid on the Pentagon's 35-billion-dollar contract to supply aerial refueling tankers.
US Aerospace, Inc. said it had entered a "strategic cooperation alliance" on Thursday with Antonov Company, in a filing with the Securities and Exchange Commission (SEC).

"Under the terms of the agreement, Antonov will be responsible for design, construction and manufacture of aircraft. We will be responsible for coordinating the bidding process, negotiating and contracting with customers, and coordinating with defense sub-contractors for specialized systems," the small California company said in the filing.

But the press office at Antonov refused to comment on the matter and said it was unaware of the agreement.

The alliance provides the Ukrainian state firm, a top cargo plane maker, with the sale of its aircraft, products and services in the US, the filing said.

US Aerospace said the alliance would be dissolved if the partners, which are not only interested in supplying the Defense Department with 179 tankers, obtain no contract within five years.

If they enter the tanker race, where bidding is due by July 9, the team will compete against US aerospace giant Boeing and European rival Airbus, the world's leading aircraft maker.

The Pentagon is expected to name the winning bid in a few months in the long-running contract battle, which has pitted Boeing against Airbus for seven years.

US Aerospace, according to documents on the SEC website, is the new name for New Century, adopted in April.

In May, the company reported a quarterly net loss of 1.8 million dollars and 7,205 dollars in cash as of March 31.

Aeroflot Board Dismisses Embattled CEO

Aeroflot's board fired longtime chief executive Valery Okulov on Thursday and replaced him with Vitaly Savelyev, a Sistema executive with no previous experience in the aviation sector. The shuffle caps a weeks-long power struggle at Russia's flagship airline amid growing dissatisfaction over Okulov's leadership, including criticism of the carrier's failed bid for Alitalia in 2007 and a decision not to pay a dividend for last year. Minority shareholder Alexander Lebedev reversed his earlier opposition to Okulov's removal Thursday, saying many of the board's complaints against Okulov were well-grounded. "I've suggested many things to Okulov, and I was not listened to," he told The Moscow Times. Leonid Dushatin, the Aeroflot board member representing Lebedev's National Reserve Corporation, which holds a 30 percent stake in the airline and is its largest minority shareholder, said Tuesday that ousting Okulov would be "madness." "It's like putting out a fire with kerosene. There is no reason to do this right now," he said. Lebedev said Thursday that he had heard that Savelyev was a "good manager" and that he would "recommend him." It was not immediately clear what changes might be made at the airline under Savelyev, 53, first vice president at billionaire Vladimir Yevtushenkov's Sistema holding and a former deputy prime minister. Savelyev made no public comments Thursday. The removal of Okulov, 57, who spent 12 years transforming the state-controlled carrier from a Soviet-era behemoth to an airline that could hold its own against global rivals, drew criticism from Aeroflot executives alarmed at the consequences of removing a popular chief executive in difficult economic times. "Nobody can be the boss forever, but the way [Okulov] is being treated is not right," said a senior Aeroflot executive who asked for anonymity in order to speak candidly. "He was a popular chief executive, the company has grown under him and to unceremoniously get rid of him like that looks bad to the ranks and to the rest of the world." Aviation analysts said it was too early to say whether the shuffle would have a negative impact on Aeroflot. "You have to remember that the airline's strategy is decided by the board of directors. The CEO is only responsible for carrying it out," said Oleg Panteleyev, a researcher at Aviaport, an aviation consultancy. "If he is an effective manager, it could be even be a plus for the company." Natalya Sorokina, an aviation analyst at UralSib, said a good deal of the airline's fortunes would depend on whether any major management shakeups would occur after Okulov's departure. "Some [executives] are likely to be removed, of course, but there are others with a great deal of technical experience who will not be so easy to replace, and they will likely remain," she said. She said Okulov's removal could be the result of disagreements with the Transportation Ministry about Aeroflot's direction, namely, whether to place a greater emphasis on the development of domestic or international service. Interfax reported late Thursday that Okulov had accepted the post of deputy transportation minister, a relatively low-profile post for a decorated pilot who headed a blue-chip company and has 34 years of experience in civil aviation. Earlier this month, Transportation Minister Igor Levitin offered Okulov a job as one of his six deputies. Okulov, however, said last week that he was dedicated to Aeroflot and that it was too early to discuss his departure. "[Aeroflot] is not just a transitional phase in my life. It is my life," he told Vedomosti. The management change comes at a turbulent time for Russia's airline industry, which has been battered by a drop in passenger traffic and falling share prices in the financial crisis. Last year, the Moscow city government and Russian Technologies said they would create an airline out of 10 smaller regional airlines that would eventually serve as an alternative to Aeroflot. The new airline is being overseen by Sergei Chemezov, who as head of Russian Technologies has sweeping powers over Russia's industrial complex, including weapons, heavy machinery and now aviation. Okulov, however, criticized the creation of the new carrier, calling it a "pyramid scheme." Okulov is the son-in-law of late President Boris Yeltsin

New U.S. Airline Cleared to Fly to Petersburg

Major airlines are slashing prices and grounding planes to remain profitable in the tough global economy. But a group of investors believe that the time is ripe to launch a new airline offering flights between New York and St. Petersburg. Baltia Air Lines has won approval from the U.S. Transportation Department to provide nonstop service between New York's John F. Kennedy International Airport and St. Petersburg's Pulkovo 2 Airport, and the flights will start this summer, the airline's chief executive, Igor Dmitrowsky, told The Moscow Times. The airline will initially offer the round-trip flights once a week on a Boeing 747, later expanding to three days per week and then five days per week, Dmitrowsky said. The eight-hour flight will be the first direct connection between St. Petersburg and any city in North America, which Dmitrowsky sees as an unfilled niche that will give the airline an advantage. Dmitrowsky said the economic downturn would also make Baltia competitive. "Frankly, these are the best of times for us. The fuel price has gone down dramatically, and the other costs are not so extreme," Dmitrowsky said by telephone from New York. "Can you imagine if we were living in an era where Pan Am was flourishing along with other major airlines with no debt?" he said. "We would have such a hard time breaking into the market and an even harder time staying afloat." Baltia intends to offer three-class service in its aircraft, which will feature a white fuselage with a red tail emblazoned with a white rooster, representing punctuality. The airlines currently offering direct flights to the United States -- Aeroflot, Delta Air Lines and American Airlines -- provide two-class service. A fourth carrier, United Airlines, will start flights to Russia next Sunday after postponing the Washington-Moscow route last year because of high fuel costs. Oil prices have dropped from a high of about $150 last summer to around $50 last week. But the financial crisis has since enveloped the global economy, discouraging business and leisure travel and forcing airlines to cut prices and capacity. Last week, United Airlines slashed prices to mark the start of the new daily flights between Washington's Dulles Airport and Moscow's Domodedovo Airport. Sample fares on the airline's web site show one-way tickets to Moscow via Dulles costing $119 from New York and $167 from Los Angeles. The tickets must be purchased by Thursday, and travel is between March 29 and April 30. Several other airlines dropped their prices below $500 for round-trip flights to Moscow last week, said Rick Seaney, chief executive of FareCompare.com. Seaney linked the price cuts to the crisis. "You have to understand that this is an absolutely crazy airfare environment," he said in a column on the ABC News web site. "The airlines are trying to fill up their planes, but people are procrastinating -- while others just aren't flying. ... So we get the yo-yo price game: When nobody's buying tickets, prices take a dive." He said he found American Airlines offering one round-trip fare of $205 from Baltimore to Moscow. Baltia's ticket costs will remain "along the lines of the current price structure on carriers with connecting services," Dmitrowsky said. But Baltia's web site is already promoting a host of discounts to students, seniors and youth. During the first month of service, all passengers will receive 25 percent off the ticket cost, and the first 300 passengers to book flights will receive a free ticket for future use. The date for Baltia's inaugural flight remains to be set, pending approval of its air certification documents from the Federal Aviation Authority, Dmitrowsky said. He said approval was expected within three months. The airline, based in Rego Park, New York, will start service with a single 747. It hopes to start nonstop flights between New York and Moscow, Kiev, Minsk and Riga next year. Dmitrowsky, a U.S. citizen born in Riga, founded a kefir company in 1979 and led it to a public offering in 1986. He has financed several aircraft and automotive projects, but his dream for nearly 15 years has been to launch Baltia. Baltia's shares, which trade on the "over-the-counter bulletin board" electronic system, closed up 20 percent at $0.04 on Friday after seeing a 52-week low of $0.01 on Nov. 12 and a high of $0.07 on March 24. Dmitrowsky faces an uphill battle. Airlines could lose more than $2.5 billion in 2009 after cargo volume dropped by 23 percent and passenger traffic fell by 5.6 percent in January, the International Air Transport Association said last week. Aviation industry insiders questioned the wisdom of United Airlines' plans to fly to Russia when they were announced last year, noting that flights between Moscow and the United States were rarely filled. United Airlines said at the time that planes on the Moscow flights would carry a combination of passengers and freight, making the route profitable. American Airlines started flights to Moscow from its home base in Chicago last year. Delta has been flying between Moscow and two U.S. cities, New York and Atlanta, for years.

China's Hainan Airlines Announces New Route To Ukraine

KIEV, Ukraine -- China's Hainan Airlines announced here Wednesday that it would launch a new route from Beijing to Ukraine's capital of Kiev aZhang Ning, the company's representative in Kiev, told a news briefing that passengers would be able to take a flight between the two cities on Tuesday and Saturday since Feb. 10, 2009."Flight frequency would be increased later," he said.Zhou Li, the Chinese ambassador to Ukraine, said that the opening of the new route will play a positive role in deepening mutual understanding and trust between the two countries and promote bilateral economic cooperation.The airline would use Airbus A330-200 aircraft, which has 222 seats with 36 business-class seats.t the beginning of next year.