Report: US Airlines Used Forensic Accountants On Gulf Carriers
A fascinating story in the Wall Street Journal shows how the three major U.S. airlines used the equivalent of private investigators to compile data that served as the foundation for their complaints against Gulf carrier subsidies.
In late January, American, Delta and United airlines delivered a 55-page white paper to the Obama administration stating that the United Arab Emirates and Qatar have provided $42 billion in government subsidies to Emirates, Etihad and Qatar airlines between 2004 and 2014. The subsidies, the domestic carriers said, skew the marketplace on lucrative international routes and create unfair competition, in violation of the Open Skies Agreement.
Delta actually began the process two years ago, the Journal said, when it hired forensic accountants to comb whatever public documents were available to determine the extent of the subsidies. Delta was later joined by American and United, which then morphed into the advocacy group Partnership for Open & Fair Skies.
The group realized it could track financial statements of the Middle East airlines through their offices in other countries, including Great Britain, Australia and Ireland, among others. Investigators told the WSJ they found 44 documents totaling 1,021 pages, which is how they came up with the $42 billion figure paid out to the Gulf airlines in subsidies – including about $17 billion for Etihad and $16 billion for Qatar Airways.
The Gulf airlines have denied the claim.
The U.S. airlines were expected to release all documents today.
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