”ECA has never been supported by the Croatian administration even though we have linked the islands and the coast without the use of one kuna of state money,” says D. Thiele, the representative of German investors who were shoved from pillar to post in an attempt to get the seaplane project off the ground again.
As Sasa Paparella/Poslovni Dnevnik writes on the 4th of April, 2019, two and a half years after inspectors of the Croatian Civil Aviation Agency (HACZ) grounded all four of ECA’s airplanes for allegedly endangering flight safety back in August 2016, European Coastal Airlines (ECA) and the project of returning seaplanes to the Adriatic sea has now definitely collapsed. Soon, the dismantling of twelve airports on the water will begin, this encompasses all of the pontoons designed to receive ECA’s airplanes set up at sea ports from Lošinj to Hvar, to Lastovo.
It’s difficult to find someone willing to return the seaplanes to the Adriatic. German investors, who started the project all the way back in 2001, are extremely dissatisfied with the behaviour of the Croatian authorities.
“The ECA project has never been really supported by the Croatian administration. Investors from Germany and Malaysia have invested 25 million euro in the project to set up the transport infrastructure which is necessary for seaplane traffic. They did so without the use of one kuna from the state, and without an HBOR loan, even though we did apply for them. We have linked the islands and the coast and we employed 150 people,” recalls Dietmar Thiele, executive director of OTAGO Beteiligungs GmbH, representing German investors and their Chinese partners from the Shanghai Jet star company, who were more than willing to invest in the reconstruction of seaplane traffic on the Adriatic.
Despite the total and utter lack of support from the Croatia authorities, and sometimes allegedly faced with the opposition of local and port authorities, the German investors were still able to launch the project and get all of the necessary permits to start the operations of the first hydro carrier in Europe.
“Regular lines began in 2014, and in August 2016, ECA performed 60 flights per day connecting 11 destinations, it transported up to 600 passengers per day and earned a daily income of up to 40,000 euro, as planned. However, the administrative overhaul of ECA prevented further business, resulting in enormous costs, which stalled any further funding of the project. HACZ grounded the seaplanes due to, as was noted, those established deficiencies. The unreasonableness and the illegality of this grounding has already been confirmed by four court witnesses, and this has lead us to a court dispute,” Thiele stated.
To the contradictions that ECA was facing huge debts and would have otherwise failed because the model was not market-friendly, the response is as follows: “The business plan was based on achieving the project’s profitability after five years, with seven seaplanes and 23 seaports,” they added that every airline in the world plans for losses during their very first years of doing business, as they plan to cover said losses with the company’s capital.
He added that the new Chinese investors were ready for the further financing of assets and new loans, the debts remained with the German investors, and the fleet would have been financed through leasing. Although the seaplanes have not flown since 2016, the project didn’t fall away into the abyss immediately, but has been attempting a new beginning – some co-owners of ECA are opening a prebankruptcy process and are finding new investors from China’s Jetstar.
The judge gave them two chances.
The Chinese wrote their intention to confirm that they want to invest 15 million euro in the project’s renewal, to open a new company and to transfer the concession to twelve certified airports. The Chinese also sent that letter to the judge at the Commercial Court in Split, Velimir Vuković, who gave them an additional four months to complete the planned investment, but the executive powers failed to show any understanding.
In June 2018, the investors sent an official letter of intent to the Minister of Maritime Affairs, Transport and Infrastructure, Oleg Butković, from whom they received no answer. In August 2018, they asked for an answer once again. However, in communication with the then State Secretary for Maritime Affairs, the receipt of the letter was confirmed, but any official response has remained entirely absent. At the end of the prescribed four month period, Judge Vuković was forced to open bankruptcy proceedings in September 2018, resulting in the collapse of all of the existing concessions, and the investors naturally withdrew.
Much like with answering the letters from the investors, Minister Butković’s office failed to answer why investors didn’t get an answer when asked by Poslovni Dnevnik to comment on the matter. Instead, the portal was told: “The Ministry fully supported the project of the introduction of seaplanes and regulated the legislative framework by amending existing laws in the field of maritime and air transport, as well as the adoption of the Ordinance on water airports. Representatives of the Ministry assisted the investor in the realisation of the project,” the letter went on to state all of the apparent ways in which the aforementioned ministry helped. This letter, which came much, much too late, didn’t do much for the exhausted would-have-been investors, of course.
However, not entirely beaten, the foreign investors have initiated several litigation claims for damages and lawsuits against HACZ. They informed the German Embassy of everything, as well as the Chinese diplomacy.
The collapse of the seaplane company began with a real tragedy back in June 2015 when, as the German investors themselves say, “two irresponsible Croatian ECA pilots, without having a license to fly that type of airplane, illegally took a small seaplane from the Lake company to four places, and because of their inability and their failure to comply with the flight rules, caused a plane crash resulting in two dead and one seriously injured pilot. Although two persons were killed in the accident, the State Attorney’s Office in Split hasn’t opened an investigation into the matter for more than 3.5 years.”
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