Air New Zealand told permits weren't needed for engine exports to Saudi navy –

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Air New Zealand, which was heavily criticised last month over a contract with the Saudi Arabian military, has been told it did not need permits to export the engines it was repairing.

The Ministry of Foreign Affairs and Trade (MFAT) confirmed to the airline on Tuesday that permits were not required for the export of the GE LM2500 engines its subsidiary was repairing for the Royal Saudi Navy.

The Saudi navy had been involved in a blockade that prevented food and supplies reaching its neighbour, war-torn Yemen. The United Nations has called the situation in Yemen the world’s worst ongoing humanitarian disaster.

Last month, after the revelations by TVNZ about the subsidiary Air New Zealand Gas Turbines, the airline said it had repaired engines for eight different navies over the past decade.

* Air New Zealand confirms it has done work for eight different navies
* Former Air NZ boss Chris Luxon says military contract process was ‘a mistake’
* Call for Air NZ executives to reveal other military deals after ‘not acceptable’ Saudi contract

Prime Minister Jacinda Ardern asked MFAT to look into the issue

On Tuesday, the airline’s chairwoman, Dame Therese Walsh, said it had been given similar advice about the permits from a Queen’s counsel looking into the licensing requirements for the engines.

Air New Zealand was heavily criticised last month over a contract with the Saudi Arabian military.

David White/Stuff

Air New Zealand was heavily criticised last month over a contract with the Saudi Arabian military.

“The legal advice we received from Mike Heron, QC, is that the export of the two engines to Germany for the Royal Saudi Navy did not require an export permit under the Customs Act, nor did it require a notification to the Secretary of Foreign Affairs and Trade,” Walsh wrote in a statement.

“The advice is that new notification requirements introduced in late 2020 do not apply to contracts entered into before September 2020 (when the notification requirement was expanded for certain military related exports). The contract for this Royal Saudi Navy work was in May 2019.”

An internal review was due to be finished shortly.

In a statement, Air New Zealand chief executive Greg Foran said: “In late February we took immediate steps to ensure all future work of a military or government nature is escalated to executive level for review, including ethical considerations, and approval before a contract can proceed.

“We will also work with relevant governmental agencies to ensure our understanding of issues for differing jurisdictions is kept up to date.”

Last month, majority government-owned Air New Zealand apologised to MPs and the public and terminated the $3 million Saudi contract.

Its gas turbines business was one of a handful of facilities in the world licensed to repair a certain type of engine used on large vessels.

Over the past 10 years, Air New Zealand has also done engine repair work for navies in Australia, Canada, New Zealand, Norway, Taiwan, Turkey and the United States.