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Indochina Airlines has asked the prime minister to approve an extension on the decision to revoke its license.

A one-year extension could help restore Indochina Airlines’ service

News of the request came from Lai Xuan Thanh, Deputy Head of the Civil Aviation Administration of Vietnam (CAAV), who said that the airline sent the same proposal to the agency.

The Ministry of Transport is in the process of completing procedures to withdraw Indochina Airlines’ license, but the carrier asked for the one-year extension in order to have sufficient time for financial restructuring, Thanh added.

Thanh noted that he did not have confidence in the feasibility of the carrier’s operation plan, but the CAAV has once again granted an extension of their license so that they could continue service.

The website Vneconomy cited Vo Huy Cuong, Head of the CAAV’s Air Transportation Department as saying that, if the license was revoked, Indochina Airlines would have no chance of negotiating with potential investors to gain additional capital for resumption of its service. The carrier’s lenders would also face difficulties in collecting their debts.

The airline must settle its debts and submit a complete restructuring plan before it would be allowed to resume regular operation in late 2011.

Indochina Airlines, owned by musician Ha Dung, was licensed in May 2008, and began operations in November of the same year. Due to financial problems, the airline was forced to suspend its flights in late 2009.