Why Virgin Atlantic Went To Court In Cyprus To Keep Cobalt Alive

the weirder thing was if Cobalt were already in financial distress to begin with, why not fully monetize their slot holding and convert from a lease to a full sale to VS , and at least get a good chunk of cash that would keep them alive for a short while ?

now VS is forced to scramble in court while getting things done after going into administration is always a major PITA, because everyone now has a say regarding who gets what and why dealing with VS has priority over others etc.

And knowing who owns 49% of VS, if VS is forced to suspend routes as a result of the delay, it would be anything but one that impacts the JV.

Great summary, James. And given the opaque and generally tawdry nature of legal proceedings in Cyprus one imagines there will be much back-room dealing and exciting "friendly" payouts on the table.

I doubt Virgin will do anything for Cobalt. This also shows just how globalized the industry is: one of the reasons Cobalt failed was the new restrictions on foreign investments in China, where its main investors were from. This then snowballed to affect Cyprus, Great Britain and who know who else.
It is a shame though, since Cobalt was a nice airline and, at least not on surface, nowhere near as corrupt as the old Cyprus Airways.

didn't know you are a lawyer! good to know! my guess is they got the slot back, as you said.

Cobalt are from the Greek side.. they would NOT be in a court with Turkish documents. 0% chance of that.

@ Richard - I did not want to make any presumptions about Nicosia!

Henry - you are very confused

VS already owned the LHR slot.

Cobalt therefore couldn’t monetarise it in any way shape or form or even sell it back to the people who already owned it ie VS.

It was also a slot VS weren’t using hence the lease. It won’t affect other VS routes or operations other than they now need to decide to use the slot themselves (and if so on what route) or lease it to another operator.

I think you meant Azur Air, not Azul Air (Azul Linhas Aereas is an airline based in Brazil).

There is nothing unique about Heathrow's "use it or lose it" regulations. It is the standard 80/20 regulation in place at all slot controlled airports and draws from IATA WSG.

Although Cobalt started off as a low cost carrier, a few management changes later and they became a fuller service airline with plans to expand into long haul.

As for the London traffic, flying to three airports is not at all unsurprising for a Cypriot airline! Between the thousands of students, ex pats and tourists, those routes would have all easily been filled. There are Cypriot communities all across/around London as well as the rest of the U.K. BA has now added a third flight from Heathrow to Larnaca, in addition to the Gatwick routes to both Larnaca and Paphos. They are easy routes to fill and you will find many people paying the extortionate £700+ fares to fly Business.

The relationship between Virgin and Cobalt may go back to the original Cyprus Airways days when they had codeshare agreements across the Atlantic. That said, the vast majority of Cobalt’s foreign investment was Chinese.

The transcript will be in Greek (the official language of the legally recognised state of Cyprus) and English. The courts follow English law, with Cyprus having been part of the British Empire in the past!

I'm sorry, I may be confused but isn't Azul Air Brazilian? Also, if I'm not wrong, they're doing pretty well financially.

Why would virgin lease the slot in the first place ?

Nicosia lies within the only internationally recognised part of Cyprus, and a contract from the occupied part of it, if such a thing exists, would only be enforceable by the occupier, Turkey. Plus, there is not such a thing as a Cyprus Greek, that's like saying contracts in Mexico are written in Mexican a Spanish... for someone who travels as much as you do, you show a very poor knowledge of global affairs.

@Neil.. I was thinking the same thing. I was like... When did Azul collapse.. lol. Still needs editing in the blog post.

Scandito - there IS such a thing as a Greek Cypriot. You may not like the term, but it certainly exists (and all my southern Cypriot friends use the term to describe themselves).

Mexican Spanish is also a thing... Just like American English is.

For someone as arrogant as yourself, you have a very poor grasp on global affairs.

@ Scanditino - the vernacular language the majority of people in Cyprus speak is Cypriot Greek.

Jamie - it’s quite common to lease a slot you own to another airline if you have no current plans to use it because it doesn’t fit your schedule - you’ll be getting money for it without the hassle of flying passengers!

If VS didn’t either lease it out for use or use it themselves they would soon fall foul of the 80-20 rule and have it taken away from them and they would lose a valuable asset (and be the laughing stock of the airline world for giving up a LHR slot pair for free).

As I said earlier VS will be looking to use the slot themselves or lease it but they are on a tight timetable because of the 80-20 rule. They could even fly some ghost flights just to maintain the slot pairs which BA have been know to do in th past.

@Phillip: You're right. Cyprus was an English territory, which explains why (shockingly enough for that region) it is right-hand-drive.

@James: Azur Air (the Russian one) is very much alive and kicking. It is its German subsidiary that shut down.

It would definitely be in Greek. There’s no way an official document in Cyprus, rather than The Part Of Cyprus Not Under The Effective Control Of The Cypriot Government, would be in Turkish.

@VT-CIE: No it isn’t. There are parts that are British sovereign bases but it is its own sovereign nation.

Some time on Wikipedia might help.

Callum, I had meant to say there is no such a thing as a written Cypriot Greek LANGUAGE. Of course Greeks from Cyprus are different from Greeks from Greece and yes, they might speak differently but they still write in the SAME language. I speak Greek, I've been to Cyprus AND my mother tongue is Spanish, so let me enlighten you and tell you that contracts are not written in Mexican, Chilean, Argentinan, etc - Spanish, they're only written in SPANISH, period, in the same way as contracts in Greek are written in only one standard Greek language, unlike for example contracts written in Portuguese from Brazil or Portugal. You really picked the wrong guy to argue over a typo... Your monolingualism has a solution though, it is called education!!!!

I sometimes wonder why grown ups choose to behave like high school students...

There are two official languages in the Republic of Cyprus - Greek and Turkish. All/most of government documents are in those two languages, so are passports (plus English) and so were Cypriot pounds before they were replaced by Euro. It is unlikely though that a court ruling on this matter will be in Greek AND Turkish. Most likely in Greek and English.

Those arguing about the existence of the Cypriot Greek language, should look up the difference between a language and a vernacular. Yes, Greek speaking Cypriots speak differently than Greeks proper. No, they don't speak a different language.

Cypriot is not a language but a dialect of Greek influenced by many of the past occupiers of the island... Romans, Phoenicians, Persians, Ottomans, British...

The language used is Greek.

Official documents, such as passports and ID cards, are in Greek, Turkish and English!

Why don't virgin themselves operate the slots and fly to LCA ?

Why does Virgin not utilise the slot itself and provide flight to Cy ..... ?

@ Sue Salter - Virgin can use their slot from Heathrow to fly anywhere (it's not a specific London to Larnaca requirement) so will probably use the slot to fly to a more profitable destination like perhaps increasing frequency to New York.