Air transport operator AS “airBaltic” has secured definitive written court orders allowing the carrier to maintain key operational contracts, pay employee wages, and honor existing ticket obligations during its ongoing Chapter 11 restructuring process.
Operational Continuity Under Chapter 11
- While a hearing regarding the remaining €35 million financing tranche was moved to October 19, the airline confirmed that six operational day-to-day motions faced zero creditor objections.
- The carrier retains full authority to process customer refunds, recognize previously sold tickets, and honor outstanding gift cards and loyalty program liabilities.
Court Approvals Shielding Vendor and Supplier Contracts
The judicial orders establish a clear legal framework designed to protect day-to-day operations while financial restructuring proceeds. The court formally confirmed that AS “airBaltic” is permitted to maintain vital aviation supply agreements, fulfill current obligations, and execute new contracts necessary for business continuity. Creditor representatives will receive regular reports detailing the largest disbursements made under these maintained vendor agreements.
Furthermore, the airline received authorization to settle specific claims from foreign suppliers and trade creditors that arose prior to the restructuring filing. Maintaining these vendor relationships ensures that flight operations face minimal disruption across the carrier’s route network. The court also validated the uninterrupted continuation of all existing insurance policies, granting the company the right to procure new coverage as required.
Protecting Passenger Programs and Employee Compensation
Under the finalized directives, passenger-facing systems remain fully insulated from the legal proceedings. AS “airBaltic” is explicitly authorized to continue customer service operations, honor previously issued tickets, process passenger refunds, and fulfill obligations linked to gift cards and frequent flyer programs.
On the labor front, the court confirmed that the airline must continue meeting its payroll obligations, employee benefits, and social program commitments. Pre-petition wages and worker benefits remain fully protected. However, the court stipulated that any material modifications to existing salary structures or bonus systems require prior consultation and approval from creditor representatives.
| Operational Area | Court Authorization Status | Key Conditions |
|---|---|---|
| Aviation & Supplier Contracts | Approved (Final Order) | Regular reporting of major disbursements to creditor representatives. |
| Insurance Policies | Approved (Final Order) | Uninterrupted coverage maintenance and right to secure new policies. |
| Customer Programs & Ticketing | Approved (Final Order) | Full recognition of prior ticket sales, refunds, and loyalty points. |
| Payroll & Labor Obligations | Approved (Final Order) | Prior consent required for material changes to bonus or salary schemes. |
| Financing Tranche (€35M) | Deferred | Hearing rescheduled for October 19. |
Tax Compliance and Remaining Financing Milestones
Regulatory and fiscal compliance measures also received court backing. The airline secured authorization to continue routine tax and fee remittances, including the servicing of existing agreements with the Latvian tax authority. Management retains the flexibility to negotiate new tax settlement frameworks during the restructuring phase if operational liquidity dictates such a move.
Attention now shifts to the pending October 19 court date, where the remaining €35 million financing tranche will be formally reviewed. With six initial operational motions clearing without creditor pushback, the carrier enters the next phase of its financial reorganization backed by clear judicial guidelines.
