Qatar Airways sues Saudi-led air blockade for $5B claim

Qatar Airways is seeking at least $5 billion in compensation from Saudi Arabia, the United Arab Emirates, Egypt, and Bahrain for blocking it from their airspace. 

"The arbitrations seek redress for the blockading states' actions to remove Qatar Airways from their markets and to forbid the airline from flying over their airspace," the airline said in a statement on Wednesday. 

"These measures specifically targeted Qatar Airways, with the objective of shuttering Qatar Airways' local operations, destroying the value of the airline's investments and causing widespread damage to Qatar Airways' global network of operations," it said.

The four states accuse Doha of supporting terrorist groups, an accusation vociferously denied by Qatar, which describes the Saudi-led embargo as a violation of international law.

Representatives of the four Arab states could not be immediately reached for comment.

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UN favours Qatar

The International Court of Justice last week ruled Qatar could challenge the airspace restrictions imposed by the four countries before the UN's International Civil Aviation Organization (ICAO).

Saudi Arabia and the United Arab Emirates said they respected the decision but denied the ruling dealt with the merits of the case.

The UAE said it would "put its legal case to ICAO supporting the right to close its airspace to Qatari aircraft."

The ICAO in 2018 ruled it had the jurisdiction to handle the dispute brought by Qatar, which accused its neighbours of violating a convention that regulates the free passage of its passenger planes through foreign airspace.

But Doha's rivals disagreed, saying the ICAO was not the right body to judge in the dispute and that its decision to do so was "manifestly flawed and in violation of fundamental principles of due process and the right to be heard."

They then unsuccessfully asked the ICJ to declare the aviation body's ruling "null and void and without effect."

Investment arbitrations

The airline is seeking the damages through four investment arbitrations under three treaties, including the Arab Investment Agreement, it said in a statement.

"After more than three years of efforts to resolve the crisis amicably through dialogue yielded no results, we have taken the decision to issue Notices of Arbitration and pursue all legal remedies to protect our rights and secure full compensation for the violations," said the airline's chief executive, Akbar al Baker, according to the statement.

"By imposing the measures against Qatar Airways, the blockading states have violated their obligations under the agreements, including by expropriating and failing to adequately protect and secure Qatar Airways investments."

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Serious damage to global operations

Because of Qatar's limited airspace and its clash with the Arab bloc, the airline has had to rely on flying over Iran. 

That has meant longer costlier routes that require more fuel.

Qatar Airways is the second-largest airline in the Middle East after the Dubai-based Emirates, operating a modern fleet of 250 aircraft.

Since the start of the air embargo, the national carrier has posted losses of hundreds of millions of dollars.

Saudi Arabia, the United Arab Emirates, Bahrain, and Egypt severed diplomatic relations with Qatar and imposed a land, sea, and air blockade in 2017.

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