PIA - Pakistan International Airlines (PK, Islamabad Quaid-e-Azam Int'l) will attempt to settle via diplomatic channels a dispute involving two of its B777-200(ER)s, one of which was “impounded on a court order” in Malaysia on January 15 due to a British court case over its lease, the airline said.

The case involves a USD14 million lease dispute, the airline admitted in a statement, adding that alternative arrangements had been made for passengers who had been due to fly on the seized aircraft from Kuala Lumpur Int'l back to Islamabad Quaid-e-Azam Int'l.

“A PIA aircraft has been held back by a local court in Malaysia taking a one-sided decision pertaining to a legal dispute between PIA and another party pending in a UK court,” PIA spokesman Abdullah H Khan said.

Khan elaborated in a later statement: “We were told that the plane has been impounded on a court order. PIA’s legal team will pursue it in the Malaysian court, and we hope we will resolve this issue as soon as possible.”

According to ch-aviation capacities, PIA currently connects the Pakistani and Malaysian capitals 1x weekly with a B777-200(ER). The ch-aviation fleets advanced module shows that its B777 fleet consists of six B777-200(ER)s, two of which are leased, as well as two owned B777-200(LR)s, and four B777-300(ER)s, one of which is leased.

Both of the leased -200(ER)s come from Irish lessor Peregrine Aviation, and according to a Kuala Lumpur High Court interim injunction seen by local media and news agencies, the plaintiff in the case is Peregrine Aviation Charlie Limited.

The two jets were initially leased to PIA in 2015 by leasing giant AerCap but were later part of a portfolio of 21 aircraft worth USD800 million that AerCap sold to Peregrine in 2018. US Securities and Exchange Commission documents show that AerCap holds a 9.5% stake in Peregrine Aviation.

The Malaysian court documents stipulated that whenever either of the two leased -200(ER)s landed in Kuala Lumpur, PIA would be restrained from moving it until a hearing takes place. Malaysia’s Ministry of Transport has since said that legal proceedings have been set for January 24.

ch-aviation analysis of Flightradar24 ADS-B data shows that B777-200(ER) AP-BMH (msn 32717) landed in the Malaysian capital on January 15, where it remains. The last time it was in Kuala Lumpur was on October 30. AP-BMG (msn 32716) has been in Karachi since December 20 and was last in Kuala Lumpur on December 11.

PIA, which reportedly shoulders more than USD4 billion in accumulated losses and is currently banned from flying to the European Union, said the situation was “unacceptable” and confirmed it had asked Pakistan’s government for support in resolving the matter.

PIA was not immediately available for comment.