Airlines Rely on Third Parties to Pay Afghan Overflight Fees, Raising Legal and Financial Concerns

Airlines have increasingly turned to third-party intermediaries to process payments to Afghan authorities as more planes use the country’s airspace, a development that has heightened the risk of legal disputes and potential money laundering, according to pilots, aviation executives, and lawyers.

Over the past year, more airlines have begun flying over Afghanistan, driven by the expansion of conflict in the Middle East and a shift in aviation regulators' stance toward the use of Afghan airspace. The Taliban has publicly stated that this increased traffic has led to a surge in overflight payments—fees that countries typically charge airlines for providing navigation services in their airspace.

However, making these payments to the Taliban-run aviation authority is complicated by the freezing of Afghanistan’s government bank accounts overseas and Western sanctions imposed on Taliban leaders. The complex nature of these transactions, including the reliance on intermediaries and the lack of formal invoicing, is being detailed publicly for the first time.

Before the Taliban took power in 2021, the International Air Transport Association (IATA) collected overflight fees on behalf of Afghanistan’s aviation authority. IATA told Reuters that it ceased this service in September 2021, leaving millions of dollars in charges collected for the previous Afghan government frozen in its accounts.

Since then, airlines and private jet operators have turned to third-party intermediaries, known as trip support firms, to process payments to the Afghanistan Civil Aviation Authority (ACAA). According to six individuals familiar with the process, including pilots, airline officials, and payment specialists, some of these third-party permit firms use additional intermediaries—primarily based in the United Arab Emirates—to facilitate transactions.

This additional layer of intermediaries has further complicated the process, and lawyers and sanctions experts warn that it could pose legal and financial risks for the aviation industry. One of the key challenges is the lack of formal invoicing from Afghan authorities. Jon Braid, owner of the British-based trip support company Jet Team, said that many Western trip support firms have never received an invoice for overflight fees, making it difficult to process payments. “The biggest difficulty is basically finding a way to pay the bills … no one sent us a bill yet,” Braid said.

The Taliban did not respond to requests for comment.

Flight tracking data has shown that major airlines that have started using Afghan airspace over the past year include Lufthansa, Air Baltic, TUI, KLM, British Airways, Singapore Airlines, China Airlines, EVA Air, Air India, and Vietnam Airlines.

In response to inquiries from Reuters, a Lufthansa spokesperson stated that the airline was in full compliance with all relevant sanctions but declined to provide further details on how it handled payments to Afghanistan. Other airlines either declined to comment or did not respond to questions regarding their overflight payments. Reuters found no indication of any sanctions violations or wrongdoing by airlines or financial intermediaries. The U.S. Treasury, in 2022, granted expanded authorization for financial transactions related to air navigation services, allowing engagement with Afghan institutions, including those under Taliban control.

Afghanistan charges a flat fee of $700 for aircraft to transit its airspace. Based on FlightRadar24 data, the country should have earned approximately $6 million per month in October, November, and December from these fees.

The process of paying Afghan aviation authorities has increased the risk of illicit financial flows and could lead to legal disputes if payments fail to reach the intended recipient, according to three lawyers and sanctions specialists who spoke to Reuters. Industry sources note that some countries lack the administrative resources to issue invoices and collect payments, even after granting flight permits.

Reuters reached out to more than a dozen financial aviation intermediaries in the UAE, a key hub for the industry. Some acknowledged assisting private jets and commercial airlines in obtaining permits for Afghanistan but declined to be named or disclose the identities of their clients or provide details on how, or if, payments were made.

One major company that arranges permits for flights through Afghan airspace told Reuters that it can take between six months to a year for Afghanistan’s aviation authority to issue invoices to airlines, leading to significant outstanding balances. Others in the industry have opted not to arrange overflight permits at all to avoid potential banking or legal complications.

Last year, the UAE was removed from the Financial Action Task Force’s (FATF) grey list of countries at high risk for illicit money flows. However, the European Union continues to classify the UAE as a high-risk jurisdiction. A spokesperson for the UAE government told Reuters that “since its removal from the FATF grey list, the UAE has further strengthened its regulatory framework, ensuring strict oversight across all sectors.”

Reuters also asked the Taliban to disclose how much it has earned in overflight fees but did not receive a response.

By fLEXI tEAM