Photo: Reuters
Photo: Reuters

India steps up Airbus probe in wake of global bribery settlement

  • ED is inspecting a payment of Rs1.42 billion linked to the 2006 purchase of 43 jets by Indian Airlines
  • The investigation is examining benefits to Airbus of Rs10 billion

Indian officials have intensified a probe into whether a $2.2 billion Airbus SE jetliner sale to a state-owned airline involved bribes, according to a person directly involved in the investigation.

India’s Enforcement Directorate is inspecting a payment of Rs1.42 billion ($20 million) linked to the 2006 purchase of 43 jets by Indian Airlines, as well as a commitment to provide aircraft-overhaul facilities that were never built, according to the person, who asked not to be named as the matter isn’t public.

All told, the investigation is examining benefits to Airbus of Rs10 billion, the person said. The Enforcement Directorate didn’t respond to two calls seeking comment, while a spokesman for Airbus declined to comment.

Airbus last month agreed to a $4 billion settlement for years of illegal payments to key decision makers in its efforts to win orders. Prosecutors from France, the UK and US initially studied deals in a total of 20 countries, India among them, though the settlement covered only 12, omitting the Asian nation.

The Indian Airlines order, for A320-series narrow-body planes, was placed in 2006, a year before the government merged the mainly domestic operator with flag-carrier Air India Ltd.

Among other things, the probe is looking at why the maintenance provision, worth about $175 million, wasn’t in the final agreement with Airbus, and whether their removal involved impropriety, the person said.

The Enforcement Directorate, part of India’s finance ministry, is seeking help from authorities in France, where Airbus is based, according to the person. It has also reached out to Singapore, where some bank accounts related to suspect transactions were traced.

Indian police began investigating the jet purchase in 2010 and sent a team to Europe to question executives.

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