PRESIDENT Arroyo yesterday signed into law the Civil Aviation Authority Act of the Philippines or R.A. 9497, which creates an independent body that would regulate air transportation and services in the country.

With the law’s passage, the Philippine government hopes that the US Federal Aviation Authority (FAA) would return the Philippines to Category 1, after downgrading it to Category 2 last January for failure to meet aviation safety standards.

Under R.A. 9497, the Air Transportation Office will be abolished and replaced by the CAA, which shall have quasi-judicial and quasi-legislative powers. The CAA would be attached to the transportation department.

In her message before signing the bill into law, Arroyo said flights would now be safer and there will no longer be any hindrance to increasing tourism and investments that would create jobs.

Under the new law, the CAA will enjoy fiscal autonomy and its personnel would be exempted from the Salary Standardization Law.

The CAA is allowed to keep its revenue collection of about P3 billion annually to be used for the improvement of its facilities and the training of personnel.

Transportation Secretary Leandro Mendoza said government will ask for a re-audit by the FAA in June so that the downgrade would be reversed.

Tourism Secretary Joseph Ace Durano said once the Philippines is upgraded to Category 1, Philippine Airlines could expand its operations in the US.

"For this year we have no problem because the 54 flights per week from the US to the Philippines totals about 900,000 seats per year and our target arrivals from the US this year is around 650,000," Durano said.

He said the country must be upgraded not later than this year. Otherwise, PAL’s expansion would be deterred.

The US aviation watchdog in its January 8 report included the Philippines in a list of 21 countries that failed to "provide safety oversight of its air carrier operators in accordance with the minimum safety oversight standards established by the ICAO."

A Category 2 rating means the country lacks regulations necessary to support the certification and oversight of air carriers in accordance with minimum international standards.

The country also lacks technical expertise, resources and organization to license air operations, does not have adequately trained and qualified technical personnel, and does not provide adequate inspector guidance to ensure enforcement of minimum standards.

Aviation systems of a country placed in Category 2 will be subjected to heightened FAA surveillance and will not be allowed to expand or change its services in the United States. – Regina Bengco