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The Arab International Business Company, which is tied up with the UAE-based carrier Air Arabia, has told the Armenian National Interests Fund (ANIF) that its plans to launch international arbitration proceedings against the company and Armenia, NEWS.am reports, citing its sources.

"The reason is a financial dispute related to the Armenian national carrier Fly Arna, a joint-venture between Air Arabia and ANIF, which is moving closer to liquidation,” the media outlet said on Saturday.

The Armenian national carrier was registered in December 2021 and launched charter flights in July 2022. However, a year and a half later, in January 2024, the national carrier ceased its operations due to financial issues.

49% shares of the Armenian National Airlines CJSC, known as Fly Arna, are owned by ANIF and another 49% is owned by the International Business Company interconnected with Air Arabia.

The Corruption Prevention Commission and the State Oversight Service found alleged abuses in ANIF in 2022-2023. Later, the Investigative Committee initiated a criminal investigation into large-scale property damage and embezzlement as a result of abuse of office in ANIF.

In 2023, the International Monetary Fund (IMF) also reported accountability, transparency and corporate governance issues in ANIF.

At the 23 May 2024 cabinet meeting, the full management of the Armenian National Interests Fund’s shares was transferred to the State Property Management Committee to pave the way for the ANIF's dissolution.

In connection with the international proceedings initiated against Armenia, NEWS.am submitted an inquiry to the Office of Armenia’s Representative on International Legal Matters.

In response, the Department for Protection of Armenia’s Interests before International Arbitral Tribunals and Foreign Courts claimed that there was no information on Air Arabia’s arbitration case against Armenia.

NEWS.am also asked Air Arabia for comment on the matter, but has not received a response yet.