Press Release, from Head Office, Peau Vava'’u Limited. 08 September 2004.

In a hearing in an open court on 6th September 2004 to consider a review of the injunction granted by the Court on 17 August, 2004 quashing the sole operator license of Peau Vava'u Limited, the Supreme Court of Tonga ordered to rescind the injunction granted by it on 17 August 2004 and this to take effect from Friday 10th September 2004.

The Company Secretary of Peau Vava...’u Limited stated "since the injuction was ordered over three weeks ago, there has been a massive build-up of misinformation regarding how Peau Vava'u Limited acquired the sole operator license and the role of His Royal Highness Crown Prince Tupouto'a in the granting of this license. The Court decision today has clearly vindicated the process and procedure that was followed by Peau Vava'u Limited to obtain the sole operator license."

Because of the injunction ruling of 17 August 2004 to quash the sole operator license of Peau Vava'u Limited, the general perception of the public was that the ruling was based on unlawful policy and procedures followed by Peau Vava'u Limited to acquire the license. However, the ruling of 17 August (as has been proven by the rescission of 8 September 2004), was based on the fact that Government at this hearing did not make a position whatsoever to either protect its own interests or that of Peau Vava'u Limited to which they had just granted the sole operator license to.

Arising from the injunction ruling, a grave injustice was delivered to Peau Vava...’u Limited and its Chairman forcing Peau Vava'u Limited to submit to the Supreme Court the correct representation of the events that led to the granting of the sole operator license. It was this submission of Peau Vava'u Limited that the ruling of 8 September 2004 to rescind the injunction was based on.

Peau Vava'u Limited's submission to the Supreme Court is summarized as follows:

1. His Royal Highness was requested by Government to establish the domestic air services to fill the void created by the demise of Royal Tongan Airlines because Government had no alternatives at the time;

2. Significant financial resources have been invested in Peau Vava'u Limited;

3. Significant management time from High Royal Highness' existing Group of Companies have been invested to ensure the stability of the domestic air services operation;

4. The single operator policy was recommended by ICAO and other airline consultants because they recognized that the physical size of the market in Tonga was simply to small to sustain more than one operator;

5. The Government of Tonga did not want a repeat of what happened to Royal Tongan to deprive people of air services;

6. Peau Vava'u Limited had submitted a proposal for a single operator license fulfilling the criteria for assessment;

7. Fly Niu although one of the two invited candidates for assessment for the single operator license, had not submitted a proposal/application for it;

8. That Government had granted Peau Vava'u Limited the single operator license for a period of two years.