Nepal’s aviation reform advances: two bills to split CAAN sent to parliamentary committee

KATHMANDU: In a significant step toward enhancing aviation safety and aligning with international standards, Nepal’s House of Representatives has forwarded two critical bills to a parliamentary committee for detailed discussion. The Nepal Air Service Authority Bill, 2081, and the Civil Aviation Authority of Nepal Bill, 2081, aim to restructure the Civil Aviation Authority of Nepal (CAAN) by separating its dual roles as a regulator and service provider. This move, long advocated by global aviation bodies, is seen as vital for improving Nepal’s aviation safety record and potentially lifting the European Union’s air safety ban on Nepali airlines.

The bills were presented during a session of the House of Representatives on Sunday, following years of delays due to political turmoil and internal opposition. The proposed legislation seeks to address a key issue highlighted by the International Civil Aviation Organization (ICAO): CAAN’s conflicting responsibilities as both a regulator and operator of aviation services, which creates a conflict of interest and weakens oversight.

By establishing two distinct entities—one for regulatory oversight and another for service provision, including air traffic management and airport operations—the bills aim to enhance accountability and safety in Nepal’s aviation sector.

The decision to send the bills to a parliamentary committee for clause-by-clause deliberation reflects Nepal’s commitment to thorough legislative review. This step follows their introduction in February 2025 by Minister for Culture, Tourism, and Civil Aviation Badri Prasad Pandey, who emphasized the need to align Nepal’s aviation framework with global standards.

The bills have been under discussion for over a decade, with earlier drafts stalled by bureaucratic hurdles and resistance from CAAN’s trade unions. The current push comes amid renewed pressure to address Nepal’s inclusion on the EU Air Safety List, imposed in 2013 after a series of air crashes raised concerns about safety standards.

The proposed Nepal Air Service Authority Bill will govern the service provider responsible for managing air services and airports, while the Civil Aviation Authority of Nepal Bill will establish an independent regulatory body led by a director general appointed for a four-year term.

The regulatory body will be overseen by a five-member board, chaired by the tourism minister and including experts with at least ten years of aviation experience. These reforms are expected to strengthen oversight, improve operational efficiency, and boost investor confidence in Nepal’s aviation sector, a critical component of the country’s tourism industry.

Nepal’s aviation reforms have garnered international attention, with organizations like the Asian Development Bank (ADB) supporting earlier drafts of the legislation. The urgency to pass these bills is heightened by Nepal’s commitments at global forums, including the ICAO Assembly, to meet international safety standards. The separation of CAAN’s roles is also seen as a prerequisite for opening Nepal’s airports to private investment, which could modernize infrastructure and enhance connectivity.

As the bills move to the parliamentary committee, stakeholders are optimistic about their potential to transform Nepal’s aviation landscape. The successful passage of these laws could pave the way for Nepali airlines to regain access to European skies, boosting the country’s reputation as a safe and reliable aviation hub.

For now, the focus remains on ensuring robust discussions in the committee to address any lingering concerns and finalize the legislation, marking a pivotal moment for Nepal’s aviation sector and its aspirations for global integration.