Malaysia Airlines MH370: Questions over who will fund search

Fifty-fifty, a Malaysian official said of how his country and Australia will split the bill for the increasingly massive search for the missing jetliner. Not so fast, Canberra responded.

Malaysian and Australian officials discussed cost-sharing this week in the Australian capital, but Australian Transport Minister Warren Truss declined to say Friday whether the country was even considering an even split of the bill for a search that will take months, if not years, and cost tens of millions of dollars at a minimum.

"I don't want to give any indication as to where it's likely to end up," Truss told The Associated Press. "We are talking about this with the Malaysians and other countries who have got a key interest."

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The government expects to spend $84 million USon the search by July 2015. But the actual cost to Australia will depend on how quickly the plane can be found and how much other countries are willing to contribute. And a legal expert said Australia's obligations are murky because of the unprecedented nature of the plane's disappearance.

Malaysia Airlines Flight 370 veered off course during a flight from Kuala Lumpur to Beijing on March 8 and is believed to have crashed into the Indian Ocean far off the west Australian coast. The search area has changed several times, but no sign of the aircraft, or the 239 people aboard, has been found.

Countries are continuing to negotiate on how to fund the next phase of the sonar search of almost 56,000 square kilometres of seabed beneath water up to 7 kilometresdeep.

Countries involved in the search, including Malaysia, Australia, the United States, China, Japan, Britain, South Korea and New Zealand, have carried their own costs to date. But Malaysian government lawmaker Jailani Johari, chairman of Malaysia's Liaison, Communication and Media Committee, told reporters in Kuala Lumpur this week that future costs "will be shared 50-50" between Malaysia and Australia.

The job is much more difficult than another complex and challenging search it is often compared to: the hunt for Air France Flight 447. Though debris from that aircraft was found within days, it took two years to recover the black boxes from the plane, which crashed off the coast of Brazil in 2009, killing 228 people.

The French government, the airline and aircraft manufacturer Airbus paid for the vast majority of the underwater search and recovery efforts.

Funding arrangements 'quite complex'

Brazil, like Australia, had search and rescue responsibility for the crash site under the UN Convention on International Civil Aviation, also known as the Chicago Convention. But its costs were relatively limited.

Truss declined to say whether the Flight 447 precedent featured in the current funding negotiations, but said the question of who should pay for what under the Chicago Convention was "quite complex."

"We've indicated our willingness to be a part of the funding arrangements ... and we're just talking about those things," Truss said.

He said Malaysia had responsibilities as the country where the state-owned airline is registered, while Australia had responsibilities toward aircraft in its air space and search and rescue zone. Complicating matters is the fact that the search is in Australia's zone only because the aircraft went dramatically off course.

"In this case we have this wild card," Rothwell said. "This aircraft was not in any way expected to be within Australia's search and rescue region, so that is a dynamic which is extraordinary."

Rothwell said there are also questions about how long Australia is legally required to maintain the search.

"Australia, I think, would be within its rights to make the observation that it's quite clear that the search and rescue phase has passed. We are now clearly in a recovery or salvage phase and to that end, Australia's obligations under the relevant aspects of the Chicago Convention are not quite clear," he said.

The Australian government has repeatedly said it owes it to families of the passengers and crew aboard Flight 370 to do all it can to solve the mystery of the airliner's disappearance. It has placed no time limit on how long the search will continue.

A Chinese survey ship is mapping the ocean floor ahead of a sonar search for wreckage by specialist deep-sea private contractors. That search is expected to begin in August and take eight to 12 months.

Truss said China, the homeland of most of the missing passengers, was continuing to carry its own costs for the survey work. But China was under no legal obligation to help pay the multimillion-dollar bill for the private contractors, he said.

Families receive initial payments

Meanwhile, Malaysia Airlines has begun giving out $50,000in advance insurance payments to families of people aboard the plane, but many Chinese relatives have indicated they'll reject it. There were 153 Chinese passengers aboard the jet.

Six Malaysian and one Chinese family have so far received the payments, Malaysian Deputy Foreign Minister Hamzah Zainuddin said Thursday. He said full payout would be made after the plane is either found or officially declared lost.

But Steve Wang, a spokesman for some of the relatives, said Friday that families of 127 Chinese passengers have indicated that they will reject any preliminary compensation, partly because they think that Malaysia Airlines should be paying them economic assistance while the search for the plane continues.

They believe that this assistance should be unrelated to any payout given once the incident is ruled a crash and that Malaysia Airlines is trying to shirk that responsibility by offering the preliminary compensation, Wang said. "Once you can issue a convincing report that announces that all the people on the plane have died, then fine, we will move into the compensation phase," he said.