In a statement Indonesian carrier Garuda Indonesia said, air cargo firm PT My Indo Airlines has filed a lawsuit against it over failure to repay a debt.

The court proposal had no immediate impact to Garuda’s operations, the company said in the statement, adding it will ensure flight services continue.

The first court appearance is scheduled to July 27.

“We are currently studying the PKPU proposal submitted by MYIA together with consultant appointed by the company to provide further response to the proposal,” said Garuda’s CEO Irfan Setiaputra in a statement. He did not provide details on the debt amount.

PKPU is an Indonesian court proceeding that could be initiated by either debtor or creditor seeking debt settlement.

Since June 18, the Indonesia Stock Exchange has suspended trading in Garuda’s shares after the airline defaulted on its $500 million sukuk a day earlier.

In a statement Garuda said, it was considering settling its outstanding debt in court as its finances continue to be significantly impacted by the coronavirus-induced COVID-19 pandemic.

In 2020, Garuda had reported a loss of around $2 billion and listed its short-term liabilities at $3.4 billion.

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