The Civil Aviation Authority of Thailand (CAAT) has quietly put a cap on issuing new air operator certificates (AOCs) for start-up carriers as it trains more personnel to oversee regulation and enforcement of standards. CAAT has not publicly reported the moratorium on new AOCs, but an official with the agency, speaking to AIN on condition of anonymity, confirmed that no new certificates will be issued until the agency resolves a shortage of qualified inspectors and implements new procedures.

“Ovecoming these issues will play an important part in paving the way for Thailand's civil aviation safety to be elevated to Category 1 again,” the official said. In December 2015 the U.S. Federal Aviation Administration downgraded the country's civil aviation safety to Category 2 due to safety concerns.

This situation automatically bans Thai airlines from introducing new routes to the U.S. or increasing the frequency of existing ones. Currently no Thai carrier flies to the U.S. Flag carrier Thai Airways International (TAI) stopped operating the Bangkok-Los Angeles route in October 2015. U.S. airlines are also not allowed to code share with Thai carriers.

Over the last several years, Thailand has struggled to comply with International Civil Aviation Organization (ICAO) standards. In a 2015 audit on CAAT ICAO identified shortcomings in 69 of the 90 areas covered. Thailand is also one of the eight countries tagged with a red flag, indicating significant security concerns by ICAO.

The official said that the market is already crowded with 24 carriers operating in Thailand, 10 of them offering scheduled services while the other 14 are freighters. Of the 10, five are Thai-owned: TAI, Bangkok Airways, Orient Thai Airlines, Nok Air and Thai Smile. The other five are joint ventures with Thai companies, namely Thai AirAsia, Nok Scoot, Thai Lion Air, Thai AirAsia X and Thai Vietjet Air. Nine of the 10 airlines account for 70 percent of all international flights out of Thailand.

The official stressed that at the moment there is no place for another airline as it would mean disintegrating the market further. “At the moment one airline is on the verge of having its AOC revoked by CAAT due to operational problems and is cash-strapped,” the official noted, declining to name the carrier.