The Civil Aviation Authority of Bangladesh (CAAB) board on Tuesday approved the proposed operation and maintenance (O&M) agreement with a Japanese consortium for Hazrat Shahjalal International Airport's Third Terminal, marking a major step towards finalising the long-awaited deal ahead of its planned December 16 inauguration.

Reliable CAAB sources confirmed to Aviation Express that the board reviewed the revised draft agreement and its terms and conditions before granting approval.

The board's decision has already been forwarded to the Ministry of Civil Aviation and Tourism for further processing and necessary approval, the sources said.

Documents accompanying the proposal include two certificates signed by CAAB Chairman Air Vice Marshal Md Mostafa Mahmud Siddiq, affirming that the official cost estimate was prepared in accordance with applicable procurement rules and that the proposal complied with relevant laws, regulations, and tender requirements.

The board's endorsement marks a crucial procedural milestone, although the agreement still requires clearance from the Ministry of Law, Ministry of Finance and Cabinet Committee on Economic Affairs before it can take effect.

Meanwhile, the proposed agreement has drawn scrutiny over several contentious provisions, including revenue sharing, Biman Bangladesh Airlines' operations, liability for construction defects, and potential changes to existing laws.

Among the most controversial clauses is a proposed 15-year restriction on commercial operations at competing civil airports within a 100-kilometre radius of Dhaka.

Another provision reportedly seeks to restrict or suspend international flight operations at HSIA's existing Terminals 1 and 2 following the commissioning of the Third Terminal.

Sources also indicated that Bangladesh's revenue share could be reduced below the previously discussed 27 percent during the initial phase of operations, raising concerns over the agreement's long-term financial implications.

Despite the board's approval, the finalisation of the deal remains contingent on further government clearances and the resolution of outstanding issues surrounding national interests, airport competition, and revenue protection.