Iraq's low-cost airline Fly Baghdad on Thursday announced the cancellation of all flights until further notice after the Iraqi government ordered an investigation into the allegations that prompted US sanctions.
On Monday, the US Treasury decided to impose sanctions on the company, accusing it of supporting Iran's Islamic Revolutionary Guard Corps' Quds Force as well as auxiliary groups in Iraq, Syria and Lebanon.
The Baghdad company denied the allegations.
The cancelation of flights was requested by Iraq's Prime Minister Mohammed Shia Al Sudani to allow an investigation to take its course, the airline said.
“We welcome [the government] decision in order to refute the claim of the US Treasury against Fly Baghdad and its chief executive,” it said in a statement.
The airline advised passengers that it cannot refund cancelled tickets because it has no access to its bank accounts. It is also unable to book passengers new tickets on other airlines.
Washington has accused Fly Baghdad of being involved in the transfer of hundreds of fighters – including militants belonging to designated terrorist organisations – in support of Iranian proxy groups in the region since the attacks on Israel on October 7.
Fly Baghdad chief executive Basheer Abdulkadhim Al Shabbani has also been sanctioned and two Iraq-registered aircraft owned by the airline have been listed as blocked property.
In an interview with The National on Tuesday, Nameer Al Qaisi, Fly Baghdad's security manager and aviation consultant, said there were no prior warnings to the sanctions.
“It was staggering and very surprising because we are far from all these allegations directed against Fly Baghdad,” Mr Al Qaisi said.
“How can a passenger airline fly to countries' airports transporting weapons and fighters and ammunition without knowledge of the state?
“How can we bypass all these authorities so easily … this is completely illogical,” he said.