This article first appeared in Corporate, The Edge Malaysia Weekly, on July 4 - 10, 2016.

WHAT'S in a name? Two years after it began operations, klia2 finds itself in a renewed debate over its name.

Opened by Prime Minister Datuk Seri Najib Razak on June 24, 2014, klia2 was built to replace the old LCCT, which was bursting at the seams. It was named as such as it is part of the entire Kuala Lumpur International Airport (KLIA) development in Sepang.

However, budget airline AirAsia Bhd, the terminal's largest tenant, accounting for 97% of operations there, recently called on the government to change its official name to LCCT as it wants to underline klia2's status as a low-cost carrier terminal.

The call for a name change coincides with the plan by the Malaysian Aviation Commission (Mavcom) to review the country’s passenger service charge (PSC), also known as airport tax, including at klia2.

Industry sources say the independent commission, which started operations in March, has been tasked with regulating economic matters — including the PSC review — relating to the civil aviation industry. Previously, reviews of the PSC were conducted by the transport ministry every five years.

For nine years now, passengers have been paying different rates depending on the terminal they depart from.

"Passengers flying out of klia2 currently pay a lower PSC than those departing from KLIA’s main terminal building. First introduced in 2007, the incentive was to help spur the growth of low-cost carriers at the old LCCT. However, being the largest tenant, AirAsia is seen as the main beneficiary of the incentive," an industry observer tells The Edge.

When contacted, Mavcom chief operating officer Azmir Zain confirmed it is in the midst of reviewing the PSC. "Mavcom is currently conducting an independent review of the PSC and will make the necessary announcement once this is finalised," he says in an email reply. He did not say when the review will be completed.

Azmir adds that with the formation of Mavcom, and as per Section 46 of the Malaysian Aviation Commission Act 2015, it is part of the commission’s role to carry out reviews of the PSC.

Industry sources tell The Edge that the review is expected to be completed later this year. It is understood that the commission may adopt different passenger taxes at  klia2 according to the segments: international, intra-Asean travel and domestic. The effect of this tiered model could see some rates go up and some go down.

From June 2007 till 2011, international air travellers departing from the country’s 39 airports managed by Malaysia Airports Holdings Bhd (MAHB) had been paying a PSC of RM51 each, and domestic travellers, RM9.

International and domestic passengers departing from klia2 paid RM25 and RM6, respectively.

Geneva-based International Air Transport Association (IATA) had criticised the different levels of PSC, saying the lower charges at klia2 were "unfair and discriminate against airlines".

In November 2011, then-transport minister Datuk Seri Kong Cho Ha raised the PSC for international travellers out of the country's international airports from RM51 to the current RM65 and from RM25 to the current RM32 at the old LCCT and Terminal 2 of the Kota Kinabalu International Airport.

In 2014, IATA again urged the government to make the PSC the same for both international airports and LCCTs in the country following the opening of klia2 as it was of the view that the services and facilities at the new terminal were now comparable to those at KLIA. The PSC was also due for its five-yearly review, but the government left the charges unchanged following the twin tragedies of flights MH370 and MH17.

Amid the latest review of PSC, AirAsia is adamant that klia2 is meant for LCCs and wants MAHB to acknowledge the need to have a dedicated LCC hub in Malaysia.

On its part, AirAsia has since June 27 started referring to klia2 as LCCT on its website, mobile app, boarding passes and marketing materials.

This was despite Transport Minister Datuk Seri Liow Tiong Lai coming out to say on June 22 that there will be no name change for klia2, arguing that “names should not be changed for the sake of changing”.

“We understand that we do not have the right to rename the terminal, but we still want to push this as a marketing strategy to tell the world that the terminal is low-cost,” AirAsia group chief executive officer Tan Sri Tony Fernandes was reported as saying last week.

Could the fight over a name be linked to the PSC review? 

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