The Agency found that Flair is controlled by Canadians.
There is a plane flying into the airport in 2021.
The photo was taken by Larry Wong.
The Canadian Transportation Agency determined that the discount carrier is sufficiently Canadian to fly domestically.
The possibility of losing the domestic operating licence of the company, which offers cheap fares and no frills service for flights throughout Canada and to destinations in the United States and Mexico, had been looming.
The company did not meet the requirements for Canadian ownership of a domestic airline according to a preliminary investigation by the CTA. Under federal law, at least 51 per cent of a domestic airline's voting shares must be Canadian, and no more than 25 per cent of voting interests can be held by a single non-Canadian company or person.
The airline has a partnership with a Miami-based company that has a 25 per cent stake. The CTA pointed to the U.S. investment firm's control of the board of directors and suggested it had control over the airline since it depended on it for financing and the lease of aircraft. The private equity firm was believed to be involved in the management of the business.
In order to address the CTA's concerns, Flair requested a temporary exemption from the ownership rules. The company promised to change its board of directors, and said it would pay off its debt.
The CTA said it was satisfied with the steps taken by Flair to address the concerns.
After considering all of the facts, theCTA found that the company was not in a position to exercise control over the company.
Stephen Jones is expected to respond to the decision in a press conference today.
The company, which was founded in 2005 as a charter operator and transitioned to scheduled service in 2017, was struggling in the year before. As the COVID-19 pandemic battered large incumbents like Air Canada and WestJet Airlines, Flair aggressively pursued market share and expanded service.
Prior to its regulatory troubles, Flair had announced plans to increase its fleet to 30 aircraft by mid-2023 and 50 aircraft by 2025.
The travel industry is still recovering from the devastating impacts of the COVID-19 Pandemic, so it's not surprising that the regulators would be willing to show some flexibility.
Most Canadians would realize that it is not a lot of competition compared to the U.S. or Europe or Asia.
CTA and Canadians want them to solve the problem because they want more competition.
Email: mpotkins@postmedia.com
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