(FT paywall) EU gives airlines deadline for no-deal Brexit
https://www.ft.com/content/8c0a9f86-2641-11e9-b329-c7e6ceb5ffdf
Plan would potentially force sales of shares for carriers to stay in the air
Brussels is to give airline groups such as IAG, owner of British Airways and Iberia, a seven-month deadline to overhaul their shareholder make-up in order to retain full flying rights within the EU
if Britain crashes out of the bloc without a deal next month.
The tight adjustment period for airlines, which must show they are majority owned and controlled by EU nationals in order to have full rights to fly through the continent,
is outlined in revisions to a draft law seen by the Financial Times.
EU member states are broadly supporting the approach ahead of Britain’s scheduled departure on March 29.
Aviation is a closely-regulated sector that faces a double blow from Brexit, since an abrupt UK departure from the EU would disrupt not only flying schedules
but the licenses that carriers currently use to operate, which are administered based on the nationality of shareholders.^
Senior EU officials say the proposed seven-month grace period is coupled with exacting requirements and deadlines, which would force carriers such as IAG and Ryanair, which also has a large number of UK shareholders,
to potentially trigger forced-sales of shares by non-EU investors.^
Plans by airline groups to maintain existing licenses must be presented to regulators within two weeks of the draft law being adopted, which could come later this month.
“That plan shall set out, in a complete and precise manner, the measures intended to achieve full compliance with the [EU] ownership and control requirements as from the 27 October 2019 at the latest,”
the draft legislation states.
“Where the air carrier has not presented a plan within the [two-week] time limit, the competent licensing authority shall revoke the operating license.”