FlySafair, South Africa's largest domestic airline, could be grounded due to a dispute over its ownership structure, potentially leading to a surge in flight prices. The airline is facing accusations from competitors Airlink and Lift for allegedly violating local ownership requirements. The International Air Services Licencing Council (IASLC) and Air Services Licencing Council (ASLC) have ruled that FlySafair's ownership structure, with 74% belonging to an Ireland-based trust, does not comply with regulations limiting foreign ownership to 25%. FlySafair maintains its structure is legal, but legal experts argue that the law distinguishes between trusts and natural persons, making it difficult for FlySafair to meet the 75% ownership threshold. If FlySafair is grounded, it would significantly impact domestic flight capacity, potentially causing a further rise in already inflated airfares.
Flight ticket prices could skyrocket in South Africa if the country’s biggest domestic airline is grounded due to a dispute over its ownership structure.
Discovery’s latest Spendtrend report revealed that its customers paid roughly 16% more for local flights and 20% more on international flights this past festive season. In October 2024, the IASLC ruled that the ownership structure violated the International Air Services Licencing Act, which limits foreign ownership of South African airlines to 25%.
Therefore, even if ASL Aviation Holdings was proven to be a South Africa “resident,” FlySafair would still not meet the 75% threshold for natural person ownership., aviation expert Guy Leitch explained that if this interpretation of the acts were implemented, it would have devastating consequences for nearly the entire South African airline industry — except Lift and Cemair.
Aviation FLIGHT PRICES AVIATION INDUSTRY OWNERSHIP DISPUTE FLYSAFAIR SOUTH AFRICA
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