FlySafair (FA, Johannesburg O.R. Tambo) has urgently called on Barbara Creecy, South Africa's transport minister, to intervene in regulatory proceedings that have found the airline falling foul of the country's foreign ownership restrictions. The airline argues that civil aviation regulators' interpretation of the law is flawed and, if applied, would render nearly every airline in the country non-compliant, potentially resulting in widespread suspensions and "catastrophic" economic repercussions.
The budget airline faces a potential suspension or cancellation of its domestic and international operating licences. With a domestic market share of 60%, it argues this would destabilise the local aviation market, threaten the livelihoods of its 1,925 employees with job losses extending to other industries, and result in significant damage to the South African economy and tourism industry.
FlySafair is facing two challenges to its ownership structure before the country's domestic and international licensing councils, following separate complaints from competitors Global Aviation Operations (which operates Lift Airlines) and Airlink (South Africa). On October 31, the International Air Services Licencing Council found FlySafair to be non-compliant, but the airline won a court interdict which requires the regulator to meet with it on January 20 before imposing punitive action.
A similar process has played out at the Air Services Licensing Council (ASLC). On January 14, FlySafair and Global appeared before the council in Pretoria to argue for "mitigation or aggravation", a procedure required before any sanctions may be issued against the airline. During the meeting, the council confirmed its earlier decision on December 19 that FlySafair does not meet nationality provisions. According to the council's interpretation of the law, 75% of voting rights must be held by South African citizens who are residents of the country, meaning natural persons, as a juristic entity cannot have citizenship. The council concluded that ultimate control of FlySafair was held by its parent companies in Ireland (ASL Aviation Holdings) and, ultimately, in Belgium.
FlySafair disputes the council's reasoning and conclusions as unfounded and incorrect and based on misconceptions, factual errors, misinterpretation of the law, lack of legal expertise on the council, and what it claims to be a "fundamental lack of understanding of legal complexities".
The carrier has requested an urgent ministerial exemption from the disputed legal provision while it seeks legal recourse. It has asked Creecy to order the council to suspend any further action against it until the South African High Court provides clarity on the interpretation of the law. It is also asking the minister to facilitate a mediated solution.
"The hope remains that the Minister of Transport will take note and shepherd this process back on a rational path, seeing that the councils are appointed by her and acting under her supervision. FlySafair notes in this regard that the Minister has already indicated, through the circulation of a proposed new Air Services Bill, that government policy is leaning in a direction that favours the interpretation advanced by FlySafair in its disputes with the councils. It is heartening to see that the political will is there to finally address these contentious ambiguities which have been a thorn in the side of the aviation industry for too long," it stated.
