easyJet (London Luton) has warned that it might have to suspend voting rights of a "small percentage" of shareholders from the United Kingdom or other non-European Union states in case of hard Brexit with no transition period.
The LCC simultaneously revealed in a stock market filing that it is currently 49%-owned by entities from the EU (excluding the UK), Norway, Liechtenstein, Iceland, or Switzerland. As such, it falls just marginally short of the 50% plus one share requirement for EU control and ownership.
"If the EU does not give airlines any adjustment period to comply with the applicable EU ownership and control regulations, the Board stands ready to activate existing provisions of our Articles of Association to ensure that the Company will comply following Brexit. This would be achieved by exercising the Company's existing powers to suspend shareholders' voting rights, in respect of a small number of shares. Given the current level of EU ownership, any suspension of voting rights should only apply in relation to a small percentage of shares," the airline said.
easyJet also underlined that it is well prepared operationally for Brexit thanks to the establishment of new units in Austria (easyJet Europe) and the UK (easyJet UK), transferring over 1,000 pilots, re-issuing 3,300 cabin crew licences and re-registering 133 aircraft from the UK to Austria, and the establishment of a spare parts pool in Austria.
Meanwhile, IAG International Airlines Group also issued a notice to shareholders in which it capped non-EU ownership of the holding to the current level of 47.5%.
"After the publication of this announcement no acquisitions of shares by Relevant Non-EU Persons may take place. The Board confirms that it will not issue any certificate to Relevant Non-EU Persons that would make such acquisitions effective under the Company’s bylaws," CFO Enrique Dupuy de Lôme said in the notice.
However, IAG explicitly said that for the time being, it includes all UK-based investors within the quota for the EU investors.
"Relevant UK Persons are not and will not be treated as Relevant Non-EU Persons and, therefore, are not and will not be subject to the restrictions on share acquisitions set out in this announcement, unless IAG notifies shareholders otherwise. IAG has no plans to issue such a notification," the group said.
IAG has been involved in a legal argument with the European Commission regarding its ownership structure. The group is arguing that as a Spanish-registered holding with a complex structure of shareholding of the main airlines, namely British Airways and Iberia, it will meet the post-Brexit EU control and ownership rules.