The Canadian government has raised the threshold for foreign ownership of Canadian-registered airlines to 49%, although a single international investor still cannot own more than 25% of shares, CNW has reported.

Under the new rules, which have already entered into force, foreign investors will continue to be limited to a 25% share in the case of speciality air service providers, such as air ambulance providers.

While foreign investors are now allowed to hold a 49% stake in general, international air carriers cannot exceed the 25% threshold either alone or in combination.

The change is expected to provide a boost for Canadian carriers, including cargo operators, for whom it may now be easier to raise capital from abroad.

The new rules are significantly more liberal than the law in the United States, which limits foreign ownership of airlines to 25%. In the European Union, foreign entities are allowed to own up to 49.9% of shares and are barred from exercising effective control of the EU-registered airlines.