Volaris Costa Rica (Q6, San José Juan Santamaría) is set to begin commercial flights to the United States after the US Department of Transportation (DOT) granted its request for exemption authority and, tentatively, a Foreign Air Carrier Permit (FACP).
The Costa Rica-based carrier's application was originally opposed by Southwest Airlines (WN, Dallas Love Field) on the grounds that its ownership structure failed to meet DOT rules which require applicant airlines to be substantially owned and effectively controlled by citizens of its claimed homeland.
The Texan LCC contended that while Volaris Costa Rica’s application states that its day-to-day operational managers are Costa Rican citizens, those individuals will not be active in control of the carrier and the airline will be effectively controlled by Controladora, the Mexican parent of Volaris (Y4, México City International).
Volaris Costa Rica, in turn, conceded this issue while contending that "effective control" clearly lays with Costa Rican citizens. As such, it requested the DOT to grant it a waiver from the ownership and control standards. In its argument for a waiver, Volaris Costa Rica noted that, at present, there are six US carriers serving the US-Costa Rica market - Southwest, United Airlines, American Airlines, Delta Air Lines, Spirit Airlines, and JetBlue Airways, contrasted with only a single Costa Rican carrier, LACSA Costa Rica. Volaris Costa Rica therefore added that authorization of a second Costa Rican carrier to serve the market, and the ultra low cost services it would provide, would be beneficial, not inimical, to the interests of travelers and consumers of both countries, and to the broader US aviation interest, as well as to the US-Costa Rica aviation relationship.
In its ruling, the DOT agreed to grant Volaris Costa Rica's request for a waiver noting that there were a number of factors weighing in its favour. Among those noted are that the US enjoys positive aviation relationships not only with Costa Rica, but also with Mexico. On the market front, the DOT said US carriers had benefitted significantly from the liberalization of aviation ties with both Costa Rica and Mexico, among which is Southwest.
"Against this background and in the totality of the circumstances presented in this specific case, we find, despite the non-homeland involvement in the carrier’s ownership, that it is consistent with the public interest to use our discretion to waive our ownership and control standard, and that grant of a waiver is not inimical to U.S. aviation policies or interests," the DOT said.
Volaris Costa Rica noted in its initial application that it would run flights from San José Juan Santamaría to each of Houston Intercontinental, New York JFK, and Los Angeles International.
