The European Union is willing to grant airlines seven months to adjust to the bloc's control and ownership rules after Brexit, The Financial Times has reported.
All airlines will have to adjust its shareholding structure by October 27, 2019, so that the majority of stock remains controlled by EU entities once all British investors cease to be counted as such. If an airline fails to do so, it will lose the status of a European carrier and all associated benefits, such as the access to the EU open sky.
The new regulatory framework is likely to affect both UK-based airlines, such as IAG International Airlines Group member British Airways and easyJet, as well as others, such as Ryanair. The LCC, despite being registered in Ireland, is also listed on the London Stock Exchange and has a significant number of UK-based shareholders.
According to the law currently drafted in Brussels, the airlines will also have to outline their plan to keep a EU Air Operator's Certificate (AOC) to the regulators within two weeks of the law being adopted.
"That plan shall set out, in a complete and precise manner, the measures intended to achieve full compliance with the [EU] ownership and control requirements as from the 27 October 2019 at the latest. Where the air carrier has not presented a plan within the [two-week] time limit, the competent licensing authority shall revoke the operating license," the draft seen by the FT says.
Most of the carriers, including easyJet, Ryanair, and Wizz Air, have already set up subsidiaries with either EU or UK AOCs to preserve traffic rights in both jurisdictions after Brexit. IAG, in turn, is trying to argue with the regulators that due to its registration in Spain it should retain its EU status.
The United Kingdom is due to leave the EU on March 29, 2019.
