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ARTICLE · 16 NOVEMBER 2016

Government Announces Changes In Foreign Ownership Rules For Canadian Airlines – 'Change In Fact'?

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The Canadian federal government's Minister of Transport, Marc Garneau, announced on November 3, 2016 that the government of Canada plans to raise the cap on foreign ownership of Canadian airlines.

CanadaTransport

The Canadian federal government's Minister of Transport, Marc Garneau, announced on November 3, 2016 that the government of Canada plans to raise the cap on foreign ownership of Canadian airlines from 25% to 49%.  The government appears to be responding to calls from industry and the recommendations in a report from the former Minister of Transport, David Emerson, to encourage more foreign investment in Canadian airlines to foster increased competition.  Minister Garneau also announced that, pending the implementation of amendments to Canadian Transportation Act ("CTA"), exemptions from the current 25% ceiling would be granted and that exemptions have been granted for two discount airlines, Canada Jetlines and Enerjet.  This appears to be a useful step to bring Canada in line with the foreign ownership model for airlines in other G7 countries but, as always, "the devil is in the details".

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