Complaints have been made to an aviation regulator over the shareholding of FlySafair.
According to legislation, airlines that are domiciled in South Africa, like FlySafair, must have a local shareholding of at least 75%. International regulations state that airlines in this country which operate internationally must have a local shareholding of 50%.
According to News24, two of FlySafair’s competitors have approached the International Air Services Council and the Air Services Licence Council regarding the airline’s shareholding.
FlySafair’s shareholding structure was changed in 2020, ahead of a possible merger with Airlink, according to News24. This merger did not go ahead, however.
There have also been complaints that FlySafair has been using its dominant market position to undercut rivals. Since the demise of airlines like Comair and the collapse of SAA, FlySafair has up to 60% of the domestic air travel market and is also expanding into the rest of Africa.
Local aviation watchers have said that because of FlySafair’s market dominance, it is simply too big to ground, and even if a finding is made against it, it will likely be given time to rectify matters without being grounded.
A local shareholding requirement for airlines is not uncommon around the world, but critics say it is archaic and should be done away with.
[Image: Peter Biela from Pixabay]