South Africa’s largest airline, FlySafair, has been given a year to reduce its foreign shareholding, or it risks having its license suspended.
- FlySafair has been given a year to reduce its foreign shareholding to comply with regulations.
- The airline risks license suspension if it fails to meet the 12 months deadline.
- At least 75% of the voting rights in a domestic airline must be held by South African citizens according to the law.
South Africa’s largest airline, FlySafair, has been given a year to reduce its foreign shareholding, or it risks having its license suspended.
If the airline fails to meet the deadline of a year from Jan. 23, it will be required to appear before the Domestic Air Services Council to explain why its license should not be revoked, according to a statement from the Department of Transport on Wednesday.
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FlySafair is also required to submit a term sheet detailing its milestones and compliance plan within 14 days, along with monthly progress updates to the council, Bloomberg reported.
In December, the council determined that FlySafair does not comply with the local ownership regulations.
According to the law, at least 75% of the voting rights in a domestic airline must be held by South African citizens. This means that while foreign entities or non-citizen entities may invest in an airline, they cannot collectively control more than 25% of the voting rights.
This ruling came after a complaint by domestic carrier Lift, owned by Global Airways Operations.
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The grounding of FlySafair, which controls 60% of the domestic market and carries around 30,000 passengers daily with its fleet of 34 aircraft, could leave hundreds of thousands of people stranded.
South Africa’s aviation sector has already faced significant challenges in recent years, including the prolonged bankruptcy proceedings and downsizing of South African Airways, the closure of state-owned Mango, and the collapse of Comair Ltd. in 2022.
