Flair Airlines is Canadian, licences won’t be revoked: CTA

The Canadian Transportation Agency (CTA) has found that Flair Airlines is Canadian, it announced Wednesday.

The low-cost airline’s licences that allow it to fly in Canada were under investigation due to the influence of U.S.-based investor 777 Partners LCC, to which Flair turned in order to stay afloat during the COVID-19 pandemic.

1:49 Future of Flair Airlines still up in the air

The airline had until May 3 to prove it is Canadian, and now CTA says that it passed the test. The CTA cited the fact that Canadian shareholders now have the right to appoint no less than half of the company’s board, and more than half of the board’s members must be Canadian as reasons for its determination.

“It’s a fantastic day for team Flair,” president and CEO Stephen Jones said Wednesday during a press conference. “‘The question has been answered.”

1:40 ‘Flair is Canadian’ says airline’s CEO following CTA decision

He said that the Edmonton-based company “never doubted” that it was Canadian and the decision by the CTA is very clear and without any conditions: “Flair is Canadian.”

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Flair had made adjustments to its board of directors and governance structure to dampen the influence of 777 Partners when its licence that allows it to fly in Canada was at risk. Canadian legislation allows no more than 49 per cent ownership of a Canadian airline by foreign entities.

777 Partners no long holds unique shareholder rights and Flair has demonstrated it can make money from its own operations and not rely on 777, two other reasons CTA found Flair was Canadian.

Flair Airlines launched in 2004 as a charter airline and offered regular service in 2018. The company has announced plans to aggressively grow and expand its fleet to 50 aircraft within the next five years.

Whether Flair was Canadian initially came into question on March 3, when CTA pointed out that 777 controlled its board, its rights exceeded other shareholders and Flair depended on 777 for financing and leasing aircraft.

As the review took place, Flair argued that it has been vital in improving competition in Canada and reducing airfare prices, and suspending its licence would hurt the sector.

Now that its licences are secure, Jones said Flair’s mission remains the same: to keep its costs and fares low.