AFB stated:
Like it or not the fact is that Our Airline will remain and probably the last to do so in this region. The Nauru Govt just simply will not let it fold.
From that comment, one could assume that the airline would, if needed, be propped up by the Nauru government. Arguably (and probably rightly) the airline service is so essential to the people of Nauru, that Government support is justified.
Now, current Australian Government policy does not allow international airlines to carry domestic passengers and freight. Dispensation only occurs on an ad hoc basis BUT only in exceptional circumstances where there is a benefit to Australia AND Australian Airlines cannot provide the necessary domestic services. (New Zealand is a different matter due to the Single Aviation Market Agreement).
Interestingly though “Our Airline” is a select foreign carrier that holds an Australian AOC, with its aircraft being registered to the:
GOVERNMENT OF THE REPUBLIC OF NAURU
Office of The President
YAREN NCD
REPUBLIC OF NAURU
The Registered operator is listed as:
NAURU AIR CORPORATION
PO Box 10355
Adelaide Street
BRISBANE QLD 4000
AUSTRALIA
Does this mean that “Our Airline” can compete for Domestic passengers and freight as they are a holder of an Australian AOC? I know that they are taking over the Norfolk Island service, so it would appear that they can.
Now, if what AFB suggests, that "the Nauru Govt just simply will not let it fold" is correct, could it not be argued that Australian carriers could find themselves competing against not only a foreign owned, but a subsidised, airline on Australian routes and contracts.
If those premises are correct, could it further be argued that Australian carriers are competing against an airline that has it security supported by, at least in part (and agreeably indirectly), by the Australian Official Development Assistance of $26 odd million?
BTW this is not meant as a slag off at “Our Airline”, but merely a discussion point. If those assumptions are correct, it could be seen to skew the level playing field towards “Our Airline” with regards to tenders etc.
Perhaps I have just read too much into all this, but interested to hear others thoughts.