moa999
Couple of points.
HK aviation law is different to Australia - there is no 50% threshold.
Otherwise Cathay Pacific would have no international routes - having historically been >50% owned by the British company Swire Pacific, and now something like 40% Swire (British) and 30% Air China (China) with a v/v share in Air China. So the proposed Jetstar HK has lower foreign ownership (at 66%) than CX. HK law as I basically understand it comes down more to management headquarters, and board location (ie. a control test). Whether Jetstar HK meets this due to the shared services provided by Australia I don't know.
As Hong Kong is a SAR of China, “Principal Place of Business” was adopted in the Basic Law rather than 51% ownership because there is technically no such thing as a Hong Kong national. In determining “Principal Place of Business” the Hong Kong SAR government looks not at the proposed airlines “PPoB”, because that is a given, but at the shareholders “PPoB”. The facts are that J* Hong Kong will be 33.3% owned by the Qantas group whose “PPoB” is Australia and is headquartered in Sydney. Another 33.3% will be owned by China Eastern whose “PPoB” is China and is headquartered in Shanghai. Cathay Pacific on the other hand is 45% owned by Swire Pacific which is listed on the Hong Kong Hang Seng Index. It is headquartered at Pacific Place, Central, Hong Kong SAR and has its “PPoB” in Hong Kong. 25% is owned by local individual and institutional investors and Air China owns the remaining 30%. While the Basic Law doesn’t directly state a 51% requirement, the “PPoB” method indirectly does the same thing. Under the “PPoB” measurement, Cathay Pacific is 70% locally owned where J* Hong Kong will be 66.6% foreign owned. It is also worth pointing out that no airline that is/was based in Hong Kong since the handover to China in 1997 has been owned by more than 49% by a foreign airline or company with its “PPoB” outside Hong Kong. There is a reason for this and it is the way the Hong Kong SAR government interprets “The Basic Law”, Chapter V, Section 4.
I have no problem with the foreign airlines owning such a high %ge of Virgin Domestic, but Virgin Australia International should be properly separated, properly reported and properly accounted for, and people should be able to buy shares in it (subject to the 50% cap)
Under the current structure it has been deemed to comply with the Australian Foreign Ownership Laws of and Australian International Airline. If AJ and Qantas have a problem with it, take it to court. They haven’t done this though because their real motive is having the Qantas Sales Act changed and do what VA has legally just done.
The The
NZ already has permission by the FIRB to raise its stake. As no airline will have control I can’t see a problem for SQ or EY also being granted approval to increase their stake.