Tuesday, June 7, 2011

Canada Clarifies "Control"

The Canadian Transportation Agency has issued an official Interpretation Note on the criteria it will apply when determining whether or not an airline is "controlled in fact" by Canadian citizens for the purposes of acquiring operating authorization.  The full note is available online here.

Not surprisingly, the criteria is open-ended, vague, and highly impressionistic.  For instance, the note states that "[c]ontrol in fact depends upon the facts of each situation and so can only be evaluated on a case-by-case basis. As each case is unique, all managerial, financial and operational air carrier relationships, or proposed relationships, must be considered before making a determination."  Further, despite providing a "list of factors" the CTA will consider in its control analysis, the note adds an important caveat that the list provided "is not exhaustive."  As such, almost any foreign involvement in a Canadian carrier remains subject to government fiat.


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