In preparation for a possible no-deal Brexit, International Airlines Group is doing all it can to uphold and validate its European identity in order to continue its post-Brexit operations on the Continent. Paradoxically, it is the validation of IAG that could prove to harm the carrier after Brexit.
In the face of a possible no-deal Brexit, International Airlines Group (IAG) appears to be doing all it can to uphold that it is a European entity in order to continue operating within the European Union (EU) after Britain’s departure, El Pais reports.
IAG – the parent company of Iberia, Vueling, British Airways (BA) and Aer Lingus – calls Spain its legal base and currently, “is in talks with the Spanish government and the European Commission to try to ensure that IAG continues to be considered an EU-based company, and as such covered by community rules.”
The final decision as to the nationality of post-Brexit IAG, reports the outlet, will be determined by the European Commission. IAG and Spain’s Public Works Ministry have, it seems, already been communicating over how best to preserve IAG’s European identity.
According to documentation exchanged between the parties, “the government has conveyed to Brussels the efforts of the group to meet the European regulations that set out the criteria for an airline or group to be considered as European: it must have its main headquarters in a member state, and be majority owned or controlled by a person or entity based in the EU. Brussels has doubts as to whether IAG meets this last condition, while the company claims it does.”
As if the situation with IAG wasn’t complex enough, the flip-side to confirming the entity’s European identity could actually negatively impact one member of the group: British Airways.
When it comes to Britain’s flag carrier, the loss of European air traffic rights is certainly something to contend with. But as BoardingArea‘s Gary Leff observes regarding BA’s parent company, “IAG…currently has majority European ownership. Post-Brexit, UK owners would be excluded from that calculation and the company — which is registered in Spain — is expected to fall beneath that threshold.”