Hi, on the Gameworld Meigs, Sin Air Oceania has began operating flights out of Australia, which doesn't have open access market rights. Sin Air is based in Singapore, but has investment from an Australian airline in the company. Why are the then allowed tom operate in Australia if the holding company is based in Singapore.
I'm not trying to be against their airline, just was wondering.
Thanks
Because Australia-based companies own the majority of shares for traffic rights purposes. However, this is a risky proposition for the airline in question, because if the Australian companies sell shares to non-Australian companies (or the Australian airlines get liquidated), the airline in question would lose traffic rights.
Also, you should not name any airlines in specific in this kind of questions, because naming them implies they are doing something wrong (which they aren't, for as long as the other Australian airlines giving them traffic rights are fully operational airlines and not investment structures).
Edit: Having reviewed the airline in question, one of the airlines giving traffic rights is not an operating airline (it is a holding without aircraft flights, and therefore considered an investment structure). You may report the company in question if you wish, because the unspoken rule of "operating airlines only to give traffic rights" is not fulfilled in this case.
But on some servers New Zealand is an open country which means that you can fly to anywhere from New Zealand. This also allows you to operate any flight inside the Oceanic treaty meaning that you can operate domestically in Australia and from Australia to New Zealand. That is for example why there is no “Australian airline” on Fornebu. This is because all domestic traffic is already occupied. The domestic is the largest market in Australia as the international market is pretty small. For example an airline would not be able to be that large in Malaysia if only relying on domestic market. Malaysia also has quite a large domestic market but and airline without rights to fly to Singapore, Thailand, Indonesia, China and India could be killed pretty easily.
@CBE - Christian, on Meigs New Zealand does not have unrestricted market access, while there is Oceania Treaty on Meigs, you cannot establish unrestricted traffic rights airline in NZ form a third country. And you are talking about my alliance partner on Fornebu, traffic rights are not "stolen" there, just a regular sub established in NZ which had rights also to fly in AU. No stealing of rights, as this was the way that server was set up, and that player took advantage of it.
... one of the airlines giving traffic rights is not an operating airline (it is a holding without aircraft flights, and therefore considered an investment structure)...
Hi George,
I may be wrong, but I thought it was only against the rules to create a holding with the only purpose of buying shares and thus giving another player traffic rights.
If that New Zealand holding used to own and operate a subsidiary in New Zealand, there is no rule that forbids the player to sell some shares of his subsidiary and allow a foreign investor to manage this airline.
Cheers,
Jan
@Matthew:
The majority of the shares must be owned by New Zealand holdings to keep traffic rights in New Zealand, but the biggest share holder has control. If a foreign investor owns 40% of the shares and three New Zealand investors own each 20% of the shares, the majority of the shares (60%) is in New Zealand hands so the traffic rights are granted. But the foreign investor with 40% is the biggest share holder, so he can manage the airline.
I may be wrong, but I thought it was only against the rules to create a holding with the only purpose of buying shares and thus giving another player traffic rights.
SK said, somewhere - two operating airlines, even by the same player, and must be already operating at the time they give traffic rights. Also the setup should appear to be a regular airline not just a dummy sub with 1 LET or ATR42. I think that interpretation he gave is somewhat just and logical, else you can end up with a holding and a sub flying 2-3 LETs, giving traffic rights.
P.S. In case of Meigs it would not matter if such traffic-rights-giving airline would be set up in Australia or New Zealand, as both of them are access restricted.
Hi George,
I am afraid my formulation was incorrect but I think we agree :-)
I thought the idea behind the rule was that it is okay to sell an existing airline, even if it ends up in foreign hands.
But that it is illegal to create a holding, create a subsidiary, go public and then sell the shares with one purpose: give traffic rights to another (foreign) player. That is creating a structure so someone can buy shares and get traffic rights.
The airline history and stock market history can answer the question... if the airline was created in january, went IPO a few weeks later and then changed hands shortly afterwards, it is a dubious construction. In that case any player can ask the team to investigate the issue (if he has a problem with it). If the airline is two years old, I see no problem. But hey, it is not up to me ;-)
Jan
I believe in considering the spirit of this unspoken rule is not really to strictly specify who gives traffic rights to whom and through which constructs, but rather assure that in overall terms the airline giving traffic rights is a real airline and not just a dummy company.
And because you need two companies to give traffic rights, I would assume both have to pass the check of being real airlines.
Anyway, I think we are getting carried away way beyond what the OP was asking. The simple answer to the OP’s question is: yes it is possible for a foreign airline to have a sub in Australia, with traffic rights granted under specific circumstances which have been defined to always include real operating airlines in order to prevent abuse of giving traffic rights by creating dummy holding structures.