Making It Harder to Fly Canadian Skies…

…through unfriendly foreign ownership regulations. Airlines are another protected Canadian industry like telcos, broadcasting, dairy (a 2019 story: “Protected industries: Why more than a third of the Canadian economy is walled from competition”)–so higher prices and business complacency, especially regarding innovation. Tough on us, eh? Excerpts from an opinion piece at the Globe and Mail by an excellent columnist:

Flair Airlines flap should prompt Ottawa to relax foreign ownership rules

Rita Trichur

The fate of Flair Airlines [website here] is caught up in stifling and outmoded federal airline regulations, and Canadians should be outraged at the prospect of losing yet another discount carrier.

At issue is whether Edmonton-based Flair is actually controlled by foreigners, in contravention of federal law, despite the airline’s claim of being 58 per cent Canadian owned. Specifically, the Canadian Transportation Agency suspects U.S. investment firm 777 Partners is actually calling the shots at Flair, even though it only owns a 25-per-cent stake.

It seems three of Flair’s five directors are – gasp – U.S. citizens who have connections to 777 Partners. What’s more, Flair apparently leases a number of planes from the Miami-based investment firm and owes it a whole whack of money.

Oh my swirls! An American private equity firm is investing in our airline industry and providing us with a lower-cost choice for air travel to Canadian, U.S. and Mexican destinations. Predictably, rival airlines are kicking up a fuss. But good luck trying to find a Canadian who thinks this is an actual problem.

This regulatory fiasco involving Flair is the latest example of how Canada’s outdated laws and regressive attitude toward foreign investment doom discount airlines, limit competition and harm ordinary Canadians who are fed up with overpriced air fares.

The blame for this mess lies squarely with Ottawa. Instead of opening up Canadian skies to real competition from foreign-controlled airlines when it had the chance, the Trudeau government opted to merely tinker with our foreign investment rules…It’s clear our government’s aversion to foreign investors makes no sense. So, if Ottawa is serious about increasing competition in the airline sector, it must relax the remaining foreign ownership restrictions for airlines that fly domestic routes.

No Canadian cares if Americans, or other foreigners for that matter, control airlines that service destinations within Canada. We just want to pay the lowest possible price for a ticket.

…How many money discount airlines need to fail before Ottawa pursues policies that create real competition?

Canadians shouldn’t have to pay through the nose for air travel. We’ve suffered long enough. And after being stuck at home for the past two years, now is the time to demand change.

Follow Rita Trichur on Twitter: @ritatrichur

And those protected biggies have an awful lot of lobbying clout with Ottawa Centre so plus ça ne change pas, plus c’est la même chose, to vary the phrase.

Earlier posts based on pieces by Ms Trichur:

Will Financial Actions Taken under Emergencies Act Lead to PM Trudeau’s Government Acting Seriously vs Money Laundering in General?

Money Laundering, or, Canada Washes Whiter in the Great Shell Company Game (Note “Cartoon of the day” UPDATE)

PM Trudeau’s Government vs Financial Crime/Money Laundering: “Kid- Glove Treatment”

Mark Collins

Twitter: @mark3ds

Wish this was the theme song for this country:

See the Lockheed Super Constellation to the left of Frank?

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