S/C/W/270/Add.2 
 Page 403 
 
 
   
    
 
    
 
    
 
    
PART H 
 
OWNERSHIP 
  S/C/W/270/Add.2 
 Page 405 
 
 
  H. OWNERSHIP  
1. Regulatory aspects 
659. This section will discuss:  (a) the different concep ts associated with the term "ownership", and 
their interactions;  (b) documentary limitations aff ecting the analysis of the issue;  and (c) main 
regulatory developments. 
(a) The different concepts associated with th e term "ownership" and their interaction 
660. As explained in the compilation (paragraphs 7-9, pages 220-221), in the professional and 
academic aviation literature the term "ownership" is indifferently used to refer to three distinct 
concepts: 
(i) The designation  policy through which a country attributes the rights to 
operate, either domestically or under a bilateral Air Services Agreement, to a 
given airline(s) (e.g. the US Departme nt of Transportation granting traffic 
rights to American Airlines but not to Continental Airlines on a non-open-skies destination).  Designation policies were used in the past both at the national level (e.g. before the 1979 de regulation, the US Civil Aeronautics 
Board would attribute the right to operate on a given city-pair to a given 
airline) and at the international level.  They seem now to be confined mainly to the international arena with the marginal exception of public services 
contracts. 
(ii) The national investment/establishment regime
 for airlines, whether operating 
only domestic flights, only international flights, or both.  The investment 
regime may cover also non-scheduled carriers and, in certain instances, 
general aviation/business aviation carriers.  In cases where there is only one, 
publicly-owned airline, there may be no investment regime since none is needed.   
(iii) The withholding
 requirement in ASAs, which grants the right to one party to 
revoke, suspend or limit the authorisation of an airline designated by the 
other party on the grounds that this airline no longer fulfils the conditions of origin stipulated in the bilateral Air Services Agreement.  Withholding policies also include any waivers to  these requirements granted in a 
discretionary (and, hence, revocable ) manner.  The scope of withholding 
policies is limited to international sch eduled (passengers and cargo) services.  
To draw a trade policy parallel, the c oncept is akin to that of rules of 
origin.
362 
661. There is a certain degree of interaction between these three concepts in what one may call the 
"ownership triangle", which explai ns the semantic confusion.  Th is interaction will be described 
below by taking the concepts two at a time. 
(i) Designation and national investment/establishment regime 
662. The interaction between designation and the national investment/establishment regime 
illustrated in Figure 5. 
                                                      
362 The three withholding requirements mostly found in bilateral ASAs are: "substantial ownership and 
effective control", "community of in terest" and "principal place of business" (for a definition, see document 
S/C/W/270/Add.1, page II.656, paragraph 68).  The overwhelmingly dominant requirement is the SOEC clause, 
which explains why the "withholding clause" is usually referred to as the "ownership clause". S/C/W/270/Add.2 
Page 406  
 
  Figure 5 
The investment/designation side of the "ownership triangle" 
 
  
  
  
 
 
  
 
 Source
:  WTO Secretariat 
 
663. In most instances, the situation is relatively st raightforward:  the national investment regime 
requires that a country's airlines be substantially owned363 and effectively controlled364 by its 
nationals, and countries designate airlines that fulfil this criterion. 
664. There are, however, some inst ances (that one may term "sel f-waivers") in which, under a 
bilateral ASA, a country has designated a carrier that  does not fulfil its own investment regime.  These 
cases are extremely rare.  One frequently quoted example is that of Britannia and Monarch Airways, large charter airlines whose beneficial ownershi p ultimately resided in Canada and Switzerland, 
respectively, and which have long been designated by the UK and accepted by other countries as 
such.
365 
665. In cases where the national investment regime allows airlines to be majority foreign-owned 
(e.g. Australia, Switzerland), designation may benef it foreign-owned carriers (e.g. Swiss, which will 
be owned by German flag carrier Lufthansa after a transitional period, is still designated by the Swiss 
authorities under Switzerland's ASAs).  In such cases, there is consistency between the national 
investment regime and the designation policy.   
(ii) Designation and withholding 
666. The interaction between designation and withholding is illustrated in Figure 6. 
Figure 6 
The designation/withholding side of the "ownership triangle" 
 
 
  
 
  
 
  
 
 
Source
:  WTO Secretariat. 
                                                      
363 The thresholds that define an airline as nationally-owned may however vary from 51% to 75% and 
may be different depending on whether foreign owners are airlines or otherwise. 
364  The control criteria may vary, and may even not be spelled out explicitly. 
365 Doganis, R. (2006), "The Airline Business", Routledge, London. National 
investment/establishment 
regime 
Designation Withholding 
National 
investment/establishment 
regime 
Designation Withholding  S/C/W/270/Add.2 
 Page 407 
 
 
  667. The designation-withholding interaction can be anal ysed, first, from the point of view of an 
individual party considered in isolation, and, sec ond, from the point of two ASA partners considered 
together. 
(a) From the point of view of an individual party 
668. In theory, there is no direct link between the policy that an individual country applies to 
designate its own carrier(s) and its withholdi ng policy towards a partners' carriers.   
669. However, in practice the two policies will be based on the same criterion, most frequently 
SOEC.366  In its ASAs, a country will designate carrier s that are substantially owned and effectively 
controlled by its nationals and it will demand that its  partner does the same, mainly to prevent third 
countries' airlines "free-riding" on the rights granted by the agreement.367  It will therefore reserve its 
right under the ASA to withhold authorisation for airlines that are not substantially owned and 
effectively controlled by the nationals of the partner. 
670. It might, nevertheless, be possible to base one's designation and withholding policies on two 
different criteria.  Two scenarios might be envisaged.   
• First, a strict withholding clause (such as SOEC ) and a flexible designa tion criterion (such as 
"principal place of business", for instance).  Ge tting ASA partners to agree to such a set up, 
however, might be difficult.  There is neverthe less one example of such a situation:  the 
numerous agreements re-negotiated by the EC  and/or its Member States following the ECJ 
"open skies" judgments.  These agreements cont ain a "flexible" designation provision on the 
EU side (community of interest), while re taining a "strict" withholding provision on the 
partner's side (SOEC).  This is, however, not necessarily the case in all in stances, e.g. the EU-
CH agreement which carries a PPOB clause on the Swiss side. 
• Second, a restrictive designation policy coupled w ith a flexible withholding policy.  The latter 
scenario has de facto  materialised, according to some observers, for the MALIAT, where 
more flexible criteria than the built-in SOEC criterion are accepted through waivers but where 
certain parties, such as the United States, a pply a stricter designation policy for their own 
airlines. 
(b) From the point of view of two ASA partners 
671. The link between designation and withholding policies becomes more obvious when two 
ASA partner countries are considered together:  one country's withholding policy will affect the 
other's designation options.  Suppose country A had a withholding clause based on SOEC.  An aviation partner of A would be left with a limited set  of designation choices:  designate an airline that 
is SOEC by its own nationals , or be more liberal and designate a carrier that is not
 SOEC by its 
nationals, but run the risk of seeing the carrier lose the respective traffic rights or, at best, benefit from 
a waiver that is inherently legally un certain because revocable at any time.   
672. The various possible combinations of withhol ding and designation policies are illustrated in 
Table 52. 
                                                      
366 Indeed, the ICAO Secretariat notes that the gr ounds on which a Contracting State receives an 
authorisation (i.e. designation) may be addressed in the "R evocation of authorisation" (i.e. withholding) article, 
"since the conditions for not granting an authorisation ar e the same".  (ICAO (2003), "Template Air Services 
Agreement for Bilateral, Regional or Plurilateral Libe ralisation", document ATConf/5-WP/17, page A-11.) 
367 A country A that had concluded an ASA with B, but not with C, would want to avoid C's airlines 
being designated by B to op erate under the A-B ASA.  S/C/W/270/Add.2 
Page 408  
 
  Table 52 
Combinations of designation and withholding po licies in the framework of a bilateral agreement 
 
Type of airline designated by 
contracting State A Withholding clause in the 
bilateral ASA between A and B Legal consequences 
Airline whose ownership and control 
are vested in the nationals of A Substantial ownership and 
effective control No conflict .  However, the clause is generally 
not spelled out in detail and its interpretation may vary from party to party. 
Airline whose principal place of business is in A but whose ownership and control are not vested in the nationals of A Substantial ownership and 
effective control Conflict .  Impossibility to operate a service if 
no waiver. 
Multi-national airline (partially owned by nationals of A)
368 or airline 
whose ownership and control are vested in the nationals of States members of a plurilateral agreement to which A is party Substantial ownership and 
effective control Conflict .  Impossibility to operate a service if 
no waiver.   In the case of a plurilateral ASA, consolidation foreclosed (e.g. the planned BA-KLM merger before the ECJ judgments). 
Airline whose ownership and control are vested in the nationals of A Principal place of business No conflict.  Ownership and control by 
nationals of A automatically imply that the 
principal place of business is located in A. 
Airline whose principal place of 
business is in A but whose ownership and control are not vested in the nationals of A Principal place of business No conflict 
Multi-national airline (partially 
owned by nationals of A) or airline whose ownership and control are vested in the nationals of States members of a plurilateral agreement to which A is party Principal place of business No conflict  if the principal place of business is 
located within the geographical ambit of the multi-national airline
369 or of 
 the plurilateral ASA. 
Airline whose ownership and control 
are vested in the nationals of A Community of interest No conflict .  "He who can do more  
can do less". 
Airline whose principal place of 
business is in A but whose ownership and control are not vested in the nationals of A Community of interest No conflict  if the principal place of business is 
located within the geographical ambit of the community of interest clause.   Conflict  otherwise. 
Multi-national airline (partially 
owned by nationals of A) or airline whose ownership and control are vested in the nationals of States members of a plurilateral agreement to which A is party Community of interest No conflict  if the principal place of business is 
located within the geographical ambit of the community of interest clause.   Conflict  otherwise. 
 
Source :  WTO Secretariat. 
 
673. If substantial documentation were  available on national investment regimes, as was the case 
during the first review (Table A2, pages 234-235 and Table A3, pages 236-239, and see also below 
the section on documentary limitations), it would be po ssible to list the bilateral agreements falling 
under the various combinations identified in Tabl e 52 and to measure the traffic they cover.  
Commercial data on existing direct services, such as those used in QUASAR, would also allow for the 
identification of waivers and their development over time.  
674. Table 52 is incomplete, as it does not include  asymmetric withholding clauses, such as the 
COI-SOEC combination (for the US-EU agreement, th e Euro-Med agreement or the EU agreements 
renegotiated post the ECJ 2002 "open skies" judgeme nts), or the COI-PPOB combination (for the EU-
CH agreement).  These asymmetric clauses appear to be on the rise and may spread beyond the EU-
                                                      
368 For instance, SAS or Gulf Air. 
369 For instance, Copenhagen for SAS.  S/C/W/270/Add.2 
 Page 409 
 
 
  based agreements.  For instance, when negotiating th e MALIAT, some of its members tried, in vain, 
to include such an asymmetric clause.   
(iii) National investment /establishment regime and withholding 
675. The interaction between the national investme nt/establishment regime and withholding is 
illustrated in Figure 7 
Figure 7 
The investment/withholding side of the "ownership triangle"  
 
  
 
  
Source :  WTO Secretariat. 
 
676. Withholding clauses have a significant impact on national investment regimes because the 
exercise of traffic rights under an ASA is nearly always linked to the nationality of the airline.370  
Under an SOEC withholding clause, in fact, an airline must be able to prove at all times that it has the 
nationality of the country which concluded the AS A on its behalf in order to have guaranteed 
continued use of the traffic rights granted under the agreement.371   
677. The pervasiveness of the SOEC withholding cl ause and its link with national investment 
regimes has been viewed by many commentators as the main reason that has prevented the emergence 
of truly global airlines in an industry w hose business is, by its very nature, global.372  T h i s  
"nationality" requirement has in effect prevented airlines from raising the funds they needed by way 
of inward (foreign) investment and has generally prevented cross-border mergers and acquisitions and 
overall consolidation within the industry.  Whilst, in  theory, nothing prevents a country from allowing 
majority foreign ownership of its airlines, in practice there is a risk that traffic rights may be lost or 
curtailed as a result.  Accordingly, a country's f aculty to open up access to foreign investors in the 
airline sector is effectively limited by the most rest rictive of the withholding clauses applied by any of 
its aviation partners. 
678. The relationship between withholding and th e national investment regime is not 
unidirectional, however.  There have been instan ces where changes in the ownership structure of 
airlines have impacted on the withholding regime app lied.  One case in point is that of Aerolineas 
                                                      
370 Only 7.6 per cent of the WASA traffic is accoun ted for by bilateral ASAs containing a withholding 
clause based "principal place of business", i.e. a clause which precludes from the nationality of the airline.  The "community of interest" clause account s for only 0.1 per cent of the traffi c.  (ASAs for which the withholding 
clause is undetermined account fo r 2.3 per cent of the traffic.) 
371 Van Fenema, H. P. (2002), "National ownership and control provisions remain major obstacles to 
airlines mergers", in IC AO Journal, number 9. 
372 See, amongst others, Van Fenema, op. cit. ;  Hörstke, S. (2003), "Air carrier ownership and control 
revisited at the Fifth Worldwide ICAO Air Transport Conference", Annals of  Air and Space Law, Vol. XXVIII;  
Lelieur, I. (2003), "Law and Policy of Substantial Ownersh ip and Effective Control of  Airlines – Prospects for 
Change", Ashgate, Aldershot, Doganis, R. (2006), "The Airline Business", Routledge, London. National 
investment/establishment 
regime 
Designation Withholding S/C/W/270/Add.2 
Page 410  
 
  Argentinas (see also document S/C/ W/270/Add.1, page I.34, paragraph 69).  In 1991, Spain's Iberia 
bought a majority shareholding (85 per cent) in the Argentine carrier, but Argentina's bilateral 
partners continued to accept Aerolineas as the Argen tina-designated carrier in spite of the fact that 
effective control had switched to Spain.  In th e case of the United States, however, such designation 
was only accepted on condition that frequency or capacity limitations on US airlines flying to Buenos 
Aires be lifted.  This example highlights the pot ential risks associated with opening up to foreign 
inward investment in airlines in an aviation regime  still dominated by restrictive withholding policies. 
(b) Documentary limitations 
679. From a documentary point of view, the issue of ownership in all its facets is in a somewhat 
paradoxical situation.  There is an abundance of literature:  several books, numerous articles published 
in academic journals, and countless press clippings.  Howe ver, virtually all this literature is centred on 
a very narrow geographical area, i.e. the United St ates, the European Communities and their bilateral 
relations.  Moreover, this literature has, to a larg e extent, become outdated as a result of two very 
recent developments:  the US Congress rejection in  November 2006 of the amendments proposed by 
the Department of Transportation to relax the rule  of interpretation of the ownership legislation ;  and 
the conclusion of the First Phase US-EU Air Transpor t Agreement (signed on 30  April 2007, entering 
into force on 30 March 2008). 
680. Rather than summing up this "transatlantic" lite rature, the WTO Secretariat has decided to 
focus on a systematic, in as much as possible, collect ion of data concerning regulatory regimes (both 
in terms of national investment regimes and of w ithholding/designation polic ies) and of economic and 
commercial realities (structure and development of the ownership structure of scheduled airlines). 
681. However, such a systematic collection suffers from a series of documentary limitations:  there 
exists no exhaustive inventory of national investme nt/establishment regimes, no complete inventory 
of national designation and withholding policies, no extensive data on tran s-national ownership of 
airlines. 
682. Moreover, compared to the situation at the time of the first review, these documentary 
limitations have worsened: 
- ICAO has discontinued its annual publication, "The World of Civil 
Aviation", and replaced it with a shor t "Annual Report of the Council".  In 
that process, it has ceased to monitor in a detailed manner national ownership and privatisation developments, there by rendering impossible the complete 
updating of Table 1 (page 220) and Table A1 (page 230) of the compilation.   
- IATA has not pursued its efforts to constitute an inventory of national 
investment regimes.   
- The attempt by ICAO to set up an inve ntory of designation and withholding 
policies has largely failed, since only 47 of its 190 Contracting States have provided an answer to its 2003 questionnaire (see compilation, page 222, 
paragraph 13). 
(c) Regulatory developments 
(i) Regulatory developments with regard to withholding and designation 
(a) Multilateral developments 
683. In March 2003, ICAO's Fifth Worldwide Air Transport Conference (ATConf/5) reviewed the 
Template Air Services Agreement (TASA) for bilate ral and for regional/pluri lateral arrangements.   S/C/W/270/Add.2 
 Page 411 
 
 
  The TASAs had been developed for the guidance and op tional use, selectively, adapted or in full, by 
parties in their air transport relationships.   
684. With regard to the withholding (and designation)373 clause, the bilateral TASA contains the 
relevant provisions in Article 4 (and Article 3).374  The article indicates under which circumstances 
"the aeronautical authorities of each Party shall have the right to withhold [...] authorisation [...] with 
respect to an airline designated by the other Pa rty, and to revoke, suspend or impose conditions on 
such authorisations, temporarily or pe rmanently".  Three options are proposed:375 
685. In the traditional  approach, the TASA reads as follows: 
"a) in the event that they are not satisfied that  substantial ownership a nd effective control are 
vested in the Party designating the airline, nationals of that Parts, or both" 
686. For the transitional  approach, the TASA presents  two options, as follows:   
Option 1 
"a) in the event that they are not satisfied that  the airline is and remains substantially owned 
and effectively controlled by nationals of any one or more States in a group, or by any one or 
more of the Parties themselves" 
Option 2 
"a) in the event that they are not satisfied that  the designated airline has its principal place of 
business (see (i) below) [and permanent residence]  in the territory of the designating Party;  
b) in the event that they are not satisfied that the Party designating the airline has and 
maintains effective regulatory control (see (ii) below) of the airline;  
Notes: 
(i) evidence of principal place of business includes such factors as:  the airline is established 
and incorporated in the territory of the desi gnating Party in accordance with relevant national 
laws and regulations, has a s ubstantial amount of its operati ons and capital investment in 
physical facilities in the territory of the designating Party, pays income tax, registers and bases its aircraft there, and employs a significan t number of nationals in managerial, technical 
and operational positions. 
(ii) evidence of effective regulatory control incl udes but is not limited to:  the airlines holds a 
valid operating licence or permit issued by the licensing authority such as an Air Operator 
Certificate (AOC), meets the criteria of the d esignating Party for the operation of international 
air services, such as proof of financial health, ability to meet public interest requirement, 
obligations for assurance of service; and the designating Party has and maintains safety and 
security oversight programmes in compliance with ICAO standards." 
687. Finally, the full liberalisation  approach bases evaluation of withholding traffic rights on 
whether there is conformity with the laws and re gulations of the designating States.  Withholding 
prerogatives are therefore entirely divorced from nati onal investment regimes and, instead, focused 
exclusively on the safety and security i ssues.  The TASA option reads as follows: 
"a) in the event that they are not satisfied th at the airline is under the effective regulatory 
control of the designating State". 
                                                     
 
373 The two are generally based on the same criterion.  See above. 
374 There are no significant differences between the bilateral TASA and the multilateral TASA in this 
regard. 
375 The other grounds for withholding, revocation and limitation of authorisation (related to compliance 
with safety and security provisions and the laws and regulations of the Party) are common to the traditional, 
transitional and full liberalisation approaches, and have thus not been reproduced. S/C/W/270/Add.2 
Page 412  
 
  688. The issue of the liberalisation of the SOEC provision was high on the agenda at ATConf/5.
376  
Opinions at the Conference varied greatly.  Air line representative groups IATA and its non-scheduled 
counterpart, the International Air Carrier Associ ation (IACA), argued in favour of liberalising 
ownership and control regulations , whereas labour unions, including th e International Federation of 
Airline Pilots’ Associations (IFALPA) and the In ternational Transport Workers’ Federation (ITF) 
argued strongly for retaining the status quo.  ICAO Contracting States were equally divided.377 
689. In spite of these differences, the participants at the Conference did support the formulation of 
a non-mandatory "Declaration of Global Principles for the Liberalisation of Air Transport", which includes a "Model Clause" on authorisation and designation.  
690. The Model Clause distinguishes between economic  and regulatory control.  On the economic 
side, it replaces the traditional SOEC requirement with  the concept of "principal place of business".  
On the regulatory side, it underlines the responsibilit y of the designating State for the exercise of 
regulatory control over the designated air carrier by requiring "effective regulatory control".
378   
691. Evidence of "principal place of business" is predicated, inter alia , upon establishment and 
incorporation of the airline in the designating Stat e, or the substantiality of the amount of operations 
and capital investment in that State.379  As for "effective regulatory control", this is demonstrated by, 
inter alia , the fact that the airline holds a valid opera ting licence or permit, such as an Air Operator 
Certificate, or the fact that the designating Pa rty has an maintains safety and security oversight 
programmes in compliance with ICAO standards.380 
692. The emphasis on a regulatory control criteri on is related to the concern about the 
establishment of "flags of convenience".  Under the Model Clause, the designation of a carrier which 
has its principal place of business in a third Contr acting State would not be permitted.  Under the 
proposed system, therefore, air carriers would not be able to "cherry pick" th e State with the cheapest 
safety, security and social costs as the State of d esignation.  If they did so, the carriers would be 
limited to operations from and to (and via, if fi fth freedom rights had been granted) that State.381 
693. The Conference agreed that the Model Clause should be used as an optional criterion.  
Moreover, it stressed that its use would not necessita te that Contracting States change their existing 
national investment/establishment re gimes.  Indeed, the Model Clause is intended to bring about a 
regime under which States that did not wish to liber alise foreign ownership of their domestic airline 
could do so whilst not inhibiting others from doing so.  In other words, the Model Clause would not 
affect a Contracting State's "internal ownership" regime (i.e. national regime on establishment/foreign 
investment in its airlines), but would liberalise th e "external ownership" side through a withholding 
policy that would authorise the bilateral partne r to designate a third-party owned carrier.  
694. Whilst the Model Clause, if universally adopted, would represent significant, though still 
imperfect382, progress towards progressive liberalisation of the SOEC withholding/designation 
provision, it still remains only an optional approach and nothing guarantees that all ICAO Contracting 
                                                      
376 For a fuller discussion of the deliberations  and outcome of ATConf/5, see Hörstke, S., op cit.  
377 See Höstke, S., op. cit.  
378 ICAO, "Report of the Worldwide Air Transport Conference:  Challenges and Opportunities of 
Liberalisation", Document 9819. 
379 ICAO Document 9819, ibid., para. 2.1.3.2. 
380 ICAO Document 9819, ibid. 
381 Hörstke, S., op cit. , page 52. 
382 It has been noted that even this criterion would impede full-scale mergers, for an airline could only 
operate from one single Contracting State, namely the State with which it maintains an economic as well as 
regulatory link.  A merger between two airlines would still require having to artificially separate the merged carrier, for instance by setting up a subsidiary in anothe r State and submitting this subsidiary to regulatory 
control of that second State.   (See Hörstke, op cit. , pages 47-48.)  S/C/W/270/Add.2 
 Page 413 
 
 
  States would act accordingly and thus largely rem ove the aero-political uncertainties for the parties 
involved in a merger, including the national governments concerned.383 
(b) Regional developments 
695. The single most important development at a regi onal level stems from the European Court of 
Justice "open skies" rulings of 2002 (see also sec tion I.A and Box 2).  Following these judgments, any 
bilateral agreement by an EC Member State which precludes the possibility to designate any other EC 
Member State-owned airline (i.e. because the withholding requirement is based on the principle that the airline has to be SOEC by nationals of the Me mber State in question) has become illegal under EC 
law.  As a result, all aviation agreements involvi ng an EC Member State will have to include a 
withholding provision based on the "Community clause". 
696. Under the "Community clause"
384, third parties have a right of revocation, suspension and 
withholding of authorisation if:  
• the airline is not established in the territory of an EC Member State; 
• the airline has not received an operati ng licence in accordance with European 
Community law; 
• effective regulatory control of the airline is not exercised and maintained by the 
European Community Member State res ponsible for issuing its Air Operators 
Certificate. 
697. It is worth noting that the concept of "establis hment" in the Community clause is different 
from the one of "principal place of business " in the ICAO Model Clause.  The ECJ has interpreted 
the meaning of "establishment" in a very broad wa y, pointing out that it could be any sort of 
established presence, such as a business, sales office or subsidiary.385  As a result, a carrier can only 
have one single principal place of business,  but it may have several establishments.386   
698. The longer-term implications of the ECJ judge ments became clear in September 2003, when 
Air France and KLM announced a proposed merger, which was accomplished in April 2004 following approval by the EC Commission's Competition Directorate.  The deal marked the start of the consolidation of European flag ca rriers.  It was followe d in July 2005, by Lufthansa's take-over of 
Swiss International Airlines. 
699. The withholding clauses contained in plurilateral agreements concluded since 2000 have been 
analysed in detail in the section of the present do cument devoted to plurilateral ASAs.  Overall, 
plurilateral agreements appear more liberal than  bilateral ones as the "community of interest" 
criterion, a logical corollary of plurilateralism, is very widespread, though not universal.   
(c) Bilateral developments 
700. The application of the QUASAR methodology to bilateral ASAs has revealed that SOEC 
withholding clauses are still largely prevalent in bilaterals.  As indicated in document 
S/C/W/270/Add.1 (page I.33, paragraph 61), SOEC clauses are found in around 90 per cent of 
                                                     
 
383 Van Fenema, H.P. (2001), 'Airline Ownership and Control: Long and Short-term Approaches to a 
Trade Barrier', in "European Air Law and Policy – Recent Developments", European Air Law Association 
Conference Papers, Vol. 17. 
384 See Commission Decision of 29 March 2005 on "Approving the standard clauses for inclusion in 
bilateral Air Service Agreements between Member St ates and third countries jointly laid down by the 
Commission and the Member States". 
385 European Court of Justice (2002), Commission of the European Communities vs. Kingdom of 
Denmark, C467/89, paragraph 131. 
386 Hörstke, S., op. cit.  S/C/W/270/Add.2 
Page 414  
 
  agreements, covering the same share of the WASA  traffic.  By comparison, principal place of 
business provisions are found in about 6 per cent of agreements (covering around 8 per cent of 
traffic), while community of interest clauses are f ound in less than 1 per cent of agreements (covering 
0.1 per cent of traffic).   
701. In preparation of the Fifth Worldwide Air Transport Conference, ICAO had drafted a 
questionnaire on designation and withholding po licies built around four questions, namely: 
• When designating a carrier to operate the rights granted in a bilateral ASA, does the 
Contracting State in question require the carrier  to be substantially owned and effectively 
controlled by nationals? 
 
• What are the criteria applied when accepting th e designation of foreign airlines?  Five 
standard criteria are envisaged:  substantial ownership and effective control;  community of 
interest;  principal place of business;  pr incipal place of business and effective control 
(PPOB&EC);  principal place of business and effective regulatory control (PPOB&ERC).   
 
• Would the Contracting State in question be willin g, in the future, to negotiate non-traditional 
ownership clauses for both its carriers and the carri ers of its bilateral partners, or only for the 
partner’s airlines?  
 
• Could the Contracting State in question envisage any positive action in regard to withholding 
and designation policies, such as developing a co mmon policy with aviation partners or taking 
unilateral action to liberalize through an individual statement of policy? 
702. Thus far, 54 Contracting States have provided detailed answers to the ICAO questionnaire.
387  
They are summarised in Table 53. 
Table 53 
Summary of responses to ICAO's 2003 questionna ire on withholding and designation policies 
Contracting 
State Summary of responses 
Argentina Argentina requires the airlines it designates to be nationally substantially owned and effectively 
controlled and imposes these obligations on the carriers of its bilateral partners.  
Bahrain There is no absolute requirement of domestic ownership and control for Bahrain-designated 
airlines.  SOEC or COI requirements are imposed  on carriers serving Bahrain, except for non-
scheduled and cargo carriers which need only m eet the PPOB&ERC criteria.   Bahrain is willing 
to liberalize the relevant provisions and to develop a common ACAC policy with Arab States.  
Brazil Brazil requires national ownership and control from its airlines and also from those of its 
bilateral partners, though COI is also possible.  No other clauses are agreed to and Brazil clearly stated that it would not be willing to alter its approach in the foreseeable future. 
Cameroon Cameroon stated that in designating its own carriers it applies the ownership and control 
criterion but alternatively, rather than cumula tively.  When dealing with third countries, 
Cameroon does sometimes impose SOEC criteria to  avoid flags of convenience but also accepts 
PPOB, PPOB&EC and PPOB&ERC criteria which favour the flow of capital.  Cameroon 
would be willing to accept any future criteria which favour economic e nhancement but always 
on a reciprocal basis.  It would further be interested in developing a common policy on a sub-regional framework. 
Cape Verde Cape Verde does not impose a condition of SOEC on its designated carriers but in practice the 
only airline providing services is fully State owned.  Where SOEC appears in Cape Verde 
bilaterals, this is on the request of the other pa rty;  Cape Verde favours any of the more liberal 
clauses.  Cape Verde aspires to further liberalize its bilateral agreements on  a reciprocal basis.  
It would consider unilateral and regional action to promote further liberalization. 
                                                      
387 The complete text of thes e answers is available at: 
http://www.icao.int/icao/en/atb/epm/Ecp/OwnershipControl.htm   S/C/W/270/Add.2 
 Page 415 
 
 
  Contracting 
State Summary of responses 
Central 
African 
Republic Airlines designated must meet SOEC criteria.  Airlines serving the Central African Republic 
may be subjected to any one of the standard bilateral conditions or even different terms as 
found in the relevant ASA.  Liberalization may be pursued reciprocally or only for the benefit 
of the airlines of partner States.  Conditions to such liberalization will be local representation and local bank guarantees.  A common policy may be agreed within the CEMAC Zone.  
Chile The only criterion for carriers to be  designated by Chile is that th e real place of business be in 
Chile.  The criteria of partner States will usually be  adopted with regards ai rlines to serve Chile.  
Further liberalization will be bilateral and based on reciprocal benefits.  
Colombia Colombia does not require its designated carrier s to be nationally owned and controlled;  the 
bilateral text will dictate which carriers are elig ible.  Colombia does have bilaterals with the 
SOEC criterion, but for members of the Andean Pact the PPOB&EC test is used and Colombia 
has accepted PPOB&ERC carriers to serve Colombia .  Further liberalization will insist on 
technical and operational control being in the designating State.  Colombia is willing to 
undertake multilateral liberalization such as by way of the Andean Pact and the ACS. 
Croatia Croatia had insisted on SOEC criteria both for its  airlines and those of foreign States;  however 
since ATConf/5, the PPOB&ERC test has been adopted.  Croatia will adhere to the common 
EU regulation by joining the ECAA. 
Cuba Cuba generally insists on SOEC for its carriers and those of partner States, although there are 
exceptions to the rule.  It is willing to liberalize these conditions on a reciprocal basis.  An airline designated by Cuba would have to be headquartered in Cuba an maintain close 
economic, business and fiscal links to Cuba.  Cuba is willing to develop a common policy 
within the ACS. 
Cyprus Cyprus requires its designated carriers to be nationally owned and controlled.  It has accepted 
PPOB and COI criteria under the EU regime.  Further anticipated liberalization is that 
undertaken jointly by the EU with third States rather than by Cyprus individually. 
Denmark Denmark does not require its designated carriers to be domestically owned and controlled.  
Foreign carriers serving Denmark can be exempted from SOEC  only where effective control is 
vested in the partner State.  Denmark is in favour  of further liberalization;  however, this will 
always be subject to assurance of responsibi lity and accountability with  regard to safety. 
Dominican 
Republic The Dominican Republic applies SOEC tests to both airlines designated by itself and by foreign 
States to serve its territory.  Although it does not rule out relaxing these rules for foreign 
carriers or developing a common policy with other States, it does underline that new civil 
aviation legislation does not foresee any alteration to the ownership and control provisions. 
Egypt Egypt subjects its carriers to the SOEC criterion.  It also applies this internationally but also 
accepts some COI carriers or those meeting an “o wnership and headquarters” test.  There is no 
indication of future liberalization. 
El Salvador For an airline to be designated by El Salvador it must be under its regulatory control.  Partner 
States airlines must be under the control of that  State.  No changes to this policy are expected 
unilaterally, bilaterally or multilaterally.  
Estonia Estonia-designated carriers must be nationally owned and controlled.  This criterion is also 
applied to foreign carriers, a lthough COI airlines are also accep ted and different rules apply 
within the EU.  Estonia was willing to consider  alternative requirements beginning with its 
accession to the EU. 
Finland Finland does not impose SOEC requirements on its carriers and is open to all bilateral 
ownership criteria for foreign airlines provid ed the foreign State accepts the EU standard 
designation clause.  It is open to further advancing ownership liberalization in bilateral and multilateral agreements and possibly through a unilateral policy statement. 
France Under EU jurisprudence, France was in the process of modifying its policy so as to eliminate 
SOEC requirements for its airlines.  France some times requires SOEC of foreign carriers but is 
open to negotiation on a case by case basis.  COI airlines from the Gulf and Africa serve France 
and the PPOB clause is included in its agr eement with Macao, China at Macao’s request.  
France would consider further liberalization wher e regulation is assured but major policy shifts 
are only envisaged in the framework of the EU.  S/C/W/270/Add.2 
Page 416  
 
  Contracting 
State Summary of responses 
Germany Germany’s approach to designation of its carri ers and acceptance of foreign carriers is done 
purely on a case by case basis according to the te rms of the relevant bilateral agreement.  The 
only clause which Germany indi cated would not be accepted is PPOB&ERC although to date it 
has no COI clauses in its agreements.  Although Germany is seeking to modify the provisions for the designation of its carriers to fall in line with Community law, it has no plans to further 
liberalize its requirements for foreign airlines, nor to develop a unilateral or multilateral policy 
of liberalization outside of the EU initiatives. 
Hong Kong, 
China Carriers designated by Hong Kong, China do not have to meet a SOEC test;  however foreign 
carriers are expected to meet this test to se rve Hong Kong, China.  No policy change is 
anticipated. 
Iceland Although Iceland requires its desi gnated airlines to be domestically owned and controlled, it is 
open to any other criteria with its bilateral part ners and will pursue this policy subject to there 
being clear indication of the responsibility for safety oversight.  Iceland will pursue a common 
aviation policy with the EU , EAA and EFTA States.  
India India routinely requires SOEC of its carriers and those designated to serve India under bilateral 
ASAs, with exceptions made for Gulf Air and SAS as COI carriers.  India has no plans to 
liberalize this nor to develop any alternative policies of its own or with partner States.  
Indonesia Indonesia requires its airlines to be owned and controlled by nationals.  Conditions for foreign 
carriers are negotiated individually and all of th e standard terms are possible, except for the 
single PPOB clause.  Through 2014 Indonesia will continue to liberalize ownership for partner 
airlines only and from 2015 also liberalize its requirements for designating Indonesian carriers.  
Future progress includes developing ASEAN and APEC policies, a possible unilateral policy statement and seeking broad harmonization of ownership and control regulatory regimes. 
Iran Iran indicated that it strictly requires national ownership and control of its carriers and those of 
partner States with no prospect of changing this policy. 
Italy Italy applies EU law and as such may designate any Community carrier.  Partner States’ airlines 
are typically subjected to SOEC criteria alt hough COI airlines may serve Italy and a PPOB 
criterion is exceptionally allowed in the case of Hong Kong, China.  Italy may be prepared to 
liberalize further on a case by case basis although  there are no major policy changes foreseen 
outside of the EU. 
Kuwait Kuwait requires its carriers to be domestically owned and controlled and typically requires this 
of foreign partners, although PPOB and COI terms can be specifically negotiated.  Kuwait 
always requires effective control and management to be in the designating State.  This criterion 
will also be used for future liberalization which will be on a case by case basis and subject to 
worldwide developments.  
Lesotho Lesotho requires its operators to be nationally owned and controlled although legislation is 
pending in the Parliament to liberalize in  the Yamoussoukro framework.  Lesotho accepts 
PPOB&ERC criteria for designation of airlines by bilateral partners.  
Lithuania Both Lithuanian airlines are State-owned, so the issue of domestic ownership policy has never 
been raised.  However from its accession in Ma y 2004, the Community ca rrier criterion will be 
applicable.  Lithuania will be guided by EU po licy in the future and w ill encourage the EU to 
adopt a flexible approach to ownership and control of third country airlines.  
Macao, 
China Carriers need not be domestically owned and cont rolled to be designated by Macao, China;  all 
of the standard bilateral clauses have been included in its negotiations.  Future liberalization 
will be sought on a reciprocal basis.  Unilateral and multilateral policies may be adopted. 
Malaysia Malaysian airlines must be domestically owned and controlled to be designated.  For foreign 
airlines, either SOEC or PPOB&ERC must be in th e designating State.  Future liberalization is 
possible in bilateral agreements on a case by case basis.  
Maldives Maldives-designated carriers must be nationally owned and controlled.  Pre-2002 ASAs 
required SOEC of foreign designated carriers serving Maldives, but PPOB&ERC is now 
offered to bilateral partners.  Maldives seeks to pursue this, while retaining SOEC domestically. 
Mexico Mexico requires minimum 75 per cent ownership and effective control for any carrier it 
designates and requires SOEC of  airlines designated by part ners.  There are no plans to 
liberalize and this is not permitted under Mexican legislation.  S/C/W/270/Add.2 
 Page 417 
 
 
  Contracting 
State Summary of responses 
Moldova SOEC is not required of Moldovan designated airlines.  SOEC is sometimes required of partner 
States’ airlines, this is not the case with EU  Member States, where Community carriers are 
accepted from all Member States.  Future change s will be on a case-by-case basis with a view 
to gradually liberalize with considera tion of the interest of all parties. 
Mozambique SOEC requirements should be fulfilled by carri ers designated by Mozambique and by its 
bilateral partners.  Future liberalization is not ruled out but no indication of the form of this was 
provided. 
Netherlands The Netherlands may designate carriers which m eet the Community carrier definition.  It 
generally accepts SOEC and COI airlines to serve its territory but also accepts all of the other 
terms on the basis of reciprocity.  Further bilateral liberalization will be on a case by case basis 
although a unilateral policy decision to promote liberalization may be taken and regional EU liberalization will be adopted. 
Norway SOEC is not required for a carrier to be designated by Norway.  Some agreements provide for 
SOEC, but Norway also considers requests for a lternative requirements with assurance safety 
and oversight always being a pre-requisite to non-traditional clauses.  Further reciprocal 
liberalization is possible provided safety is adequately ensured.  Liberalized unilateral and 
multilateral policy may be pursued. 
Pakistan Pakistan requires its carriers to be domestically owned and controlled.  The same requirement is 
not always made of foreign airlines: SOEC, PPOB, PPOB&ERC and PPOB&EC (only on one occasion) have been negotiated with different Stat es.  No departure from this policy is foreseen. 
Papua New 
Guinea Domestic airlines are required to be nationally owned and controlled, but a PPOB criterion is 
applied to foreign airlines serving Papua New Gu inea.  Reciprocal liberalization will be sought 
with a PPOB&EC criterion.  A joint policy with Pacific Island Countries is a future goal. 
Paraguay Domestic SOEC is required of both Paraguay and partner designated airlines.  Reciprocal 
liberalization and a unilateral policy change are possible in the future. 
Peru Peruvian designated airlines are required to be SOEC by nationals, although the minimum 
requirement to meet this is only 30 per cent.  PPOB&ERC is the test which foreign designated 
carriers must meet to serve Peru.  As Peruvian la w is very flexible, further liberalization will be 
pursued bilaterally on a case-by-case basis.  Common policy is sought with the Andean Pact 
and other potential partners to liberalization are being studied.  
Philippines Constitutionally, Filipino airlines must be domestical ly owned and controlled.  Generally this is 
also required of partner States’ airlines, although PPOB and COI criteria may be negotiated 
individually if circumstances require this.  Future liberalization will be limited to partner 
airlines.  Studies will be undertaken on unilateral or multilateral liberalization. 
Poland Airlines are required to be owned and controlled by nationals.  Foreign airlines may be 
subjected to SOEC or PPOB criteria to be allowed to serve Poland.  Further developments will 
be in the framework of EU policy.  
Portugal Portugal-designated carriers are subject to the Community carrier  principle only.  All of the 
standard bilateral designation clauses may be negotiated by Partner States for their airlines to serve Portugal.  Air Afrique was an instance of a COI carrier.  Future bilaterals must include 
the Community carrier clause and liberalization for partner States will be negotiated 
individually.  Safety and oversight are the primary concerns in accepting liberal terms.  Extensive common EU policy is anticipated.  
Republic of 
Korea SOEC is required of Republic of Korea-designate d airlines and this is usually the case of 
airlines designated by bilateral partners;  exceptions are made for COI carriers SAS and Gulf 
Air.  No other terms are possible and no policy shift is foreseen. 
Romania Romania requires its carriers to be domestically owned and controlled and this is usually also 
required of airlines designated by other States .  An exception is made for COI airlines and 
specifically for SAS.  Changes ar e expected, particularly upon membership of the EU, however 
PPOB&ERC may be adopted in bilateral agreements. 
Russian 
Federation National SOEC is required of carriers designated by the Russian Federation and by its partner 
States.  No plans to change this policy exists. 
Singapore Singapore carriers are subject to SO EC requirements.  This is for the practical reason that most 
ASAs contain SOEC provisions .  Singapore is actively seeking to replace these with 
PPOB&EC criteria.  Unilateral or multilateral policy statements would be unusual for 
Singapore but not impossible if circumstances require this. S/C/W/270/Add.2 
Page 418  
 
  Contracting 
State Summary of responses 
Slovak 
Republic Slovak airlines were required to be domestically owned and controlled, but this has been 
overwritten upon EU membership.  Bilateral agreements differ on the criteria for the 
requirements of carriers to serve the Slovak Republic:  SOEC, COI, PPOB or PPOB&ERC 
tests may be applied to Partner States’ airlines .  PPOB&ERC will be sought in future bilateral 
agreement on a reciprocal basis only.  The Slova k Republic has adopted EU policy and is open 
to developing a common transatlantic policy as well as within the EU and the ECAA. 
Slovenia Airlines designated by Slovenia must be substantially owned and controlled by Slovenians.  
Criteria for foreign airlines are negotiated on an  individual basis.  Different clauses can be 
found in the relevant bilateral agreements.  Future changes will be conform to EU policy. 
Suriname National SOEC is required of Surinamese carriers due to a 2002 Law on Safety and Security.  
Foreign airlines serving Suriname may be subjected to SOEC, PPOB or PPOB&ERC tests.  Domestic law will need to be altered for further liberalization to occur as Suriname wishes to 
ensure equal opportunity for its airlines.  If the relevant Act is amended, Suriname will seek 
further liberalization bilaterally. 
Sweden Swedish designations are subject only to the Co mmunity carrier principle.  Foreign airlines 
serving Sweden are required to meet SOEC or PPOB&ERC criteria.  Safety is the principal 
consideration in ongoing liberalization of bila teral arrangements.  Unilateral, bilateral and 
multilateral policy shifts are foreseen. 
Switzerland Swiss carriers must be nationally owned and controlled.  Requirements of foreign carriers 
serving Switzerland diverge and can be found in the ASAs.  All of the standard clauses have 
been accepted by Switzerland.  Fu ture liberalization will be soug ht on a reciprocal basis and 
multilateral policy may be sough with like-minded countries.  
Tanzania National ownership and control principles apply to Tanzania-designated carriers, but all of the 
standard bilateral clauses may be negotiated by partner States for the airlines to be designated.  
Future bilateral liberalization will be sought on a reciprocal basis, subject to the condition of 
incorporation in the designating State with fis cal obligation owed in th at State and employees 
and management coming there from.  A unilateral shift of policy is possible. 
Ukraine Ukraine-designated carriers must be nationally owned and controlled, as should foreign carriers 
serving the Ukraine, with an exception made for CO I carriers.  Unilateral or  reciprocal bilateral 
policy changes are possible. 
United 
Kingdom Designation of carriers by the UK is based on EU carrier principles.  SOEC and PPOB&ERC 
are the preferred criteria for airlin es designated by Partner States  although COI carriers are also 
accepted.  The PPOB&ERC test is sought as the pr eferred clause in future bilateral agreements. 
 
Note: Most of these answers date back from 2003 and therefore may not always reflect the current legislative 
situation. 
Source :  ICAO, as summarised by the WTO Secretariat. 
 
Members may be willing to correct, update or compleme nt the information contained in Table 53. 
703. One new concept has rece ntly emerged in the specialized pr ess and literature with regard to 
withholding regimes, that of the "blind eye policy".  This is a deliberate unilateral withholding policy 
by which a Contracting State does not use its withholdi ng right and is indifferent to the question of the 
ultimate ownership of the foreign airline, so long  as this airline complies with safety and security 
regulations.  
704. Canada is said to be considering such a policy. 388  Some commentators have also, probably 
hastily, qualified the national investment regime pr ovision of the recently concluded First Phase US-
EU agreement of "blind eye policy", notably for th e provision relating to the takeover by European 
carriers of African airlines flying to the Unite d States (Article II:2 of Annex 4 of the US-EU 
Agreement).389 
                                                      
388  Airline Business, March 2007.  
389 For the complete text of this provision, se e Box 1 of the profile of the US-EU Agreement.  S/C/W/270/Add.2 
 Page 419 
 
 
  (ii) Regulatory developments with regard to national investment/establishment regimes 
705. As explained in the section on documentary lim itations, the efforts by IATA and ICAO to 
create a complete inventory of national investmen t/establishment regimes have been interrupted.  
However, by making use of various sources, the Secretariat has identified a limited number of changes in national investment regimes since the is suance of the documentation of the first review.  
These changes are listed in Table 54. S/C/W/270/Add.2 
Page 420  
 
  Table 54 
National investment/establishment regimes changed or clarified since 2000 
WTO Member Investment regime Comments 
Canada Creation of two classes of 
voting shares with 
differentiated voting rights 
according to the nationality of 
the shareholder. Division of shares in two classes, one for Canadian one for 
foreigners.  If foreign shares exceed 25% of the voting shares, the 
vote attached to each foreign share decreases so that total vote by 
all foreign shareholders can neve r exceed Canada's 25% cap on 
foreign control of an airline. 
China 35% (25% voting). No reported changes since the first review.  However, the rule also 
applies to non-mainland holdings i. e. Hong Kong and Macao.  This 
is relevant due to the increasing ties between Cathay Pacific and 
Air China, whereby the former has a 20 per cent interest in the 
latter and the latter holds a 17.5 per cent interest in the former.  The 
Director must also be from the mainland. 
Chinese Taipei 49.9 % 
25% for individual foreign 
shareholder. Up from 33%. 
Colombia No formal restriction No aviation specific legislation. Previous law requiring that 
Colombian companies must be 60 per cent domestically owned has been overruled and declared i noperative. However Columbian 
Civil Aviation authorities (Aerocivil) still deem a 51 per cent rule 
to apply given that their bilate ral all provide for substantive 
ownership and effective control. 
Hong Kong, 
China No restriction. Hong Kong registered airlines are required only to be established 
and have their principal place of business in the territory. 
India Generally 40%. Air India may have a strategic partner take up to 40 percent 
shareholding and 26 per cent of the equity may be foreign. A 
foreign airline participation is allowed. For Indian Airlines, a 
strategic partner may hold up to 26 per cent of its shares and a 
foreign partner may hold up to 40 per cent in this partner but may not be an airline. For private airlines foreign equity is limited to 40 
per cent and airlines are excluded from direct or indirect 
participation. 
Israel 34% This rule is accompanied by requirements that the Chairman, 
Directors and principal place of  business be in Israel. No 
distinction is made be tween airline and non-ai rline participation. 
Malaysia 30% Clarifying the previous review, the general rule for airlines to be 
considered Malaysian is fixed at a 30 per cent cap. The law has 
increased this to 45 per cent excl usively in favour of Malaysian 
Airlines. No foreign airline may own more than 20 per cent and the 
government retains at all time s a golden share in Malaysian 
Airlines.  
Mauritius 40% Foreign interest may not exceed 40 per cent of share capital. No 
distinction is applied to airlines. There is no formal restriction on 
control by foreigners, however this is implied due to the bilateral 
terms and the fact that to qualify for assistance from the UN 
Economic Commission for Africa, an airline must be controlled by 
the national government.  
New Zealand 49% The general rules remain the same as in 2001. However, 
interestingly, in the case of a domestic carrier, no limit is placed on 
foreign ownership. 
Peru 49% Law 27.261 (Civil Aeronautical Law)  still requires a 49 per cent 
limit; however national law allows for exceptions. 
Singapore No restriction Internal rules of Singapore Airlines allow the Directors to set a 
limit for foreign investment however  this has not been done.  No 
shareholder, foreign or domestic may hold more than 5 per cent 
shareholdings without the assent of Directors. The Ministry of 
Finance has a mechanism to buy shares if air service is threatened 
due to the level of foreign participation. 
Viet Nam 49% 
(30% for individual foreign 
investors) The first beneficiary of this measure wa s QANTAS, who acquired 
a share in low-cost carrier Pacific Airline, which was formerly 
State-owned.  
 
Source : ICAO, IATA and issues of Airline Busine ss, as compiled by the WTO Secretariat.  S/C/W/270/Add.2 
 Page 421 
 
 
  Members may wish to correct, update or complement the limited information contained in Table 54 
(iii) Regulatory aspects with regard to privatisation 
706. ICAO has ceased to follow in detail developments in privatisation processes since the 
discontinuation of its annual publication, "The World of Civil Aviation".   
707. Table 55 contains the surprisingly few airlines wh ich, by the end of the period under review, 
were more than 80 per cent government-owned.    
Table 55 
Airlines more than 80 per cent government-owned, September 2006 
Airline Contracting State Governmental 
share 
Aer Lingus Ireland 85.1% 
Air Algérie Algeria 100% 
Air Jamaica Jamaica 100% 
Air Malta Malta 98% 
Air India India  100% 
Egypt Air Egypt 100% 
Emirates United Arab Emirates 100% 
Ethiopian Airlines Ethiopia 100% 
Garuda Indonesia 100% 
Gulf Air Bahrain (50%), Oman (50%) 100% 
Iran Air Islamic Republic of Iran 100% 
Kuwait Airways Kuwait 100% 
Malev Hungary 97% 
Pakistan International Airlines Pakistan 87% 
Royal Brunei Airlines Brunei Darussalam 100% 
Royal Jordanian Jordan 100% 
Uzbekistan Airways Uzbekistan 100% 
Viet Nam Airlines Viet Nam 100% 
 
Source : Airline Business, September 2006 
708. During the period under review, there have also been instances, albeit rare ones, in which 
airlines have been re-nationalised following th e demise of private shareholders.  The re-
nationalisation of Air Jamaica in 2004 after nine years of private ownership is a case in point.   
2. Commercial and economic developments 
(a) Main developments in the ownership structure of airlines 
709. The Secretariat has gathered information on deve lopments in the ownership structure of the 
world's major scheduled airlines from the annual re ports on the ownership of airlines published by 
Airline Business (see Table 56).  This information is not exhaustive, since most charter/leisure 
carriers, regional airlines and low-cost carriers are ab sent.  Still, to the Secretariat's knowledge, it is by 
far the best set of data available. 
710. Time constraints have not allowed the Secretariat to refine the data as much as it would have 
liked to.  That is why Table 56 does not always allo w for a complete overview of developments in the 
ownership structure of airlines.  
Members may be willing to correct, update or compleme nt the information contained in Table 56. S/C/W/270/Add.2 
Page 422  
 
  Table 56 
Developments in the ownership structure of th e world's main scheduled passenger airlines, 
2002-2006 
 
Airline 2002 2003 2004 2005 2006 
Algeria  
AIR ALGERIE 100% Gvt. 
Owned Unchanged Unreported Unchanged Unchanged 
Angola  
TAAG ANGOLA 
AIRLINES 100% Gvt. 
Owned Unchanged Unreported Unreported Unreported 
Argentina  
AEROLINEAS 
ARGENTINAS 92% Marsans 
Group 92% Marsans 
Group 
5% Gvt. owned 
3% Employees Unchanged Unchanged Unchanged 
AUSTRAL 
LINEAS AEREAS 90% Interinvest Unchanged Unchanged Unchanged Unreported 
DINAR LINEAS 
AEREAS 95% Desimone 
family 
5% Miguel Scadi 100% 
American 
Falcon Unreported Unreported Unreported 
Australia  
QANTAS 78.5% Publicly 
traded 
21.5% British 
Airways 81.07% 
Publicly traded 
18.93% British 
Airways 81.75% 
Publicly traded 
18.25% British 
Airways 100% Publicly 
traded 100% 
Publicly 
traded 
VIRGIN BLUE Unreported Unreported 50% Patrick 
Corp. 
25.1% Virgin Group 
24.9% Private 
investors 62.42% Patrick 
Corp.  
25.26% Virgin Group 
12.34% Private 
Investors Unchanged 
Austria  
AUSTRIAN 
AIRLINES Unreported 100% Austrian 
Airlines Group 100% Austrian 
Airlines Group 
1.5% Air 
France 43.5% Floating 
stock 
39.7% OIAG 
10.3% Austrian Institutional 
Investors 
5% Austrian Airlines Group 
1.5% Air France Unchanged 
LAUDA 
AIRLINES 100% Austrian 
Airlines Unchanged Unchanged Unreported Unreported 
Azerbaijan  
AZERBAIJAN 
AIRLINES 100% Gvt. 
Owned Unreported Unreported Unreported Unreported 
Bangladesh 
BIMAN 
AIRLINES Unreported 100% Gvt. 
Owned Unchanged Unchanged Unreported 
Belarus  
BELAVIA 
AIRLINES Unreported 100% Gvt. 
Owned Unreported Unreported Unreported 
Belgium  
SN BRUSSELS 
AIRLINES 100% Airholding 72% 
Airholding 
22% SIC  92% SN 
Airholding 
8% SIC Unchanged Unreported  S/C/W/270/Add.2 
 Page 423 
 
 
  Airline 2002 2003 2004 2005 2006 
VIRGIN EXPRESS Unreported Unreported 88.6% Virgin 
Sky 
Investment 11.4% Public 
shareholders 100% SN Air 
Holding Unreported 
Bolivia  
AEROSUR 100% Private 
Bolivian 
investors Unchanged Unreported Unreported Unreported 
Brazil  
GOL Unreported Unreported Unreported 77% Aeropar 
17.6% Venture 5.4% American 
International 
Group Unreported 
TAM LINHAS 
AEREAS Unreported Unreported 69% Amaro 
family 
22% Banca 
Garantia Funds 
7% Other Unchanged 54.7% Amaro 
family and 
TEP 
45.3% Others 
VARIG 55.63% Ruben 
Berta Foundation 0.43% State of 
Rio Grande do 
Sul Unchanged Unchanged Unchanged 100% Varig 
Log 
Brunei  
ROYAL BRUNEI 
AIRLINES 100% Gvt. 
Owned Unchanged Unchanged Unchanged Unchanged 
Bulgaria  
BULGARIAN AIR Unreported 100% Gvt. 
Owned Unreported Unreported Unreported 
BALKAN 
BULGARIAN 75% Zeevi 
Group 
25% Gvt. Owned Unreported Unreported Unreported Unreported 
Cameroon  
CAMEROON 
AIRLINES 3.56% Air France Unreported Unreported Unreported Unreported 
Canada  
AIR CANADA 100% Publicly 
owned 70% 
Institutions 
19% Retail 
11% employees Unchanged 100% ACE 
Aviation 
Holdings Unchanged 
Cayman Islands  
CAYMAN 
AIRWAYS 100% Gvt. 
Owned Unreported Unreported Unreported Unreported 
Chile  
LAN CHILE 38.7% Cueto 
family 33.2% Pinera 
Group 
16% Hirmas Geblen Group 32.3% Cueto 
family 37.7% Pinera 
Group 
23.7% Hirmas Geblen 31.8% Cueto 
family 26.8% Pinera 
Group 
18.2% Hirmas Geblen 27.8% Cueto 
family 28.2% Pinera 
Group 
17.2% Hirmas Geblen Unchanged 
LAN EXPRESS Unreported 99.4% LAN  Unchanged Unchanged Unchanged S/C/W/270/Add.2 
Page 424  
 
  Airline 2002 2003 2004 2005 2006 
China  
AIR CHINA 100% Gvt. 
Owned (CNAC) Unchanged 100% Air 
China Group 69% CNAC  
21% Public float 
10% Cathay Pacific 24.2% Public 
float 
20% Cathay Pacific 
CHINA AIRLINES 71.62% China 
Aviation 
Development 
Foundation Unchanged 70.02% China 
Aviation 
Development 
Fund Unchanged Unchanged 
CHINA EASTERN 
AIRLINES 61.64% Gvt. 
Owned 32.19% Publicly 
held H shares 
6.17% Publicly held A shares 
 Unchanged 
 Unchanged 61.64% China 
Eastern Air Holding 
Corporation 
32.20% Publicly held H shares 
6.18% Publicly 
held A shares 32.20% 
Publicly held H shares 
6.18% 
Publicly held A shares 
CHINA NORTHERN 100% Gvt. 
Owned Unreported Unreported Unreported Unreported 
CHINA 
SOUTHERN 62.5% Southern 
Airlines Group Unchanged 50.3% China 
Southern Air 
Holding Group Unchanged 50.3% China 
Southern Air 
Holding Group 
26.84% Hong 
Kong & non-PRC 
shareholders 
(H shares) 
22.84% PRC 
private investors (A 
shares) 
HAINAN 
AIRLINES Unreported Unreported 7.31% HNA 
Holding 7.28% Hainan 
Qixing 
Industrial Investment 
4.55% China 
Everbright Group 
2.37% 
Administration of Hainan 
14.8% 
American Aviation  
0.89% Hainan 
Bank of 
Communicat. 
0.89% China International 
Travel Agency 
0.59% Beijing Fieldtrade 
Corp. 
0.44% China Industrial 
Trust Hainan Unchanged 14.8% 
American Aviation LDC 
11.85% HNA 
Holding 6.83% Hainan 
Qixing 
Industrial Investment 
2.37% Hainan 
Jincheng State Property 
Administratio
n Company  S/C/W/270/Add.2 
 Page 425 
 
 
  Airline 2002 2003 2004 2005 2006 
0.41% China 
Education 
Trust Inv. 60.47% Other 
shareholders  
SHANGHAI 
AIRLINES 75% Shanghai 
Airlines 
25% Public 
Holders 75% Chinese 
Government 
Owned 
25% Public Holders 44.69% 
Publicly held 
40.66% 
Alliance Investment 
14.65% Bank 
of China Unchanged Unchanged 
XIAMEN 
AIRLINES Unreported Unreported Unreported 60% China 
Southern 
40% Xiamen 
Construction & Development 
Corp.  Unchanged 
YUNNAN 
AIRLINES 100% CAAC Unreported Unreported Unreported Unreported 
Chinese Taipei  
EVA AIR 25.33% 
Evergreen 
Marine Corp. 
13.5% Evergreen International 
Corp. Unchanged 22.74% 
Evergreen 
Marine Corp. 
12.37% Evergreen 
International 
Corp. Unchanged Unchanged 
UNIAIR Unreported Unreported Unreported 17.92% EVA 
Air 
17.02% Evergreen 
Development 
Corp. Unreported 
Colombia  
ACES 
COLOMBIA 50% Grupo 
Valores 
Columbia 
25% Compania de Inversiones de 
la Flota Mercante 
23% Federacion Nacional de 
Cafeteros 
2% Other shareholders Unreported Unreported Unreported Unreported 
AVIANCA  50% Federacion 
Nacional de 
Cafeteros 
43.73% Grupo 
Valores Bavaria 6.14% Versiones 
Fenicia 50% 
Federacion 
Nacional de 
Cafeteros 
43.73% Grupo Valores 
Bavaria 
6.14% Versiones 
Fenicia 
5% Helicol 50% 
Federacion 
Nacional de 
Cafeteros 
43.73% Grupo Valores 
Bavaria 
6.14% Versiones 
Fenicia 
4.77% Helicol 0.13% Other 
investors 75% Synergy 
Group  
 100% 
Synergy 
Group S/C/W/270/Add.2 
Page 426  
 
  Airline 2002 2003 2004 2005 2006 
ALIANZA 
SUMMA Unreported 50% Grupo 
Valores 
Bavaria 25% Compania 
de Inversiones 
de la Flota 
Mercante 
23% Federacion 
Nacional de 
Cafeteros 2% Other 
shareholders Unreported Unreported Unreported 
Costa Rica  
LACSA 86.98% 
Individual shareholders 
10% TACA 
3.02% Employees Unchanged Unchanged Unreported Unchanged 
Croatia  
CROATIA 
AIRLINES 90.6% Gvt. 
Owned 
3.4% State Agency for 
Deposit 
Insurance and 
Bank 
Rehabilitation 2.6% Croat 
Privatization 
Fund 2.0% Others 
1.6% Private 
individuals 91.6% Gvt. 
Owned 
3.0% State Agency for 
Deposit 
Insurance and 
Bank 
Rehabilitation 2.1% Croat 
Privatization 
Fund 3.3% Other 94.1% Gvt. 
Owned 
2.4% State Agency for 
Deposit 
Insurance and 
Bank 
Rehabilitation 1.6% Croat 
Privatization 
Fund 1.9% Other Unreported Unreported 
Cuba  
CUBANA 100% Gvt. 
Owned 100% 
Corporacion 
Cubana de 
Avaicion SA Unchanged Unreported Unchanged 
Cyprus  
CYPRUS 
AIRWAYS 69.62 Gvt. 
Owned 
30.38% Other 
investors Unchanged 100% Cyprus 
Airways 
Group 69.62% Gvt. 
Owned 
30.38% Other 
investors Unchanged 
Czech Republic  
CSA CZECH 
AIRLINES 56.43% Czech 
National Property 
Fund 34.49% Czech 
Consolidation 
Bank 4.33% Czech 
Insurance 
Company 56% Czech 
National 
Property Fund 34% Czech 
Consolidation 
Bank 4% Czech 
Insurance 
Company 3.92% 
Municipality 56.43% Czech 
National 
Property Fund 34.49% Czech 
Consolidation 
Bank 4.33% Czech 
Insurance 
Company 3.92% 
Municipality 
0.49% Endowment 56.43% Czech 
National 
Property Fund 34.49% Czech 
Consolidation 
Bank 4.33% Ceska 
Pojistovna 
2.94% City of Prague 
0.98% City of 
Bratislava 0.49% 56.92% 
Ministry of 
Finance of Czech 
Republic 
34.59% Czech 
Consolidation 
Bank 4.33% Ceska 
Pojistovna 
2.94% City of Prague  S/C/W/270/Add.2 
 Page 427 
 
 
  Airline 2002 2003 2004 2005 2006 
fund 
0.24% Fund of 
National Property of 
Slovak 
Republic Endowment fund 
0.24% Fund of 
National Property of 
Slovak Republic 0.98% City of 
Bratislava 
0.24% Fund of National 
Property of 
Slovak 
Republic 
Denmark  
MAERSK AIR 100% A P Moller 
Group Denmark Unchanged Unchanged 100% Fons 
Eignarhaldsfelag Unreported 
Egypt  
EGYPT AIR 100% Gvt. 
Owned Unchanged Unchanged Unchanged Unchanged 
El Salvador  
TACA Unreported Unreported Unreported 100% Grupo 
TACA Unchanged 
Estonia  
AERO AIRLINES Unreported 51% Aero 
Holding 49% Finnair Unreported Unreported Unreported 
ESTONIAN AIR 49% Maersk Air 
34% Gvt. Owned 
17% Baltic Cresco 
Investment 
Group Unchanged Unreported Unreported Unreported 
Ethiopia  
ETHIOPIAN 
AIRLINES Unreported Unreported 100% Gvt. 
Owned Unchanged Unchanged 
Fiji 
AIR PACIFIC 51% Gvt. Owned 
(Fiji) 46% Qantas 
2% Air New 
Zealand Governments of 
Kiribati, Tonga, 
Nauru, Western Samoa Unchanged 51% Gvt. 
Owned (Fiji) 46% Qantas 
1% 
Governments of Kiribati, 
Tonga, Nauru, 
Western Samoa 51% Gvt. 
Owned (Fiji) 46.3% Qantas 
1.94% Air New 
Zealand 0.27% Gvt. of 
Kiribati, 0.27% 
Gvt. of Tonga, 0.12% Gvt. of 
Samoa 
0.08% Gvt. of Nauru 51% Gvt. 
Owned (Fiji) 46.3% Qantas 
3.67% Air 
New Zealand 0.27% Gvt. of 
Kiribati, 
0.27% Gvt. of Tonga, 0.12% 
Gvt. of 
Samoa 0.08% Gvt. of 
Nauru 
Finland  
FINNAIR 58.43% Gvt. 
Owned 9.84% Odin 
Forvaltning 
31.19% Others Unchanged 58.43% Gvt. 
Owned 4.74% Odin 
Forvaltning 
3.44% Tapiola 
Group 
31.41% Others 58.42% Gvt. 
Owned 6.2% Burdaras 
4.73% Odin 
Forvaltning 
3.44% Tapiola 
Group 1.69% Pohjola 
Group 
1.18% Local Government 
Pension 
Institution 24.35% Others  57.04% Gvt. 
Owned 10% FL 
Group 
5.82% 
Burdaras 
3% Odin Forvaltning 
1.76% 
Tapiola Group 
6.12% Other 
shareholders S/C/W/270/Add.2 
Page 428  
 
  Airline 2002 2003 2004 2005 2006 
France  
AIR AUSTRAL 37.72% Sematra 
36.01% Air 
France 26.3% French 
banks Unchanged 37.72% 
Sematra 
33.36% Air France 
26.3% French 
banks 37.72% Sematra 
30.36% Air 
France 26.3% French 
banks 37.72% 
Sematra 
26.3% French banks 
AIR CALEDONIE 83% Gvt. Of 
New Caledonia 
owned 6% BCI 
6% Sofrana 
Unilines 1% Leroux 
Group Unchanged Unreported Unreported Unreported 
AIR FRANCE 56% Gvt. Owned 
33% Publicly held 
11% Employees 55.9% Gvt. 
Owned 31% Publicly 
held 
11.1% Employees 
2% Alitalia 100% Air 
France KLM Group Unchanged Unchanged 
AIR LIB 100% Holco Unreported Unreported Unreported Unreported 
French Polynesia  
AIR TAHITI NUI Unreported 57.89 Gvt. 
Owned 0.88% Socredo 
Bank 
5.95% Tahiti 
Tourisme 
4.26% small shareholders 
10.07% SEGC 
10% Air Tahiti Unreported 61.43% Gvt. 
Owned 9.07% SEGC 
8.9% Socredo 
Bank 
8.14% Air Tahiti 
5.82% Tahiti Tourisme 
1.62% Wan 
Holding 5.02% Others 61.7% Gvt. 
Owned 8.8% SEGC 
8.7% Socredo 
Bank 
7.9% Air 
Tahiti 5.9% Tahiti 
Tourisme 
1.6% Wan Holding 
5.4% Others 
Germany  
AIR BERLIN Unreported Unreported Unreported 61.86% 
Freefloat 9.44% Rngerike 
9.08% Hans 
Joachim Knieps 5.45% Werner 
Huehn 
4.54% Severin  Schulte 
4.45% Rudolf 
Schulte 
3.4% Joachim 
Hunold 1.45% Johannes 
Zurnieden 
0.24% Others Unreported 
DEUTSCHE BA 100% British 
Airways Unchanged Unreported Unreported Unreported 
HAPAGFLY Unreported Unreported Unreported Unreported 100% TUI  S/C/W/270/Add.2 
 Page 429 
 
 
  Airline 2002 2003 2004 2005 2006 
LTU 
INTERNATIONAL 
AIRWAYS Unreported Unreported Unreported 49.9% VBE 
Beteiligungsgese
llschaft 40% Rewe 
Touristik 
10.1% CKA Unreported 
LUFTHANSA 100% Publicly 
Owned Unreported Unreported 88.52% Private 
Investors 
10.05% MGL  1.03% Deutsche 
Postbank 
0.4% Deutsche Bank 100% 
Lufthansa 
Group 
Ghana  
GHANA 
AIRWAYS 100% Gvt. 
Owned Unchanged Unreported Unreported Unreported 
Greece  
AEGEAN 
AIRLINES Unreported Unreported Unreported 45.2% Th. 
Vassilakis Group 25.3% 
Laskaridis 
Group 8.3% 
Konstantakopoul
ou Group 8.1% Joannou 
Group 
6.3% David 
Group 
5.9% Piraeus Bank 
0.9? Others Unchanged 
OLYMPIC 
AIRLINES 100% Gvt. 
Owned Unchanged Unchanged Unchanged Unchanged 
Guatemala  
AVIATECA 30% TACA 
International 
Airlines Unchanged Unreported Unreported Unreported 
Gulf States (Bahrain, Oman)  
GULF AIR Unreported 33.3% Gvt. of 
Abu Dhabi 33.3% Gvt. of 
Bahrain 
33.3% Sultanate of 
Oman Unchanged Unchanged 50% Gvt. of 
Bahrain 50% 
Sultanate of 
Oman 
Hong Kong, China  
CATHAY 
PACIFIC 45.11% Swire 
Group 
25.4% Citic 
Pacific (Chinese Gvt.) Unchanged Unchanged Unchanged 40% Swire 
group 
25% Public 
shareholders 17.5% Citic 
Pacific 
10.2% Air China 
DRAGONAIR 43.29% China 
National 
Aviation 43.29% China 
National 
Aviation 43.29% China 
National 
Aviation Unchanged Unchanged S/C/W/270/Add.2 
Page 430  
 
  Airline 2002 2003 2004 2005 2006 
Company 
28.49% CITIC 
Pacific 17.79% Cathay 
Pacific  
7.71% Swire 
Group Company 
29.35% CITIC 
Pacific 17.79% Cathay 
Pacific  
7.71% Swire 
Group 
1.86% Other shareholders Company 
28.5% CITIC 
Pacific 17.79% 
Cathay Pacific  
7.71% Swire 
Group 
2.71% Other shareholders 
Hungary  
MALEV 97% Gvt. Owned 
0.528% 
Municipalities 0.524% 
Employees Unchanged Unchanged Unchanged Unchanged 
MALEV EXPRESS Unreported 100% Malev Unchanged Unreported Unreported 
Iceland  
ICELANDAIR 100% Privately 
owned Unchanged 100% 
Flugleidir Iceland Air 
Group FL Group Unreported 
STERLING 
AIRLINES Unreported Unreported Unreported Unreported 100% FL 
Group 
India  
AIR INDIA 100% Gvt. 
Owned Unchanged Unchanged Unchanged Unchanged 
INDIAN 
AIRLINES 100% Gvt. 
Owned (via 
holding 
company) Unchanged Unchanged Unchanged Unchanged 
Indonesia  
BOURAQ 
INDONESIA AIRLINES 100% Sumendap 
family Unchanged Unreported Unreported Unreported 
GARUDA 
INDONESIA 100% Gvt. 
Owned Unchanged Unchanged Unchanged Unchanged 
MERPATI 
NUSANTARA 9.5% Garuda 6.8% Garuda 93.2% Gvt. 
Owned 6.8% Garuda Unreported Unreported 
Iran  
IRAN AIR 100% Gvt. 
Owned Unchanged Unchanged Unchanged Unchanged 
Ireland  
AER LINGUS 95% Gvt. Owned 
5% Employees Unchanged Unchanged 85.1% Gvt. 
Owned 14.9% 
Employees Unchanged 
Israel  
EL AL AIRLINES 
 100% Gvt. 
Owned Unchanged 51% Publicly 
held 
49% Gvt. 
Owned 40% Knafaim-
Arkia Holdings 
30%  Private 
20% Gvt. Owned 
10% Employees 39.49% 
Knafaim-
Arkia 
Holdings 31.36%  
Private 
21.03% Gvt. Owned 
8.12% 
Employees  S/C/W/270/Add.2 
 Page 431 
 
 
  Airline 2002 2003 2004 2005 2006 
Italy  
AIR EUROPE 100% Volare 
Group Unchanged Unreported Unreported Unreported 
AIR ONE 99% Toto Unchanged Unchanged Unchanged Unchanged 
ALITALIA 53% Gvt. Owned 
27% Other 
Shareholders 
20% Employees Unchanged 62.4% Gvt. 
Owned 
35.6% Other 
shareholders inc. employees 
2% Air France Unchanged 49.9% Gvt. 
Owned 
35.7% Other 
shareholders inc. 
employees 
8.2% Walter Capital 
Management 
4.2% Newton Investment 
Management 
2% Air France  
MERIDIANA 57.19% 
Interprogramme 
Hldg 4.51% AIRFIN 
17.59% HH The 
Aga Khan 16.42% 
Employees 57.19% 
Interprogramm
e Hldg 4.51% AIRFIN 
3.39% 
Fondazione Cariplo  
17.59% HH 
The Aga Khan 
16.08% 
Employees 1.24% Other 
shareholders Unreported Unreported Unreported 
Jamaica  
AIR JAMAICA 70% Air Jamaica 
Acquisition Group 
25% Gvt. Owned 
5% Employees Unchanged Unreported 100% Gvt. 
Owned Unchanged 
Japan  
AIR JAPAN 95% All Nippon 
Airways 
5% Air Nippon 78% All 
Nippon 
Airways 
17% ANA Group 17% ANA 
Group 
10% All 
Nippon Airways Unreported Unreported 
AIR NIPPON 75.5% All 
Nippon Airways 
14% Hokkaido PC 99.5% All 
Nippon 
Airways 0.5% Air Do Unchanged Unreported Unreported 
ALL NIPPON 
AIRWAYS Unreported 100% ANA 
Group Unreported Unchanged Unchanged 
JAPAN AIR 
SYSTEM 8.25% Japan 
Airlines Unchanged Unreported Unreported Unreported S/C/W/270/Add.2 
Page 432  
 
  Airline 2002 2003 2004 2005 2006 
JAPAN AIRLINES 100% Publicly 
listed 4.47% Mizhou 
Financial 
Group 4.06% Tokyu 
Corporation 
3.13% Eitaro 
Itoyama 
2.79% Tokyo Marine & Fire 
Insurance Co. 
2.27% Nissay Dowa Mutual 
Life Insurance 
Co. 4.05% Tokyu 
Corporation 
3.53% Eitaro Itoyama 
3.37% Japan 
Master Trust 
Bank 
2.76% Japan Trustee 
Service Bank 
2.72% Tokyo Marine & Fire 
Insurance Co. 
2.7% Mizhou Corporate 
Bank 
2.27% Nissay Dowa General 
Insurance Co. 
2.09% Nippon Life Insurance 
2% Fukuoka 
Mutual Life Insurance 
1.81% JAL 
Group employees 100% Japan 
Airlines 
Corporation Unchanged 
JAPAN AIRLINES 
DOMESTIC Unreported Unreported 100% Japan 
Airlines Corp.  Unreported Unreported 
Jordan  
ROYAL 
JORDANIAN 
AIRLINES 100% Gvt. 
Owned Unchanged Unchanged Unchanged Unchanged 
Kazakhstan  
AIR 
KAZAKHSTAN 50% Gvt. Owned 
50% KazKommerz 
Bank 100% Gvt. 
Owned Unreported Unreported Unreported 
Kenya  
KENYA 
AIRWAYS 22% Gvt. Owned 
16.22% Kenyan Institutions 
31.23% Kenyan 
Individuals 26% KLM 37.7% Kenyan 
Institutions 32.5% Kenyan 
individuals 
30.35% Foreign 
Institutional 
Investors 22% Gvt. 
Owned 15.7% Kenyan 
Institutions 
32.5% Kenyan Individuals 
26% KLM 
4.36% Foreign 
Institutional 
Investors 0.07% Foreign 
Individual 
Investors Unchanged Unchanged 
Kuwait  
KUWAIT 
AIRWAYS 100% Gvt. 
Owned Unchanged Unchanged Unchanged Unchanged 
Latvia  
AIR BALTIC 47.2% SAS 
0.2% Transaero 
52.6% Others Unreported Unreported Unreported Unreported  S/C/W/270/Add.2 
 Page 433 
 
 
  Airline 2002 2003 2004 2005 2006 
Lebanon  
MIDDLE EAST 
AIRLINES 99.37% Banque 
Central Unchanged Unchanged Unchanged Unchanged 
Lithuania  
LITHUANIAN 
AIRLINES 100% Gvt. 
Owned Unchanged Unchanged Unreported Unreported 
Luxembourg  
LUXAIR 23.1% Gvt. 
Owned 
13.4% Banque et Caisse d’Épargne 
de l’État 
13.2% Luxair Group 
13.1% Dexia/BIL 
13% Lufthansa 12.1% Banque 
Générale de 
Luxembourg 12.1% CLT/UFA 
SA 
 23.1% Gvt. 
Owned 
13.4% Banque et Caisse 
d’Épargne de 
l’État 13.2% Luxair 
Group 
13.1% Dexia/BIL 
13% Lufthansa 
12.1% Banque Générale de 
Luxembourg 
12.1% Panalpina 
World Transp. Unchanged Unreported Unreported 
Macao, China  
AIR MACAU Unreported Unreported 51% CNAC 
5% EVA Air 
5% Gvt. of 
Macao 5% Macao 
Investors 
15% TAP 14% STDM Unchanged 20% TAP 
14% STDM 
5% EVA air 
5% Macau investors 
5% Gvt. of 
Macao 
Madagascar  
AIR 
MADAGASCAR 89.58% Gvt. 
Owned 
6.91% Private interests 
3.48% Air France Unreported Unreported Unreported Unreported 
Malawi  
AIR MALAWI 100% Gvt. 
Owned Unchanged Unreported Unreported Unreported 
Malaysia  
MALAYSIA 
AIRLINES 29.09% Gvt. 
Owned 
20.21% 
Kumpulan Wang 
Amanah Pencen 
13.7% Employees Unchanged 69.34% 
Penerbangan 
Malaysia 
Berhad 
8.19% 
Employees 5.45% 
Amanah Raya 
Nominees 2.71% State 
Financial 
secretary 2.4% Warisan 
Harta Saba 
Sdn Bhd Unchanged 69.34% 
Penerbangan 
Malaysia 
Berhad 
10.72% 
Employees 5.69% 
Amanah Raya 
Nominees 2.71% State 
Financial 
secretary 2.4% Warisan 
Harta Saba 
Sdn Bhd S/C/W/270/Add.2 
Page 434  
 
  Airline 2002 2003 2004 2005 2006 
Malta  
AIR MALTA 96.4% Gvt. 
Owned 
2% Middle Sea Insurance 96.4% Gvt. 
Owned 
2% Middle Sea Insurance 
0.8% Middle 
Sea Valletta 
Life 98% Gvt. 
Owned 
2% Private companies Unchanged Unchanged 
Mauritius  
AIR MAURITIUS 51% Air 
Mauritius Holding 
4.72% State 
Investment Corporation 
4.53% Gvt. 
Owned 4.28% Rogers & 
Co. 
3.84% British Airways 
2.78% Air France 
2.56% Air India 6.32% Port Louis 
Fund 
19.72% Public investors Unchanged 51% Air 
Mauritius Holding 
4.72% State 
Investment Corporation 
4.53% Gvt. 
Owned 4.28% Rogers 
& Co. 
3.84% British Airways 
2.78% Air 
France 2.56% Air 
India 
5.75% Port Louis Fund 
20.54% Public 
investors 51% Air 
Mauritius Holding 
4.72% State 
Investment Corporation 
4.53% Gvt. 
Owned 4.28% Rogers & 
Co. 
3.84% British Airways 
2.78% Air 
France 2.56% Air India 
6.32% Port 
Louis Fund 19.97% Public 
investors Unchanged 
Mexico  
AEROMEXICO Unchanged Unchanged Unchanged Unchanged Unchanged 
MEXICANA 99.95% Cintra Unchanged Unchanged Unchanged 100% Grupo 
Posada 
Mongolia  
MIAT 
MONGOLIAN AIRLINES 100% Gvt. 
Owned Unreported Unreported Unreported Unreported 
Morocco  
ROYAL AIR 
MAROC 92.7% Gvt. 
Owned 
3.97% Air France 1.3% Iberia 92.7% Gvt. 
Owned 
2.87% Air France 
1.3% Iberia 95.95% Gvt. 
Owned 
2.86% Air France 
 95.39% Gvt. 
Owned 
2.86% Air France 
2.86% Iberia 
0.21% Others 95.39% Gvt. 
Owned 
2.86% Air France 
0.95% Iberia 
0.21% others 
Mozambique  
LAM 80% Gvt. Owned 
20% Employees Unchanged Unreported Unreported Unreported 
Namibia  
AIR NAMIBIA 100% Gvt. 
owned Unchanged Unreported Unreported Unreported 
Netherlands  
KLM ROYAL 
DUTCH 
AIRLINES Unreported Unreported 100% Air 
France-KM 
Group Unchanged Unchanged 
TRANSAVIA 80% KLM 
20% Nationale Investeringbank 100% KLM Unchanged Unreported Unreported  S/C/W/270/Add.2 
 Page 435 
 
 
  Airline 2002 2003 2004 2005 2006 
New Zealand  
AIR NEW 
ZEALAND 82% Gvt. Owned 
5.5% Brierley 
Investments 4.5% Singapore 
Airlines 77.9% Gvt. 
Owned 
5.2% Brierley Investments 
5% Qantas 
4.5% 
Singapore 
Airlines 80.5% Gvt. 
Owned 
4.5% Singapore 
Airlines 
5.1% Others  80.4% Gvt. 
Owned 
19.6% Publicly held 80.1% Gvt. 
Owned 
19.9% Publicly held 
Nigeria  
Nigeria Airways 100% Gvt. 
Owned Unchanged Unreported Unreported Unreported 
Norway  
NORWEGIAN Unreported Unreported Unreported Unreported 16.09% HBK 
Holding 
15.43% Lufttransport 
Holding 
4.63% JP Morgan 
Chase Bank 
4.58% Ojada 3.58% 
Goldman 
Sachs Intern Equity 
3.5% Bank of 
New York 
3.34% Vital 
Forsikring 2.64% 
Ankerlokken 
Holding 2.6% Credit 
Suisse 
2.57% JP Morgan 
Chase Bank 
Omnibus Lending 
2.15% 
Fidelity Funds 
2.03% 
Holdberg Norden 
Verdipapirfon
det 
1.99% NB 
NOR Norge 1.8% Ferd AS 
Invest 
1.53% Holdberg 
Norge 
Verdipapirfondet 
1.49% 
Fondsvasne  S/C/W/270/Add.2 
Page 436  
 
  Airline 2002 2003 2004 2005 2006 
1.37% 
Rasmussengr
uppen 1.3% Brown 
brothers Harri 
1.11% 
Jakobsen & 
Sonner 0.96% Aweco 
Inverst 
SAS BRAATHENS Unreported Unreported Unreported Unreported 100% SAS 
Group 
Oman (see also Gulf States)  
OMAN AIR 33.844% Gvt. 
Owned 
42.699% 
Individuals 23.457% Private 
Omani 
Companies 33.8% Gvt. 
Owned 
41.7%% 
Individuals 24.5% Private 
Omani 
Companies Unchanged Unreported 33.8% Gvt. 
Owned 
43.3%% 
Individuals 22.99% 
Private 
Omani Companies 
Pakistan  
PAKISTAN 
INTERNATIONAL 
AIRWAYS 57.66% Gvt. 
Owned 
27.37% Financial Institutions 
2.83% 
Investment 
Companies 
9.04% Individuals Unchanged 87% Gvt. 
Owned 
13% Others Unchanged Unchanged 
Panama  
COPA AIRLINES 51% Mota family 
49% Continental 
Airlines Unchanged 51% 
Panamanian 
private investors 
49% 
Continental Airlines Unchanged 51% 
Panamanian 
private investors 
10% 
Continental Airlines 
Papua New Guinea  
AIR NIUGINI 10% Gvt. Owned Unchanged Unreported Unreported Unreported 
Philippines  
PHILIPPINE 
AIRLINES 53.79% Lucio 
Tan 
35.15% Top Wealth 
Enterprises/Max
well 
Holdings/Richma
rk Holdings 4.26% Gvt. 
Owned 
2.61% Employees 
4.19% Others Unchanged 53.72% Lucio 
Tan 
35.15% Top Wealth 
Enterprises/Ma
xwell 
Holdings/Rich
mark Holdings 4.26% Gvt. 
Owned 
2.75% Employees 
4.14% Others Unchanged Unchanged 
Poland  
LOT POLISH 
AIRLINES 67.96% Gvt. 
Owned Unchanged Unchanged Unchanged Unchanged  S/C/W/270/Add.2 
 Page 437 
 
 
  Airline 2002 2003 2004 2005 2006 
25.1% SAirLines 
Europe 
9.94% Employees 
Portugal  
TAP 100% Gvt. 
Owned Unchanged Unchanged Unchanged Unchanged 
Qatar  
QATAR 
AIRWAYS 50% Gvt. Owned 
50% Private 
Investors Unchanged Unchanged Unchanged Unchanged 
Romania  
TAROM 97.87% Gvt. 
Owned 2.13% Private 
property 99.72% Gvt. 
Owned 0.28% Private 
property 90.59% Gvt. 
Owned 4.85% 
Bucharest 
airport 4.11% 
Romanian Air 
Traffic Control 0.28% 
Mutenia 
Private Investment 
Fund 
0.17% Romanian 
CAA Unreported Unreported 
Russia  
AEROFLOT 51% Gvt. Owned 
26% Carrroll 
Trading/Nimegen 
Trading 23% Unknown 
Investors 51% Gvt. 
Owned 
26% Carrroll 
Trading/Nimegen Trading 
23% Offshore 
trading companies 51.2 Gvt. 
Owned 
27% National 
Reserve Corporation 
19% 
Employees & others Unchanged Unchanged 
KRASAIR Unreported Unreported Unreported 51% City Gvt. of 
Krasnoyarsk 
49% Air Bridge Management 
Company Unchanged 
PULKOVO 
AIRLINES 100% Gvt. 
Owned Unchanged Unchanged Unchanged Unchanged 
TRANSAEREO 95% Private 
Holdings 
5% Aeroflot Unreported Unreported Unreported Aerotrans 
Joint Stock 
Company, 
Ikar, 
Ilyushin 
Design Bureau, 
Laves 
Saudi Arabia  
SAUDI ARABIAN 
AIRLINES 100% Gvt. 
Owned Unchanged Unchanged Unchanged Unchanged 
Scandinavia  
SAS 50% Publicly 
held 100% SAS 
Group 50% Publicly 
held 100% SAS 
Group Unchanged S/C/W/270/Add.2 
Page 438  
 
  Airline 2002 2003 2004 2005 2006 
21.4% Gvt. Of 
Sweden 
14.3% Gvt. Of Denmark 
14.3% Gvt. Of 
Norway 21.4% Gvt. Of 
Sweden 
14.3% Gvt. Of Denmark 
14.3% Gvt. Of 
Norway 
Serbia  
JAT AIRWAYS Unreported Unreported 100% Gvt. 
Owned Unreported Unreported 
Seychelles  
AIR 
SEYCHELLES 100% Gvt. 
Owned Unchanged Unchanged Unreported Unreported 
Singapore  
SILK AIR 100% Singapore 
Airlines Unchanged Unchanged Unchanged Unreported 
SINGAPORE 
AIRLINES 56.7% Temasek 
Holdings 
11.45% Raffles Nominees 
8.45% DBS 
Nominees 4.1% HSBC 
Singapore 
Nominees 3.59% Citibank 
Nominees 
9.96% Other 
investors 
 57% Temasek 
Holdings 
12% Raffles Nominees 
8% DBS 
Nominees 2% DB 
Nominees 
(Singapore) 4% HSBC 
Singapore 
Nominees 
3% Citibank 
Nominees 1.65% United 
Overseas Bank 
Nominees 3% Other 
investors 
 100% 
Singapore 
Airlines Group Unchanged Unchanged 
Slovakia  
SKYEUROPE 
AIRLINES Unreported Unreported Unreported Unreported 57.3% Free 
float 
13.3% 
Endavor Holdings 
9.9% Loryma 
Investments 8.4% East 
Capital 
6.5% Merrill Lynch 
5.7% Griffin 
Capital 
Management 
Slovenia  
ADRIA AIRWAYS 75% Gvt. Owned 
16% Slovenian investment funds Unchanged Unreported Unreported Unreported 
Solomon Islands  
SOLOMON 
AIRLINES 100% Gvt. 
Owned Unchanged Unreported Unreported Unreported  S/C/W/270/Add.2 
 Page 439 
 
 
  Airline 2002 2003 2004 2005 2006 
South Africa  
COMAIR 40% Institutions 
& public 
37% Management 
18% British 
Airways 
5% Employees Unchanged Unchanged 39% 
Management 
38% Institutions & Public 
18% British 
Airways 
5% Employees Unreported 
SOUTH AFRICAN 
AIRWAYS 100% Gvt. 
Owned (via Transnet) Unchanged Unchanged Unchanged 98.2% Gvt. 
Owned (via Transnet) 
1.8% SAA 
Share Incentive 
Trust 
South Korea  
ASIANA 
AIRLINES 15.1% Korea 
Kumho Petrochemical 
Co. 
9% Kumho Development Co. 
29.8% Kumho 
Industrial 2.9% Treasury 
stock 
41.1% Other 
Private investors 29% Kumho 
Industrial 15% Kumho 
Petrochemical 
7% Korea Development 
Bank 
2.9% Treasury stock 
2% Kumho 
Development 
1% Korean 
Foreign Exchange Bank 
41% Other 
shareholders 29.8% Kumho 
Industrial 15.1% Kumho 
Petrochemical 
7.2% Korean Development 
Bank 
2.9% Treasury stock 
1.8% Kumho 
Development 
1.2% Korea 
Foreign Exchange 
Bank 
0.6% Cho-Heung Bank 
41.4% Other 
private investors  29.51% Kumho 
Industrial 15.05% Kumho 
Petrochemical 
7.18% Korea Development 
Bank 
2.89% Treasury stock 
1.76% Kumho 
Development 
1.18% Korea 
Foreign Exchange Bank 
11.9% Foreign 
investors 30.53% Private 
investors Unchanged 
KOREAN AIR 18.56% Mr. 
Choong-Hoon & 
family 16.16% Foreign 
ownership 
13.66% Other institutions 
3.66% Bank of 
Seoul 3.19% Kokusai 
Kogyo & Co. 
2.89% Employee 
stock 
40.59% Others  30.82 Mr. 
Yang Ho Cho 
& family 15.98% 
Foreign 
ownership 39.1% Other 
institutions 
3.66% Bank of Seoul 
3.27% Franklin 
Templeton 
Investment 
Trust Management 
3.18 National 
Pension Corporation 
3.14% Kokusai 
Kogyo & Co. 0.23% 
Employee 
stock 12.13% Yang 
Ho Choi & 
Family 7.82% Hanjin 
8.22% 
Employees 3.44% 
National 
Pension Corporation 
3.21% Kojusai 
Kogyo Corp. 
2.71% Inha 
University Foundation 
1.96% 
Jungseok foundation 
1.15% Hana 
Bank 0.87% Oriental 
Fire & Marine 
Insurance Co. Unchanged 12.13% Yang 
Ho Choi & 
Family 7.82% Hanjin 
8.22% 
Employees 3.44% 
National 
Pension Corporation 
3.21% 
Kojusai 
Kogyo Corp. 
2.71% Inha University 
Foundation 
1.96% Jungseok 
foundation 
1.15% Hana Bank 
0.87% 
Oriental Fire S/C/W/270/Add.2 
Page 440  
 
  Airline 2002 2003 2004 2005 2006 
40.59% Others 
 0.33% Korea 
Research 
Foundation for 21C 
61.14% Others& Marine 
Insurance Co. 
61.14% Others 
Spain  
AIR EUROPA Unreported Unreported Unreported 100% Globalia 
Corp. Unreported 
IBERIA 60% Stock 
exchange 
10% Caja Madrid 9% British 
Airways 
7.3% BBVA 1% American 
Airlines 60% Stock 
exchange 
10% Caja Madrid 
9% British 
Airways 7.3% BBVA 
6.7% Logistica 
3% El Corte Ingles 
3% Ahorro 
Corporacion 1% American 
Airlines Unchanged Unchanged Unchanged 
SPANAIR 51% Marsans 
Group 49% SAS 51% Teinver 
SA 49% SAS 94.9% SAS 
5.1% Grupo Marsens 
 Unchanged Unchanged 
Sri Lanka  
SRILANKAN 
AIRLINES 51% Gvt. Owned 
43% Emirates 
5.37% 
Employees 51% Gvt. 
Owned 
40% Emirates 
5.37% Employees 51.05% Gvt. 
Owned 
43.63% 
Emirates 5.32% 
Employees Unchanged Unchanged 
Switzerland  
SWISS (Swiss 
International from 2002) 20.5% Gvt. 
Owned 10.5% UBS 
6.8% AMAG 
10% Crédit Suisse 
10.2% Canton of 
Zurich 52% Others  20.5% Gvt. 
Owned 64.7% 
Institutional 
investors 2.7% Privately 
held 
12.1% Cantons & communities 20.3% Gvt. 
Owned 61.3% 
Institutional 
investors 4.1% Privately 
held 
12.2% Cantons & 
Communities 
2.1% Non-registered 
shares 98.7% Air Trust 99% Air 
Trust 
Syria  
SYRIANAIR 100% Gvt. 
Owned Unchanged Unchanged Unchanged Unreported 
Tanzania  
AIR TANZANIA 100% Gvt. 
Owned 51% Gvt. 
Owned 
49% South African 
Airways Unreported Unreported Unreported  S/C/W/270/Add.2 
 Page 441 
 
 
  Airline 2002 2003 2004 2005 2006 
Thailand  
THAI AIRWAYS 
INTERNATIONAL 93% Gvt. Owned Unchanged 79.5% Gvt. 
Owned 
(Ministry of Finance) 
7.1% 
Institutional & 
private 
investors Gvt. Savings 
Bank 13.4% 53.98% Gvt. 
Owned (Ministry 
of Finance) 9.15% Vayupak 
Fund by Krung 
Thai 
Asset 
Management 9.15% Vayupak 
Fund by MFC 
Asset Management 
2.64% Morgan 
& Stanley 1.98% State St. 
Bank London 
1.22% Goldman Sachs 
1.13% HSBC 
Singapore 1.13% State St. 
Bank 
0.98% NVDR Co.  
 53.98% Gvt. 
Owned 
(Ministry of Finance) 
9.15% 
Vayupak 
Fund by 
Krung Thai Asset 
Management 
9.15% Vayupak 
Fund by MFC 
Asset Management 
2.64% 
Morgan & Stanley 
1.98% State 
St. Bank London 
1.22% 
Goldman Sachs 
1.13% HSBC 
Singapore 
1.13% State 
St. Bank 0.98% NVDR 
0.8% 
Citibank 
Tonga  
ROYAL TONGAN 
AIRLINES 100% Gvt. 
owned Unchanged Unreported Unreported Unreported 
Trinidad & Tobago  
BWIA 49.26% Gvt. 
Owned 
29.52% Foreign shareholders 
21.22% Regional 
shareholders Unchanged Unreported 75% Gvt. 
Owned 
25% Private investors Unchanged 
Tunisia  
TUNISAIR 74.42% Gvt. 
Owned 
5.58% Air France 
20% Private 
sector Unchanged Unchanged Unchanged Unchanged 
Turkey  
SUNEXPRESS  Unreported Unreported Unreported 50% Thomas 
Cook 50% THY 
Turkish Airlines Unchanged 
THY TURKISH 
AIRLINES 98.2% TC 
Privatization Administration 
1.8% Public 
shareholders Unchanged Unchanged 75.2% TC 
Privatization Administration 
24.8% Private 
shareholders 53.57% 
Private shareholders 
46.43% TC 
Privatization Administrat. S/C/W/270/Add.2 
Page 442  
 
  Airline 2002 2003 2004 2005 2006 
Ukraine  
AEROSVIT Unreported 40% Ukraine 
Agency for Air 
Communication and Tourism 
38% Gilward 
Investments 
22% State 
Property Fund Ukraine Unreported Unchanged Unchanged 
AIR UKRAINE 100% Gvt. 
Owned Unreported Unreported Unreported Unreported 
UKRAINE 
INTERNATIONAL AIRLINES 61.6% Gvt. 
Owned 6% Debis 
22.5% 
Austrian/Swiss Airlines 
9.9% EBRD 
 Unchanged Unreported Unreported Unreported 
United Arab Emirates  
EMIRATES 100% Gvt. of 
Dubai Unchanged Unchanged Unchanged Unchanged 
United Kingdom  
BRITISH 
AIRWAYS 100% publicly 
traded Unchanged Unchanged Unchanged Unchanged 
BRITISH 
MEDITERRANEAN Unreported Unreported 100% 
Privately 
owned Unreported Unreported 
BRITISH 
MIDLAND (BMI) 60% Private 
investors -(BMI Partnership) 
20% Lufthansa 
20% SAS 50% Private 
investors -(BMI 
Partnership) 
30% Lufthansa 20% SAS Unchanged Unchanged 50%+1 vote 
Private investor - (Sir 
Michael 
Bishop) 30% 
Lufthansa 
20% SAS 
FLY BE Unreported Unreported  Unreported 100% Privately 
owned Unreported 
GB AIRWAYS 100% Bland 
Group Unchanged Unchanged Unchanged Unchanged 
VIRGIN 
ATLANTIC 51% Virgin 
Group 49% Singapore 
Airlines Unchanged Unchanged Unchanged Unchanged 
United States  
ALASKA 
AIRLINES Unreported Public Public 100% Alaska 
Air Group Unchanged 
ALOHA AIRLINES 100% Aloha Air 
Group Unchanged Unchanged Unchanged Unchanged 
AMERICA WEST 51% Texas 
Pacific Group 49% publicly 
listed Unchanged 100% America 
West Holding Unchanged 100% US 
Airways Group 
AMERICAN AIRLINES 100% publicly 
traded Unchanged Unchanged Unchanged Unchanged 
ATA AIRLINES Unreported Unreported Unreported 100% ATA 
Holdings Unreported  S/C/W/270/Add.2 
 Page 443 
 
 
  Airline 2002 2003 2004 2005 2006 
CONTINENTAL 
AIRLINES 100% publicly 
traded Unchanged Unchanged Unchanged Unchanged 
CONTINENTAL 
MICRONESIA 100% 
Continental Airlines Unreported Unreported Unreported Unreported 
DELTA  89% publicly 
traded 
11% employees Unchanged Unchanged 89.3% publicly 
traded 
9.8% employees 
0.8% other Unchanged 
FRONTIER JET 
EXPRESS Unreported 100% Mesa Air 
Group Unreported Unreported Unreported 
HAWAIIAN 
AIRLINES 100% Publicly 
traded 100% 
Hawaiian 
Holdings Inc. Don Carty 
Hawaiian 
Holdings 100% Hawaiian 
Holdings Inc. Unchanged 
NORTHWEST 27% Employees 
11% Alfred Checci 
11% Gary 
Wilson 11% Richard C 
Blum Unchanged Unchanged 100% publicly 
traded Unchanged 
SOUTHWEST 
AIRLINES Unreported Unreported Unreported 100% Publicly 
held Unreported 
UNITED 100% publicly 
held (majority 
through 
employees) Unchanged Unchanged Unchanged Unchanged 
US AIRWAYS 100% publicly 
traded 36.6% 
Retirement 
Systems Alabama 
19.3% ALPA 
members 7.8% 
Management 
5% General Electric 
10.08% Other 
employees 10.5% 
Unsecured 
creditors 10% Air 
Transportation 
Stabilization Board 
 Unchanged Unchanged 100% US 
Airways 
Group 
Uzbekistan  
UZBEKISTAN 
AIRWAYS 100% Gvt. 
Owned Unchanged Unreported Unreported Unchanged 
Western Samoa  
POLYNESIAN 
AIRLINES 100% Gvt. 
Owned Unchanged Unreported Unreported Unreported 
Vanuatu  
AIR VANUATU 100% Gvt. 
Owned Unchanged Unreported Unreported Unreported S/C/W/270/Add.2 
Page 444  
 
  Airline 2002 2003 2004 2005 2006 
Venezuela (Bolivarian Republic of)  
AEROPOSTAL-
ALAS DE 
VENEZUELA 100% Haydhelen 
Velasquez & 
Ramiz Unchanged  Unreported Unreported Unreported 
SERVIVENSA 100% Avensa Unreported Unreported Unreported Unreported 
Vietnam  
VIETNAM 
AIRLINES 100% Gvt. 
Owned Unchanged Unchanged Unchanged Unchanged 
Zimbabwe  
AIR ZIMBABWE 100% Gvt. 
Owned Unchanged Unreported Unreported Unreported 
 
Source :  Airline Business September 2001-2006, compiled and supplemented by the WTO Secretariat. 
711. The Secretariat is planning, if Members so agree,  to analyse these data in more detail, i.e. by 
region, level of developmen ts and type of shareholde rs (public vs. private, na tional vs. foreign, central 
government vs. regional government, airlines vs. financial investors, etc). so as to provide a "reality 
check" for the information contained in QUASAR and in its future versions.   
(b) Trans-national ownership developments 
(i) Introduction 
712. Because of the regulatory constraints proper to the sector, and in particular because of the 
pervasiveness of the SOEC criteria both in bilatera l ASAs and in national investment regimes, trans-
national ownership remains a marginal phe nomenon in the air transport sector.   
713. In a recent discussion paper, the UK Civil Aviation Authority390 notes that ownership is less 
internationalized in the air transport sector than that in sectors traditiona lly insulated from foreign 
direct investment flows, such as defence and utilities.   
714. Majority foreign ownership remains an extremel y rare feature, except in countries that have 
adopted principal place of business criteria both in  their investment and designation/withholding 
regime.  When it was still UK-owned, Virgin Blue, the Australian-based subsidiary of the UK Virgin 
Group, was a case in point,391 even it was essentially operating on th e internal Australian market, as it 
risked facing a withholding veto on the part of Au stralia's bilateral partners applying the SOEC 
criterion.   
715. Majority-ownership may also o ccur in the case of airlines' privatisation.  Examples include 
the 51 per cent of Cameroon's carrier Camair owned by a Belgium consortium led by SN Brussels, or 
the 51 per cent of Air Senegal owned by Royal Air Maroc.   
716. Minority share-holdings are more frequent and can be classified in two types: 
• Symbolic and often reciprocal participations, main ly motivated by the desire to materialize an 
alliance e.g. the 2 per cent share of Alitalia owned by Air France or the recent US$12 million 
reciprocal exchange between Japanese carrier AN A (equivalent to 0.16 per cent of the shares) 
and Korean carriers ASIANA (0.76 per cent of the shares). 
                                                      
390  Available at:  http://www.caa.co.uk/docs/33/CAP769.pdf  
391 Virgin Blue was taken over by an Australian investor, Toll Holdings, but for pure commercial 
reasons.  S/C/W/270/Add.2 
 Page 445 
 
 
  • Substantial holdings, ranging from 25 to 49 per cen t of the equity, sometimes coupled with a 
management contract where the investing airline plays the role of a strategic partner, e.g. 
Emirates and Sri Lankan Airlines, Virgin and Nigeria Airlines.  
717. Table 57 presents international cross-airline inv estments and disinvestments, at the beginning 
and at the end of the period under review.   
Members may wish to correct, update or complement  the information contained in Table 57. 
Table 57 
International cross-airline investment s and disinvestments, 2001 and 2006 
 
Holding airline Held airline 2001 
holding 2006 
holding Change 
2001-2006 
Aer Lingus (IRL) Futura International Airways (ESP) 85% 20% -65 % 
Air China (CHN) Cathay Pacific (HGK) 0% 10.2% +10.2% 
Air France (FRA) Air Afrique (Multinational) (defunct)  12.2% 0% -12.2% 
Air France (FRA) Air Gabon (GAB) 20% 0% -20% 
Air France (FRA) Air Madagascar (MDG) 3.5% 3.2% -0.3% 
Air France (FRA) Air Mauritius (MUS) 2.8% 2.8% Unchanged 
Air France (FRA) Air Tunis (TUN) 5.6% 5.5% -0.1% 
Air France (FRA) Alitalia (ITA) 0% 2% +2% 
Air France (FRA) Austrian Airways (AUT) 1.5% 1.5% Unchanged 
Air France (FRA) Cameroon Airways (CAM) 3.6% 3.6% Unchanged 
Air France (FRA) Royal Air Maroc (MAR) 4.0% 2.9% -1.1% 
Air Malta (MAL) Azzur’Air (ITA) (defunct) 49% 0% -49% 
Air New Zealand (NZL) Air Paci fic (FJI) 2.0% 3.6% +1.6% 
Air India (IND) Air Mauritius (MUS) 2.6% 2.6% Unchanged 
American Airlines (USA) Iberia (ESP) 1% 1% Unchanged 
Austrian Airlines (AUT) Slovak Airlines (SVK) 0% 62% +62% 
Austrian Airlines (AUT) Ukraine International Airways (UKR) 19.7% 22.5% +2.8% 
British Airways (GBR) Air Mauritius (MUS) 3.8% 3.8% Unchanged 
British Airways (GBR) Com Air (RSA) 18.3% 18% -0.3% 
British Airways (GBR) Iberia (ESP) 9% 9% Unchanged 
British Airways (GBR) Qantas (AUS) 25% 0% -25% 
Cathay Pacific (HGK) Air China (CHN) 0% 20% +20% 
Continental (USA) Copa (PAN) 49% 10% -39% 
Delta (USA) Proteus  (FRA) (defunct) 34% 0%  -34% 
Emirates (UAE) Srilankan Airl ines (LKA) 26% 43.6% +17.6% 
EVA (TWN) Shanghai Airlines Cargo (CHN) 0% 25% +25% 
EVA  (TWN) Air Macau (MAC) 5% 5% Unchanged 
Iberia (ESP) Royal Air Maroc (MAR) 1.3% 1% -0.3% 
Kenya Airways (KEN) Precision  Air (TAN) 0% 49% +49% 
KLM (NED) Braathens (NOR) 30% 0% -30% 
KLM (NED) Kenya Airways (KEN) 26% 26% Unchanged 
Kuwait Airways (KUW) Shorouk Air (EGY) (defunct) 49% 0%  -49% 
LAN (CHL) ABSA (BRA) 0% 73.3% +73.3% 
LAN (CHL) Florida West International Air (USA) 0% 25% +25% 
LAN (CHL) LAN Argentina (ARG) 0% 100% +100% 
LAN (CHL) LAN Dominicana (DMA) 0% 49% +49% 
LAN (CHL) LAN Ecuador (ECU) 0% 45% +45% 
LAN (CHL) LAN Peru (PER) 49% 49% Unchanged 
LAN (CHL) MAS (MEX) 0% 39.5% +39.% 
Lufthansa (DEU) Air Dolomiti (ITA) 26% 100% +74% 
Lufthansa (DEU) BMI & BMI Regional (GBR) 20% 30% +10% 
Lufthansa (DEU) Lauda Air (AUT) 20% 0% -20% 
Lufthansa (DEU) Luxair (LUX) 13% 13% Unchanged 
Maersk Air (DNK) (defunct) Est onian Air (EST) 49% 0% -49% S/C/W/270/Add.2 
Page 446  
 
  Holding airline Held airline 2001 
holding 2006 
holding Change 
2001-2006 
Qantas (AUS) Air Pacifi c (FJI) 46% 46.3% +0.3% 
Qantas (AUS) Jetstar Asia (SGP) 0% 49% +49% 
Qantas (AUS) Thai Air Cargo (THA) 0% 49% +49% 
Royal Air  Maroc (MAR) Air Gabon (GAB) 0% 51% +51% 
Royal Air Maroc (MAR) Air Senegal (SEN) 0% 51% +51% 
SAS Air Baltic 34.2% 47.2% +13% 
SAS BMI 20% 20% Unchanged 
SAS Spanair 49% 94.9% +45.9% 
Singapore Airlines (SGP) Air Ne w Zealand (NZL) 49% 0% -49% 
Singapore Airlines (SGP) Virgin Atlantic (GBR) 49% 49% Unchanged 
Swissair (CHE) (defunct) Air Euro pe (GBR) (defunct) 49% 0% -49% 
Swissair (CHE) (defunct) Air Litto ral (FRA) (defunct) 49% 0% -49% 
Swissair (CHE) (defunct) AOM French Airlines (FRA) (defunct) 49% 0% -49% 
Swissair (CHE) (defunct) Austrian  Airlines (AUT) 10% 0% -10% 
Swissair (CHE) (defunct) Delta (USA) 4.6% 0% -4.6% 
Swissair (CHE) (defunct) LOT (POL) 37.6% 0% -37.6% 
Swissair (CHE) (defunct) LTU (DEU) 49.9% 0% -49.9% 
Swissair (CHE) (defunct) Portugalia (POR) 42% 0% -42% 
Swissair (CHE) (defunct) SAA (RSA) 20% 0% -20% 
Swissair (CHE) (defunct) Sabena  (BEL) (defunct) 49% 0% -49% 
Swissair (CHE) (defunct) TAP (POR)  34% 0% -34% 
Swissair (CHE) (defunct) Ukraine International Airlines (UKR) 5.6% 0% -5.6% 
Swissair (CHE) (defunct) Volare (ITA) 34% 0% -34% 
TACA (SLV) Aviateca (C OL) 30% 30% Unchanged 
TACA (SLV) Islena (HND) 20% 20% Unchanged 
TACA (SLV) LACSA (CRI) 10% 10% Unchanged 
TACA (SLV) NICA (NIC) ** 49% 0% -49% 
TAP (POR) Air Sao Tome e Principe (STP) 40% 40% Unchanged 
TAP (POR) Air Macau (MAC) 25% 20% -5% 
Transaereo (RUS) Baltic Airlines (LAT) 0.2% 0.2% Unchanged 
Transaereo (RUS) Riga Airlines  (LAT) (defunct) 30% 0% -30% 
Varig (BRA) PLUNA (URY) 49% 49% Unchanged 
VASP (BRA) (defunct) Ecuatorian a (defunct) 50.1% 0% -50.1% 
VASP (BRA) (defunct) LAB (BOL) 49% 0% -49% 
Virgin  Atlantic (GBE) Virgin Ni gerian Airways (NGR) 0% 49% +49% 
Virgin Blue (AUS) Pacific Blue (NZL) 0% 100% +100% 
Virgin Blue (AUS) Polynesian Blue (WSM) 0% 49% +49% 
 
Source : Airline Business, September 2001-2006, as compiled by the WTO Secretariat.  
(ii) Regional analysis 
(a) Intra-Europe 
718. In 2000, cross-ownership between European air lines accounted for 42 per cent of all instances 
of cross-airline ownership.  By 2006, this share had decreased 20.3 per cent.  This apparent regression 
is, however, misleading, for two main reasons:  
• First, the need to create compan y structures which permit the retention of international traffic 
rights under bilateral ASAs explains why the major consolidations of Air France-KLM and 
Lufthansa-Swiss International Air Lines do not  appear as foreign investments, despite 
constituting important consolidations of the market. 
• Second, following the 2002 ECJ "open skies" judgements, consolidation is widely expected 
and up to certain extent has already started with the takeover/merger of KLM by Air France  S/C/W/270/Add.2 
 Page 447 
 
 
  and of Swiss by Lufthansa.  The ongoing sale of  Alitalia and the various  offers formally or 
informally made for a possible takeover of Iber ia are other examples of this tendency.   
719. An interesting development in the case of Alitalia and Iberia is the key role played by various 
private equity funds (e.g. Apax, Texas Pacific Group) in the financing of the various bids.  
720. Another notable development is the appearance of  extra-EU actors:  Aeroflot was at one stage 
bidding for Alitalia392, and Aeroflot and Air India for the Serb ian carrier JAT, whose privatisation is 
still under way.  One of these extra EU bid was su ccessful, as the Russian consortium Airbridge, led 
by the Russian carrier Kras Air, took over the Hunga rian national carrier Malev in February 2007.  
(b) Europe-North America 
721. American Airline's 1 per cent interest in Iber ia is now the only remaining transatlantic cross-
ownership instance.  However, the newly negotiate d provisions on cross-ownership in the First Phase 
US-EU agreement393 may open up new possibilities in this regard.   
(c) Europe-Asia/Pacific 
722. The sale by British Airways of its interest in Qantas, which had already been reduced to 
18.25 per cent, signified the relinquishment of on e of the only two cases of cross-ownership between 
European and Asia-Pacific airlines.  The other case, TAP's equity share in Air Macao, has also been 
significantly reduced.   
723. The sole instance of investment in a European carrier by an Asian entity, i.e. the 49 per cent 
share of Virgin Atlantic owned by Singapore Airlines has remained stable. 
(d) Europe-Africa 
724. In spite of a slight reduction, there remains a significant number of investments in African 
airlines by European counterpar ts.  The majority of these are held by Air France and represent 
minority stakes with francophone African countries.  Significantly, Air France has withdrawn from its 
two largest investments, Air Gabon and Ai r Afrique which ceased operation in 2001.  
725. The remaining major investments are British Airway's continued equity interest in Comair of 
South Africa, another instance of historical ti es underpinning trans-national ownership, KLM's 
ongoing major investment in Kenya Airways, and the major new initiative of Virgin Atlantic taking a 
49 per cent share in a new Nigerian national airline,  Virgin Nigeria, after the folding of Nigeria 
Airways in 2004.  One may note also the recent sale of 51 per cent of the share of Cameroon's national carrier Camair to a consortium of Belgium investors led by SN Brussels.   
(e) Intra-Africa 
726. The period under review has seen the first exam ples of consolidation in Africa.  Two of 
Africa's most successful airlines, Royal Air Maroc and South African Airlines, have taken major 
equity interests in other African carriers:  Air Se negal, Air Gabon and, more recently, Air Mauritanie 
in the case of Royal Air Maroc, and Air Tanzan ia in the case of South African Airlines.  
(f) Intra-Asia/Pacific 
727. Qantas and Air New Zealand have both retained th eir interests in Fiji's Air Pacific. However, 
the two principal carriers from Oceania saw their plan s to merge into a single entity blocked by a New 
                                                     
 
392  At various stages of the pro cess, several Italian government offi cials had also expressed the hope 
that Alitalia end up being sold  to a large Asian carrier.   
393 For the integral text of these provisions, se e Box 1 in the profile of  the US-EU Agreement. S/C/W/270/Add.2 
Page 448  
 
  Zealand court, which found the move to be anti- competitive in 2004, and definitively ruled out on 
appeal in late 2006.  The Single Aviation Market (SAM) has nevertheless allowed Australia’s Virgin 
Blue to set up a fully owned subsidiary in New Zealand under the name Pacific Blue.  Samoa-based 
Polynesian Blue is also 49 per cent owned by Virgin  Blue.  Qantas has moved into the Asian market 
with important interests in Thai Air's cargo section and Jetstar Asia, a low-cost airline operating out of 
Singapore.   
728. Emirates has increased its equity interest in SriLankan Airlines and controls the airline under 
a management contract.  Cathay Pacific's stake in Air China increased to 20 per cent;  reciprocally, 
Air China now has a 10.2 per cent interest in Cathay .  EVA, the airline of Chinese Taipei, has also 
invested in a mainland cargo airline, Shanghai Airlines Cargo.  Korean Airlines is also reported to be 
attempting to penetrate the Chinese cargo market by setting up a strategic alliance with a Chinese 
software company to form an all cargo Chinese carrier.  
(g) Intra-Americas 
729. The only case of investment between North a nd Central America, Continental's 49 per cent 
stake in COPA, has remained constant.  However,  within South America, airlines have generally 
followed the example established by TACA which e xpanded in the 1990s from its Salvadorian base to 
Guatemala (Aviataca), Costa Rica (Lacsa), Nicaragua (Nica) and Honduras (Sahsa).
394   
730. LAN-Chile is probably the best-known example of that tendency.  During the period under 
review it established its presence in the passenger markets of Argentina, the Dominican Republic, 
Peru, Ecuador, as well as on the all-cargo markets of Mexico (MASair) and of the United States (Florida west International Airways).  
731. In March 2007, Gol the successful Brazilian low-cost carrier, was reported as pondering 
setting up domestic units in Argentina and Peru.  By finally taking over Varig after a protracted 
bankruptcy process, it also has prevented LAN-Chile from creating a Brazilian unit.   
732. Brazilian carrier Vasp sold its stake in Ecuato riana and Lloyd Aero Boliviano.  Similarly, 
Varig had once held a participation in the Uruguayan carrier Pluna, but finally sold it to Conviasa, the 
new state-owned Venezuelan carrier.  Another Br azilian carrier, Ocean Air, owned by the Sinergy 
Group, traditionally specialized in regional and freight traffic, has followed a path similar to that of 
LAN by taking control successively of the Colombia n carrier Avianca (75 per cent in 2004, 100 per 
cent in 2006) and of the Ecuadorian carrier Vipsa, and by launching with a local Peruvian partner 
Wayra-Peru.  Citizenship problems for the major ity ownership of Avianca were solved by the 
granting of the Colombian nationality to the Chairm an of the Sinergy group Mr. German Efremovich. 
733. During the period under review, Brazil's TAM tried a similar strategy by taking a 
management control share in the Paraguayan ca rrier Lapsa, that it renamed TAM-Mercosur.   
734. Peruvian carrier Aero Continente created a start- up in Chile and tried to buy Ecuatoriana.  It 
has now only one foreign subsidiary left, in the Dominican Republic.   
735. Aerolinas Argentinas also created a unit in Chile, Aerolíneas del Sur.  It had had the intention 
of creating "Aerolíneas del Peru" in January 2006 an d bid unsuccessfully for Uruguayan carrier Pluna.   
736. Finally, Venezuelan carrier Aero Postal took  a minority stake in Honduran local start-up 
airline Solair and in the Ecuadorian carrier Aeroga l, a stake in Aero Repúbl ica, the second largest 
airline of Colombia, and has a start-up project in Nicaragua, Alas de Centro América.  
                                                     
 
394 The projects announced during the period under review have been so numerous that it is difficult to 
know, even by following developments in th e specialised press, if all have succeeded.  S/C/W/270/Add.2 
 Page 449 
 
 
  737. This frantic trans-national activity in Latin Amer ica can be explained partially by a desire to 
achieve economies of scale.  Out of around 400 mi llion Latin-Americans, only about 3 per cent can 
afford to travel by air.  The small traffic volumes,  coupled with generally long distances, mean that 
the only way for carriers to reap economies of scal e is to go cross-boarder.  Significantly, the 
successful ventures are either located on a string of fi fth, sixth or seventh freedom destinations (e.g. 
subsidiaries of LAN-Chile located between Chile and the United States) or are using the hub and 
spoke system in a cross border fashion.   
738. National legislations, however, do not seem have been adapted to the changed environment, 
at least not at the same pace.  It would thus appear that a " lex mercatoria"  has developed in Latin 
America, and the region may constitute an example for the rest of the world in that respect.   
739. Tables 58 and 59 provide a synthetic snapshot of trans-national ownership in April 2004, by 
region and by level of development. 
Table 58 
Trans-national ownership, April 2004 
 
 Asia Africa Eastern 
Europe Western 
Europe Latin 
America Middle 
East North 
America Pacific Total 
Number of 
operating airlines 143 91 156 223 135 53 149 60 1010 
Number of airlines 
whose equity is held 
by foreign investors/ 
airlines 37 24 23 60 39 8 29 10 230 
Number of airlines 
owning stakes in 
foreign airlines 7 7 3 26 9 5 6 2 65 
Source :  Air Transport Bureau, ICAO. 
 
Table 59 
Foreign direct investments by and in airlines, by region, 2004 
 
Developing countries Developed countries 
Item Africa Asia Latin 
America Sub 
total Western 
Europe North 
America Other 
developed 
countries Sub 
total CIS Total 
Number of 
operating 
airlines 91 196 135 422 223 149 60 432 156 1010 
Number of 
airlines owned 
by foreign 
investors/ 
airlines 24 45 39 108 60 29 10 99 23 230 
Share owned 
by foreign 
investors/ 
airlines 26 41 29 26 27 19 17 23 15 23 
Number of 
airlines owning 
stakes in 
foreign airlines 7 12 9 28 26 6 2 34 3 65 
Share of 
airlines owning 
stakes in 
foreign airlines 8 14 7 7 12 4 3 8 2 6 
Note:   CIS = Commonwealth  of Independent States. 
Source :  Air Transport Bureau, ICAO. S/C/W/270/Add.2 
Page 450  
 
  (iii) Other significant trends 
740. It may be ambitious to talk about "trends" when examining the Brownian activity of trans-
national investments and disinvestments in airlines.  Nevertheless, some recurrent features can be noted.   
(a) Rationale 
741. Some of this trans-national activity obeys to purely commercial considerations, while other is 
clearly linked to the regulatory specificities of the sector.   
742. With regard to commercially-motivated ac tivity, there are several examples in which 
investors and journalists alike seem to forget that air transport is not a sect or like any other.  For 
instance, in June 2006, British Airways' shares ro se by 5.8 per cent in one day on rumours that the 
airline would be totally taken-over by Emirates.  Similarly, the Financial Times appeared to take 
seriously the rumour of a complete merger  between Singapore Airlines and Qantas.   
743. Besides these anecdotal cases, however, co mmercial motives behind investments and 
disinvestments in airlines may include:  
• A need to finance new projects, e.g. British Airw ays' sale of its 18.5 per cent stake in Qantas 
or the recent review by Singapore Airlines of its  49 per cent stake in Virgin Atlantic on the 
wake of several investment projects in China.   
• A satisfactory price being offered, e.g. the di sinvestment of the UK Virgin Group from Virgin 
Blue to the benefit of the Australian company Toll Holdings.   
• An interest in emerging markets, notably China and India, e.g. Singapore Airlines' desire to 
acquire a 25 per cent stake in China Eastern, or  the investment in Indian start up low-cost 
carrier Spice Jet on the part of European, North American and Middle Eastern financial groups (e.g. BNP Paribas, KBC,  Goldman Sachs, Ishtimar). 
• An interest in challenging but highly lucrative markets, e.g. the case of the 49 per cent stake 
of Virgin in Virgin Nigeria, or, symmetrically , an interest in more mature but less risky 
markets, e.g. Aeroflot's bid for Alitalia and JAT.  
744. Some trans-national activity is also triggere d by the specific regulatory framework of the 
sector.  For instance, during the period under review both Lufthansa and Air France-KLM had to launch a share buy-back, self-control scheme, as the proportion of foreign shareholding was dangerously approaching the 49 per cent threshold above which the carriers would no longer have 
been considered European-owned (or, for non-ye t re-negotiated ASAs, French-Dutch and German-
owned, respectively) and would have consequently run the risk of seeing their traffic rights denied 
abroad.   
745. In the same vein, the Canadian nationality of Ai r Canada has been challenged before the US 
Department of Transportation.   
746. In certain instances, the regulatory framework ma y also constrain the amount and the form of 
trans-national investment.  For instance, Virgin, LAN and AirAsia are now trans-national brands managed like franchises, because national investment ru les are such that, except in very rare cases 
(Virgin Blue in Australia), they cannot be, resp ectively, fully UK, Chilean or Malaysian-owned, 
except in their country of origin.  They have had to find a local partner for the 51 per cent remaining 
equity stake, for instance in Thailand (Thai Air Asia),  Nigeria (Virgin Nigeria) and Peru (LAN Peru).   S/C/W/270/Add.2 
 Page 451 
 
 
  (b) Actors involved 
747. The actors involved can be airlines and non-airlines.  Among airlines, at least three types can 
be distinguished: 
• Alliances .  Alliances have not played the prominent role in terms of trans-national ownership 
that observers initially expected.  For instan ce, whereas Transatlantic linkages are regularly 
rumoured, they have thus far failed to mate rialise and are now fewer than in the 1990s, 
whereas the degree of operational and commerc ial integration of carriers has notably 
progressed.   
• Strategic partners .  In privatisation processes, governments often look for a major airline as a 
"strategic partner", typically with a 25 per cent st ake.  In such instances,  the shareholding is a 
kind of symbol of the degree of involvement in the management of the newly privatised airline.  
• Code-sharing partners
.  Symbolic exchanges of shares may take place with code-sharing 
partners. 
748. Among non airlines actors, the period under review has witn essed the emergence, alongside 
local institutional investors that ar e traditionally present in privatisation processes, of private equity 
funds, the most prominent of which being the Tex as Pacific Group, Macquarie and Apax Partners.  
This is, at the same time, good and bad news for th e air transport sector.  On the one hand, it proves 
that the sector can potentially be profitable and attr act serious investors that have the capacity to 
support development plans.  On the other hand, it may generate a short- term management vision 
which may be difficult to reconcile with the long-te rm strategic planning that the sector requires.  
Nevertheless, it is possible that these dynamic and po werful new actors may, in the long run, have an 
impact on the traditional regulatory framework that has governed the sector thus far.