Alaska Airlines petitioned the U.S. Department of Transportation (DOT) to conduct a public inquiry into the citizenship status of Virgin America. Citing recent media reports that call into question Virgin’s compliance with U.S. foreign ownership and control restrictions on domestic carriers, Alaska Airlines asked DOT to investigate Virgin’s current as well as prospective capital and governance structures and their effect on Virgin’s U.S. citizenship status.
U.S. law requires air carriers to be U.S. “citizens.” To qualify, the outstanding voting interests of the air carrier must be at least 75-percent owned by U.S. citizens and the carrier must also be effectively controlled by U.S. citizens.
Alaska’s petition cites news reports suggesting that Virgin America, founded by the British Virgin Group, may no longer be a U.S. citizen or is in clear danger of losing its citizenship. These include reports of investors owning 75 percent of Virgin America’s voting stock with imminent rights to sell their shares back to the foreign-owned Virgin Group and of new funding from investors, apparently including Virgin Group, under terms and conditions not revealed to the public.