easyJet seeks third AOC after result of Brexit referendum

easyJet, Europe’s second-largest low-cost airline, has decided to seek a third air operator’s certificate and its second outside the UK in a move to protect itself against the potential problems created by the UK’s referendum result and vote to leave the European Union. easyJet Switzerland, a subsidiary of easyJet, currently holds the company’s second AOC.
easyJet had already held discussions with a number of European aviation regulators ahead of the UK referendum, but now the carrier has begun to formally seek an air operator’s certificate, the Luton, England-based carrier confirmed last week. To qualify for an AOC only three staff are required, handling ground, flight and engineering operations, while the actual process need only take a few months to complete. Should the UK be able to negotiate continued membership to the European aviation market, easyJet may also have to register its HQ in an EU member state in order to maximize its access.
The reason easyJet is exploring the workaround as 60% of its passengers are from outside the U.K., and over 40% fly on routes that don’t involve British airspace. It is these operations, built around almost 30 airport bases Europe-wide, that would be under threat in a worst-case scenario. It has also been confirmed that the carrier has been lobbying U.K. and EU leaders for the retention of a “fully liberal and deregulated” market.
Shares of easyJet have fallen by approaching 30% since the June 23 poll, which has effectively reduced its market value to 4.4 billion pounds (US$5.9 billion).
Ryanair Holdings Plc, Europe’s biggest low-cost airline, has London Stansted as its largest base, but with the company’s headquarters in Dublin it will not face the same challenges from the Brexit referendum result as U.K. carriers. IAG SA, owner of British Airways, has its head office near Heathrow airport, but also has Irish and Spanish AOC’s via its Aer Lingus, Iberia and Vueling units, and the company is registered in Madrid.
As with so much surrounding Brexit, it is far from clear what impact European Union ownership restrictions might have on U.K. airlines once Britain exits the EU. Current regulations require non-EU companies to limit their holdings in carriers from the European bloc to 49 percent.