India’s civil aviation ministry is scrutinising an agreement between the partners of AirAsia India that is said to give Malaysia-based AirAsia Bhd control over the airline.
Indian law allows a foreign airline to own up to 49 per cent of an Indian one, but the Indian airline has to be controlled and run by Indian partners, according to a report in Livemint.com
AirAsia Bhd, through AirAsia Investment Ltd, owns 49 per cent in AirAsia India, the Tata group owns 49 per cent and two directors in the firm – S Ramadorai and R Venkataramanan – hold the rest.
The problem, according to Livemint, is a brand licence agreement that was subsequently signed by AirAsia India and AirAsia Bhd which effectively grants control of the former to the latter in contravention of Indian law.
Part of this agreement says AirAsia India “will observe and comply strictly with the following operating requirements which are to be determined in AirAsia’s sole discretion”.
13/10/16 FMT News
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Indian law allows a foreign airline to own up to 49 per cent of an Indian one, but the Indian airline has to be controlled and run by Indian partners, according to a report in Livemint.com
AirAsia Bhd, through AirAsia Investment Ltd, owns 49 per cent in AirAsia India, the Tata group owns 49 per cent and two directors in the firm – S Ramadorai and R Venkataramanan – hold the rest.
The problem, according to Livemint, is a brand licence agreement that was subsequently signed by AirAsia India and AirAsia Bhd which effectively grants control of the former to the latter in contravention of Indian law.
Part of this agreement says AirAsia India “will observe and comply strictly with the following operating requirements which are to be determined in AirAsia’s sole discretion”.
13/10/16 FMT News
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