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Vietnam to Raise Airline Foreign Ownership Limits

: Jul 23, 2018 - : 11:41 pm

The Vietnam government has proposed raising foreign ownership limits in a domestic airline from 30 per cent to 49 per cent, while still ensuring that a Vietnamese individual or legal entity remains the major shareholder.

 

The proposal would amend Decree 92/2016/ND-CP, which aims to open the commercial aviation business to more foreign investors. The law governs commercial activities in the civil aviation field, including airlines and airports, stated a report in Air Transport World.

 

The government also plans to double minimum capital requirements for establishing an airline operating up to 10 aircraft from VND300 billion (US$13 million) to VND700 billion.

 

For an airline startup with 11-to-30 aircraft, the capital requirement would increase from VND600 billion to VND1 trillion. For fleets with more than 30 aircraft, the value would rise from VND700 billion to VND1.3 trillion. This law would now apply to both local and foreign startups.

 

In addition, starting and maintaining an airport enterprise would require a minimum capital of VND200 million, for both domestic and international airports, compared to the previous VND100 million for domestic. This move is likely to encourage the growth and quality of international airports in the country to ease pressure on major hubs. Airports such as Ho Chi Minh City’s Tan Son Nhat International is already starting construction of additional infrastructures to increase its handling capacity to around 40 million annually.

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