IAG bans non-EU investors

International Consolidated Airlines Group (IAG) announced a ban on the purchase of shares by non-EU investors this week as it moves to comply with EU ownership-and-control rules post-Brexit.

IAG, owner of British Airways, Iberia, Vueling and Aer Lingus, will limit non-EU shareholders to a combined stake of 47.5% in the group.

Any share purchase above this “permitted maximum” will automatically lead to a suspension of voting and other shareholders’ rights for the non-EU purchasers, who will be required to dispose of the shares within 10 business days.

The restriction will not apply to UK investors who will be classed as “non-EU” following Brexit.

IAG gave notice that shares held by “relevant non-EU persons” in the group had reached 47.5% of the total this week as it imposed the ban on further share purchases.

The group has not said how it will deal with UK shareholdings. However, IAG said it has “no plans to issue such a notification” of restrictions to “UK persons” purchasing shares.

EU rules require Europe’s airlines to be 51% owned and controlled by EU entities to benefit from open skies and to operate between any two airports in the European Economic Area (EEA).

The EU recently confirmed airlines will have seven months to comply with the ownership-and-control rules once Britain leaves.

The UK government has said it will impose no restrictions on EU airlines operating to Britain.

IAG has consistently declined to reveal the balance of EU, UK and non-EU shareholdings in the group, which is registered in Spain and listed on both the London and Madrid stock exchanges.

But chief executive Willie Walsh has insisted he is confident IAG will comply with the post-Brexit rules.

The Spanish government has said it will recognise Iberia as a Spanish carrier post-Brexit, although EU sources have questioned whether this would be enough to meet the EU requirements.

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