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Home  >>  Daily News  >>  Vietnam News  >>  Capital Markets  >>  Vietnam clears AirAsia’s stake purchase in VietJet
NEWS UPDATES 3 April 2010

Vietnam clears AirAsia’s stake purchase in VietJet

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Vietnam’s Ministry of Transport has rejected a demand by Vietnam Airlines to prohibit Malaysia-based AirAsia from buying a 30 per cent stake in VietJet Aviation, saying there is no legal provision to do so, local news agency VNS reported.

Following AirAsia's announcement last month that it was picking up the stake and establishing a low-cost airline in Vietnam called Vietjet-AirAsia, the national carrier wrote to the government office: "... With its plan to co-operate with Jetstar to form a cost-based alliance …, AirAsia's investment in Vietjet is a big concern for Vietnam's aviation market."

Deputy Minister of Transport Pham Quy Tieu has now written to the government office attesting the legality of the acquisition.

The Enterprise Law, the Law on Investment, the Civil Aviation Law, and Decree No 76 on Air Transport Business Activities allow foreign investors, whether or not they are airlines to invest in the aviation sector as long as they comply with regulations, he said.

The 2006 Vietnam Civil Aviation Law and Decree No 7 stipulate that foreign ownership in a carrier should not exceed 30 per cent.

VietJet AirAsia is scheduled to start operations in May, flying to both domestic and international destinations.


 

 

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