EasyJet starts new European airline as Brexit risks route access

EasyJet Plc will create a new airline based in Vienna that will shield its routes within the European Union from any fallout from Britain’s negotiations to exit the bloc.

The approval process for an air operator certificate that EasyJet filed with Austria’s aviation regulator is “now well advanced,” and the Luton, England-based company expects clearance in the near future, the carrier said in a statement Friday. The new carrier, dubbed EasyJet Europe, will form one of three airlines owned and operated by the company alongside U.K. and Swiss operations. EasyJet will re-register 110 planes with the new unit.

EasyJet is seeking to protect its rights to fly between destinations in EU countries after Brexit takes effect, in the event the U.K. fails to reach an agreement on retaining access to those routes for its airlines. About half of EasyJet’s passengers originate from airports elsewhere in the EU, and about 30 percent fly on routes linking airports of the bloc’s other 27 countries, making it one of the carriers most exposed to policy changes from Brexit.

The airline is still pushing for authorities to reach a deal allowing U.K. and mainland-Europe airlines to operate freely across the tighter border.

The EasyJet parent will meet the bloc’s ownership restrictions on airlines because it will be majority-owned by EU nationals, it said. Investors from the other 27 EU countries currently own “close to half” of EasyJet’s stock, including the 33 percent held by founder Stelios Haji-Ioannou and his family, who are citizens of Cyprus.