Federal review threatens Flair Airlines’ licence ahead of Windsor launch

Flair Airlines arrived in Windsor last week to great fanfare, offering return flights to numerous destinations under $100.

But a federal watchdog is now threatening to suspend Flair’s operating licence over concerns it’s not Canadian-owned enough to meet federal requirements.

The Canadian Transportation Agency (CTA) alleges too much of the Edmonton-based airline’s operations are controlled by American interests and not Canadians, as defined in the Canada Transportation Act.

According to a preliminary review from the CTA, Miami-based investor ‘777 Partners’ has more than half of Flair’s board seats and leases the airline its jets. Because of that, it says Flair “may not be controlled in fact by Canadians.”

In order to be a licensed domestic airline, the company must be incorporated in Canada and at least 51 per cent of voting interests must be owned and controlled by Canadians, according to the CTA.

Flair is seeking an 18-month exemption from the transport minister so it can make certain changes to address concerns.

Flair has 60 days to respond to the CTA’s preliminary review, which is May 3, after which the airline’s operating licence could be suspended.

In a recent statement to CTV News Kitchener, Flair President and CEO Stephen Jones refutes those claims.

"Flair Airlines is a Canadian airline and is controlled by Canadians both in law and in fact. Flair Airlines, at all times, operates its business in compliance with the laws and regulations governing air transportation in Canada,” he said in the statement. “Customers can absolutely book with confidence, and we look forward to welcoming them aboard this summer.”

Dr. Gabor Lukacs, president of Canadian nonprofit Air Passenger Rights, says the regulations are in place to protect the aviation industry from outside interests.

“It is not something that I can see causing an immediate harm to passengers if we are talking about 18 months that Flair is asking provided there are some safeguards to ensure passengers do get the flights for which they’ve paid,” Luckas tells CTV.

But others in the industry aren’t as certain.

”I don’t know who’d be booking right now quite frankly with Flair, with this uncertainty lying over them at this point,” says Martin Firestone, a travel insurance broker and president at Travel Secure Inc.

Firestone has spoken with all of the big insurers and says if a flight is cancelled over this issue it will not covered by trip insurance.

“I have reviewed and spoken to all insurers today and I can unequivocally suggest that trip cancellation will not cover the default of a supplier in this case,” he says.

“People better be prepared that if they in fact do purchase a ticket, they need reassurances from the airline themselves that if you aren’t flying that day and I cannot travel on your airplane, you will refund me all monies I have put out,” says Firestone.

Flair Airlines announced discounted flights from Windsor to Tucson, Ariz. starting in the winter of 2022, as well as direct flights to both Montreal and Halifax.

The flights to Montreal will be $29 dollars in each direction, departing Thursdays and returning Sundays, starting July 7, 2022.

A Windsor to Halifax flight will be $29 dollars there and $49 to return, departing Fridays and returning Monday, starting July 8, 2022.

Windsor International Airport CEO Mark Galvin would only say the airport supports Flair going through the process with the federal government. Galvin declined to comment further, saying it’s up to the airline to navigate the process.

-With files from CTV’s Sydney Upright and Stephanie Villella