Australian Treasurer Allows Qatar Airways Stake In Virgin Australia

The Australian government has approved Qatar Airways’ investment in Virgin Australia, which is an important part of the multifaceted partnership proposed by the two carriers.

Australian Treasurer Jim Chalmers ruled that Qatar Airways can proceed with its plan to purchase a 25% minority stake in Virgin Australia. This follows advice from the Foreign Investment Review Board (FIRB) that the investment is in the public interest.

“On the advice of FIRB, I have approved this proposal subject to legally enforceable conditions that ensure Australian representation on Virgin’s board and protection of its customer data,” Chalmers said.

Another key aspect of the partnership is a proposal for Qatar Airways to wet-lease Boeing 777-300ERs to Virgin so the Australian carrier can launch flights from Australian cities to Doha.

This step “will increase Virgin Australia’s capacity on key international routes and provides a long-term pathway for the airline to operate its own long-haul flights,” Chalmers said.

Virgin and Qatar Airways have provided assurances that the partnership will create employment opportunities for Australians.

They have committed to creating a “structured secondment program,” where 20 pilots and 40 cabin crew from Virgin will be sent to Doha to gain long-haul flying experience, and at least 60 positions will be backfilled in Australia.

The carriers have also committed to consult with unions on the potential for Virgin to start dry-lease operations using its own crew, no later than three years into the partnership.

The Australian Competition and Consumer Commission has already granted draft approval for closer cooperation between the two airlines for five years, including the wet-lease arrangement.

Final approval from the ACCC is expected in March or April.

The airlines must also gain clearance to start the wet-lease routes from Australia’s International Air Services Commission, which is expected to grant approval.