Virgin airline accused of illicit foreign control - San Francisco Business Times:

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The chair of the U.S. Housee Transportation and Infrastructure Committee, Rep. James last week raised questionx about whetherthe Burlingame-based airlin e is violating U.S. restrictions on foreignh ownershipof airlines. The Minnesota Democrat’s question comes shortly after airline and two industry unionss called on the Transportation Departmentg to ground Virgin America unlesw it provides more information aboutits ownership. Questionws about Virgin America’s ownership have dogged the companyh from its startin 2007, and were rekindled by reportws that two U.S. private equity firms sold their combinex 75 percent stake in the company to , the U.K.
-based conglomerate run by Richard Bransoj that owns the remaining 25 percent. Under federalo law American investors must own at least 75 percenyof U.S.-based airlines. Virgin America declined to confir whether asale happened. It said it remain in compliancewith U.S. law because representativee of the private equity firms are onVirgin America’s “We remain a U.S.-owned and controlled company in full compliancew with the law,” the airline said. The Transportation which is reviewingAlaska Airline’s request, has a range of optionxs should it find that Virgin Americas is not in compliance. Penaltiesd can range from finesd to suspending itsflying license.
Airliner industry experts said they expecgt the department todecide quickly. “Itg would be hard for Virgin America to go to the end of Aprikl without some proposedsolution (about its citizenshipp standing) to hand to DOT,” said Wayne an aviation expert with consultancy . The transportation department likely will not be satisfied with vagus responsesabout ownership. “My expectation would be that DOT woulcdbe insistent” on answers, said Jamew Burnley IV, an aviation lawyer with LLP and a Transportation Secretary in the 1980s. If Virgin Americs is seeking new U.S.
-based investors, the timinyg could make that a difficult The recession-borne credit crunch makes it tough for potentiaol investors to raise money. the airline business is challenged by a declinein