New development around Norwegian Air Shuttle (NAS) and one of its many European subsidiaries: this time Norwegian Air UK’s (NAUK) is in the spotlight after the US Department of Transportation (DoT) rejected its foreign air carrier permit exemption application. This decision is of major significance because it echoes ECA and US pilots’ concerns about Norwegian using shell subsidiaries, such as Norwegian Air International (NAI) and Norwegian Air UK (NAUK), to operate under a “Flag of Convenience” and undermine labour and social standards.
The decision is not definitely cutting Norwegian’s access to the US market – it is only a signal to Norwegian and the other airlines – operating under a “flag of convenience” business model and resorting to unfair competitive practices that they will face scrutiny. NAUK is a UK airline (on paper), whose employment structure for its pilots and flight attendants, similarly to NAI, Norwegian’s Irish based subsidiary, is unclear.
The US DoT says that NAUK’s request raises “novel and complex” issues and that granting an exemption would not be in the public interest. By dismissing the application, the company’s business model will now have to face the careful scrutiny it deserves. Concretely, it means the US DoT will continue to review the NAUK’s foreign air carrier permit application. At the same time, the US DoT is still reviewing NAI’s foreign air carrier permit. After it granted a tentative approval in April, its final decision is still pending.