FOREIGN INVESTORS MAY OWN UP TO 49% OF VIETNAMESE AIRLINES

An aircarft is parked at Noi Bai International Airport in Hanoi City - PHOTO: H.T

HA NOI – The Ministry of Construction has proposed raising the foreign ownership limit in Vietnamese airlines to a maximum of 49% from the current 34%.

This proposal is found in a draft Government decree on aviation transport, which is currently being circulated by the Ministry of Construction for feedback. The proposal is aimed at attracting more foreign investment into the sector.

The current 34% cap is a significant barrier, making Vietnamese carriers less attractive to foreign investors. In 2024, industry experts noted that the limit has prevented foreign investors from having veto power or participating deeply in the decision-making process and business operations.

Neighboring countries such as Thailand, Indonesia and Cambodia permit foreign ownership of up to 49% in their local airlines. Notably, international partners were allowed to own up to 49% of Vietnamese airlines over a decade ago before the limit was tightened.

Currently, several domestic carriers, including Vietravel Airlines and Bamboo Airways, are undergoing restructuring and require more capital injections from domestic and foreign investors.

In addition to relaxing the ownership limit, the draft decree also proposes new regulations on the minimum equity required to establish and maintain scheduled commercial aviation operations.

Specifically, the ministry proposes that a company needs equity of a minimum VND300 billion (around US$11.6 million) to operate a fleet of up to 30 aircraft. For fleets exceeding 30 aircraft, the minimum equity requirement would be VND700 billion.

Under current regulations, a VND300-billion equity base only allows for a maximum 10 aircraft. Airlines wishing to operate between 11 and 30 aircraft or more than 30 aircraft must currently have equity of VND600 billion and VND700 billion, respectively.

Source: The Saigon Times