Hindustan Times (Chandigarh)

Effective control of Airasia India was with Malaysian parent, shows pact

- Rhik Kundu

MUMBAI: Products, services and pricing. Brand artwork and inflight services. Engineerin­g purchases and leasing contacts. Group manuals and staff uniform. Key decisions across the board at Airasia India needed approval from Malaysian shareholde­r Airasia Bhd, shows the brand licence agreement between the two entities.

The brand licence agreement between the two companies, dated 17 April 2013—a copy of which was seen by Mint—states that “the licencee (Airasia India) shall observe and comply strictly with the following operating requiremen­ts, which are determined in Airasia’s sole discretion”. These include “ancillary, branding, catering and inflight services, customer experience, engineerin­g, finance/corporate finance, flight operations, innovation, commercial, technology, marketing, network planning people, quality and assurances, revenue management, safety and sales and distributi­on”.

In India, regulation­s state that effective control of airline companies jointly owned by Indian and foreign entities should lie with the local company.

An Airasia India spokespers­on said that allegation­s concerning indirect foreign control of Airasia India Ltd, in violation of norms set by the Foreign Investment Promotion Board, had been fully investigat­ed by the Director General of Civil Aviation (DGCA) and it passed a detailed and reasoned 12-page order to this effect on 8 February 2017.

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