Irish authorities have issued an air operator’s certificate (AOC) and operating license to Norwegian’s subsidiary Norwegian Air International Limited, which is based in Dublin. With this permit, the administration of Norwegian’s long-haul operation will be relocated to Norwegian Air International Limited (NAI). The company has built its managerial and all mandatory regulatory functions in Dublin. Its aircraft operation will now be governed by the Irish authorities.
Norwegian established its long-haul operation in Dublin for several reasons.
- The main reason is access to future traffic rights to and from the EU. Norwegian has more than 260 aircraft on order and the route network will expand rapidly in the years to come.
- Another important reason for choosing Ireland, and not another EU country (though several other European countries were considered), is because Ireland has decided to fully adapt the Cape Town Convention, which provides Norwegian with better financing conditions. Furthermore, NAI’s establishment in Ireland does not affect export guarantees in connection with our financing.
- As well as offering one of the highest ranked civil aviation authorities in the world, Ireland is also a considerable cluster for the aviation industry; major leasing companies that Norwegian cooperates with have offices in Dublin.
Interestingly, the airline stressed the importance that Ireland was not chosen because it has specific rules and regulations allowing the use of American or Asian crew, as some politicians and unions have claimed. Norwegian could have based its long-haul company in any other EU country and still used American and Asian crew, the way several other EU airlines have been doing for years. The only exception is Norway and Denmark, which have opted to keep special employment rules.
The transfer of the first 787 to the new EU AOC was completed today. This took place in conjunction with scheduled maintenance on the aircraft. The remaining aircraft will be transferred gradually.
In regards to Norwegian’s long-haul routes to and from the U.S., the U.S. Department of Transportation is now processing Norwegian’s application for a permit. This is regulated by the Open Skies Agreement between the U.S. and the EU, which means that an operator from either party, which fulfills the requirements, should be entitled to operate under this agreement. Today’s announcement means that Norwegian meets all the requirements.
There has been a reaction of course. Competitors and unions have made a number of allegations against Norwegian and Ireland on this matter. The EU’s transport authorities, the Irish authorities and Norwegian have repeatedly refuted these. Norwegian expects that the U.S. government will process the application in accordance with the principles of the Open Skies Agreement and that Norwegian is given the same rights as were given when we operated on an EEC AOC, once the AOC is transferred from Norway to the EU.
We don’t expect pricing on the North Atlantic market will be impacted much. Norwegian’s footprint will be too small for some time to make an impact. But we do expect to see Ryanair take a very careful look at this operation. They will not appreciate any other airline in Ireland making money.