Vietnam Business Channel

Vietnam will open up its airline market and allow for increased foreign ownership

Aircraft at Ho Chi Minh City’s Tan Son Nhat International Airport.

If you’re interested in starting an airline then Vietnam is the place to be! From January 1, 2020 Vietnam will lower the minimum capital requirement for airlines and will also increase the amount of ownership that foreign companies can own new carriers.

Currently the minimum capital needed to establish an international airline is $30.3 million USD (700 billion VND), which will be lowered to $13 million USD (300 billion VND) next year. The lower capital requirements are for airlines with 10 aircraft or less.

For new airlines that plan to own 11 ~ 30 aircraft, the minimum capital requirement has been lowered from $43.2 million USD (1 trillion VND) to $25.9 million USD (600 billion VND). For airlines that plan to operate more than 30 aircraft, the capital requirements will be lowered from $56.2 million USD (1.3 trillion VND) to $30.3 million USD (700 billion VND).

Related to foreign ownership of airlines, the no regulations increase the foreign ownership cap in a domestic airline from 30% to 34%, with a stipulation that there must be at least one Vietnamese individual or company holding the majority stake.

Finally, the new regulations removed certain restrictions on aircraft age that did allowed for carriers to import aircraft that were more than 10 years old from manufacturing date, and to operate aircraft that were more than 20 years old.

Vietnam currently has six domestic carriers: Bamboo Airways, Jetstar Pacific, Vietjet, Vietnam Air Services Company (VASCO), Vietnam Airlines and Vietstar Airlines.

Airline industry observers are expecting at least two more companies applying for airline licenses early next year and by the end of 2020 there could be as many as 10 airlines flying domestic and international routes.




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