A Spanish airline has entered into an agreement to buy a 51 per cent stake in Medavia, the Libyan-owned aviation company, in a move designed to avoid EU action against the Maltese government.
Medavia, which is based in Ħal Safi and employs about 100 staff, operates regular flights between Malta and Libya under a Maltese licence. It also operates holiday charter flights to Italy and provides aircraft management and ground handling services.
But according to EU rules, airline operating licences can only be granted to companies that are more than 50 per cent owned by an EU country or an EU national. The Sunday Times of Malta is informed that Brussels had given the Maltese government an ultimatum over the situation.
For the company the issue has been resolved and the case is closed
Government sources said a solution was found at the 11th hour, with Medavia entering into an agreement with a Spanish airline – Air Nostrum – that will buy a 51 per cent stake in the Libyan company. This will technically make Medavia a European airline which can operate under a Maltese licence.
Transport Malta, the regulator, confirmed the arrangement. “Medavia has entered into an agreement with a European partner and is compliant to EU directives and regulations. We are not in a position to divulge commercially sensitive information,” a spokesman said.
A spokesman for Medavia said: “For the company the issue has been resolved and the case is closed.”
Medavia was established in Malta in 1978 on a joint initiative of the Maltese and Libyan governments. It has been operating under a Maltese (EU) licence for years despite being fully owned by non-EU interests (Libyan).
The situation came to the attention of the EU only last year when the European Commission insisted Malta should not have let Medavia continue to operate the airline against EU rules.
Pressure was brought to bear on the company to find a solution but after lack of progress, Transport Malta gave Medavia an ultimatum: either come in line or lose the licence. According to the sources, the sale process is taking longer than predicted and shareholders are still awaiting the green light from the Libyan authorities. At the time of writing, Medavia and its subsidiaries still appeared as being owned by Libyan interests in the Maltese register of companies.
“The company needs to tackle the situation immediately if it wants to avoid action,” the sources said.
ivan.camilleri@timesofmalta.com