Ryanair freezes out UK investors to keep flying in EU post-Brexit

Saleha Riaz
·2 min read
Ryanair said last year it will take steps to ensure it “will remain majority EU owned and controlled following Brexit." Photo: Getty Images
Ryanair said last year it will take steps to ensure it “will remain majority EU owned and controlled following Brexit." Photo: Getty Images

British shareholders in Ryanair (RYA.L) will lose their voting rights and Britons will no longer be allowed to buy new shares as of 1 January, when the UK will formally cease to be a member state of the EU, so that the airline can retain full licensing and flight rights in the bloc.

However, UK nationals will not be required to sell any ordinary shares which they owned prior to 1 January.

The company had decided in March 2019 that it will take steps to ensure it “will remain majority EU owned and controlled following Brexit. This is necessary to ensure continued compliance with the airline ownership and control requirements of EU Regulation 1008/2008,” it explained.

As of 1 January, all ordinary shares and depositary shares held by or on behalf of non-EU nationals, including UK nationals, will be treated as "restricted shares," it said, and the holders of such shares “shall not be entitled to attend, speak or vote at any general meeting of the company.”

“These resolutions will remain in place until the Board of the Company determines that the ownership and control of the Company is no longer such that there is any risk to the airline licences held by the Company's subsidiaries pursuant to EU Regulation 1008/2008,” the airline said.

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Ryanair had earlier explained on its website that EU law requires it to be majority owned and controlled by EU nationals.

This meant that in the event of Brexit, its UK shareholders would become non-EU nationals, and this could result in Ryanair, for a temporary period, being majority non-EU owned and controlled, putting its EU airline licence at risk.

It added that while its board has the power to require a sell-down of shares by non-EU shareholders, it is not planning any such sell-down. It also said that when a UK shareholder decides to sell, they will only be permitted to sell to an EU national.

Ryanair had said last February that while the airline was 55% EU-owned, Britain-based shareholders at the time controlled around 20% of its stock, according to a Reuters report.

Last week, Ryanair announced it had cancelled some UK domestic services after it claimed the country’s Civil Aviation Authority imposed rules that made the operation of those flights impossible. However, the CAA has said the rules aren’t new.

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