Airlines not majority-owned by EU nationals or companies risk losing ability to fly within bloc

This article is more than 1 year old

This article is more than 1 year old

British citizens who own shares in Ryanair will be barred from buying more stock, voting on company resolutions or attending annual shareholder meetings if a no-deal Brexit goes ahead, the Dublin-based carrier said on Monday.

EU regulations require that airlines flying under a European licence must be majority-owned and controlled by shareholders from the trading bloc.

Ryanair said that to comply with these regulations it would have to restrict the rights of British shareholders, who control about 20% of the company’s stock, to bring them into line with other non-EU investors.

It said this would reduce the risk that the proportion of its shares held by EU nationals falls from around 55% to below half.

Ryanair’s London-listed shares fell by more than 2% by midday on Monday.

The outspoken chief executive, Michael O’Leary, has been a vocal critic of the government’s handling of Brexit, warning that no deal is increasingly likely.

While he has largely focused on the potential negative impact on airlines flying between the UK and EU, Ryanair confirmed that its investors would also be affected.

Investors would not be required to sell their stock but would lose rights they had previously enjoyed, including the ability to attend annual general meetings and speak or vote at them.

If they do decide to sell the shares, they will only be allowed to sell them to an EU national and will not be permitted to buy any more.

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Ryanair said the constraints on UK investors, confirmed through resolutions passed at a board meeting on Friday, would apply from what it called “Hard Brexit Day”, which will be 29 March if no deal is reached with the EU before then.

In a statement to the stock market, Ryanair said: “These resolutions will remain in place until the board 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.”

Ryanair has previously published a guide to the ramifications of a hard Brexit for its UK shareholders, explaining its rationale for the decision and claiming it has no alternative.