The government wants to expand from 20% to 100% limit of foreign equity ownership in Brazilian domestic airlines, since Brazilian companies have the same right in other countries. The full market opening was supported by the head of Civil Aviation Policy Department of the Ministry of Defence, Fernando Soares, during a public hearing of the special committee that examines changes in the Brazilian Air Force Code.

The main proposal (PL 6716/09) changes the percentage to 49%, but a project presented by the Executive Branch this year (PL 6961/10) that follow the procedures appended, extends the limit to 100%.

According to the technician of the Ministry of Defence, it does not matter the origin of the capital, as long as the regulation and supervision are based on Brazilian law. Fernando Soares supports the concept adoption of economy internationalization for the industry.

"This is an opportunity to further enhance air services in Brazil. It will increase the number of companies, increase the number of offers, we will have more competition, better service quality and greater number of locations served", he said. “At the same time, the Brazilian company also may invest in other countries."

The president of the National Civil Aviation Agency (ANAC), Solange Paiva Vieira, supported the expansion of foreign participation. She said companies like Lan, from Chile, and Avianca, from Colombia, are pending the approval of the proposal to enter the Brazilian market.

Overbooking
The rapporteur of the special committee, deputy Rodrigo Rocha Loures (PMDB-PR), stressed that the proposals include other issues such as compensation due to passengers for pendency in baggage claims and flight delays.

Another theme that will be included in the report is overbooking - the practice of selling a number of tickets for a flight that is greater than the flight capacity, based on the average of non-attendance at the time of departure (known as "no show"). The representative said he intends to propose a ban on such practice.

As for the representative of the Brazilian Travel Agency (Abav), João Quirino Junior, overbooking should be allowed to avoid losses for companies, but with a 10% limit on the number of seats.

After the debate, the rapporteur said he would present his report on May 25th. He said he was optimistic about the approve of proposal in the Floor before the parliamentary recess in July.

Before the presentation of opinion, he said, four hearings will be held.

Reporting - Idhelene Macedo
Edition – Daniella Cronemberger
Translation - Grupo Solucion-SP Language/Suzana Pinheiro Lara