The federal government has approved Air Canada’s purchase of competing airline Transat A.T. Inc. under a series of strict terms and conditions the government says “are in the interest of Canadians.”
A statement released by the transport minister’s office said the impact of COVID-19 was a key factor in the final decision to approve the purchase.
“Given the devastating impact of the COVID-19 pandemic on the air industry, the proposed purchase of Transat A.T. by Air Canada will bring greater stability to Canada’s air transport market,” said Transport Minister Omar Alghabra in a media statement.
“It will be accompanied by strict conditions which will support future international competition, connectivity and protect jobs. We are confident these measures will be beneficial to travellers and the industry as a whole.”
Those conditions include: maintaining Transat’s head office and brand in Quebec; encouraging other airlines to take up former Transat routes to Europe; ensuring aircraft maintenance contracts remain in Canada, prioritizing Quebec over other provinces; launching new routes within five years; and committing 1,500 employees to the merged company’s new travel business.
The deal also stipulates that because Transat is now a subsidiary of Air Canada, it must provide bilingual services to customers across the country.