Alaska Airlines said in a statement that recent media reports call into question Virgin America’s compliance with U.S. foreign ownership and control restrictions on domestic carriers.
However Virgin America refutes this, saying it is a U.S.-controlled and operated airline and is a separate company from Branson-owned Virgin Atlantic. It adds that Virgin Group is a minority holder in Virgin America, owning 24 percent.
The two carriers compete on routes to Seattle and other cities along the US West Coast. Alaska has questioned its competitors “US citizenship” and petitioned the US Department of Transportation to launch an inquiry into its ownership structure.
Under U.S. Federal laws foreign ownership of domestic airlines must not exceed 25 percent.
“Only through a careful and ongoing review of Virgin America’s recent actions conducted on the public record can the DOT and public be assured that Virgin will remain a U.S. citizen,” said Keith Loveless, general counsel for Alaska Airlines.
Virgin America began service in 2007 after a lengthy battle in Washington over its rights to operate domestic flights and the company’s ties to Virgin Group.
In a statement released by Virgin America spokeswoman Abby Lunardini said: “We are a U.S. owned and controlled airline that is in full compliance with the law and all Department of Transportation regulations. Nothing has changed in our ownership structure which was approved by the DOT. Should our ownership structure change in the future, we will of course notify the DOT in advance, so they can confirm our continuing compliance.”