Wizz Air To Enter Malta With New Subsidiary

wizz air airbus a320 registration HA-LVW seen at EDDB. Photo Credit Joris Wendt/AviationSource
Photo Credit: Joris Wendt/AviationSource

LONDON – Wizz Air, the leading and ever-growing European Ultra-low-cost carrier have announced its intentions to enter Malta by forming a new subsidiary.

The carrier has announced its intention by a press release stating its plan to enter the Maltese market by forming a new airline.

The eye-catching statement in the press release stated that:

“Wizz Air, Europe’s fastest-growing ultra-low-cost airline and one of the most sustainable, announces that based on the ‘Arrangement on Reallocation of Responsibility’ document signed today between the European Union Aviation Safety Agency (“EASA”) and the Malta Civil Aviation Directorate (“CAD”), it intends to file an application for its Maltese subsidiary to be granted an Air Operator’s Certificate (“AOC”) with EASA and an Operating Licence (“OL”) with CAD.”

The newly formed airline will be named ‘Wizz Air Malta’ and is all set to launch by October 2022.

The new Wizz Air Malta will be equipped with fleets that will be registered under Maltese registration, similar to the Wizz Air subsidiaries in the UK and Abu Dhabi.

Wizz Air Chief Executive Mr. Jozsef Varadi has expressed his excitement about the new move by saying:

“We are pleased to announce our intention to establish a new airline subsidiary in Malta. Wizz Air is constantly evaluating the structure of its business and exploring options to establish new AOCs and bases in Europe and beyond.”

“The successful establishment of Wizz Air Malta later this year will help to reinforce our strong position and support our expansion plans in Europe. We look forward to working with EASA and the Maltese CAA to take this application forward.”

Wizz Air and Its Subsidiary formation Strategy

The leading European ULCC Wizz Air has always shown its inclination towards its subsidiary-centric operational strategy.

The carrier has always been inclined to operate under a subsidiary even though it has given them few setbacks and has not been as successful as that of Wizz Air Abu Dhabi.

With its first attempt at Wizz Air Bulgaria in early 2005, the airline was forced to shut its operation in 2011 with limited success and growth potential.

Similarly, Wizz Air Romania, which was planned but never successfully took off was forced to drop from the subsidiary strategy.

However, Wizz Air Ukraine was operating successfully between 2008 till 2016, when it had to stop its operation due to Russia and Ukraine tensions reaching a new level with military intervention.

With its Subsidiaries in Abu Dhabi and the United Kingdom, the carrier has been enjoying the perks of its successful subsidiary formation strategy with growth potential seen in both the markets and post-pandemic demands uplifting their performance. 

Aiming for Malta

Wizz Air’s intention to open its next subsidiary in Malta is seen as a strange but bold move by the aviation industry in Europe.

But the wise move of its choice of Malta for subsidiary strategy will bring Wizz Air an abundance of goodwill.

The aviation costs associated with the formation, registration, and operation are effectively lower as compared to that of various jurisdictions in rest of the Europe.

Another amplitude of befitting that will boost Wizz Air Malta’s operational and financial records in terms of tax, as the country offers a lucrative tax regime for attracting aviation activities in the country.

Since non-residents can claim tax refunds, the net cumulative corporate tax will be applied between 0 to 5% as compared to that of 35% for the residents.

Furthermore, the Maltese tax regime also adds benefit to the carrier as income from international transportation of goods and passengers outside of Malta is also exempted.

As Malta is an EU member state, Wizz Air will be benefited from permitting free aircraft movement across Eurozone, allowing carriers to utilize tax-free commercial operations.

Speaking on this move by Wizz Air, Capt. Charles Pace, Director General of the Civil Aviation Directorate Malta expressed,

“It is an honor to have Wizz Air as one of the airlines selecting Malta as one of their Principal Places of Business.”

“The team effort and approach of CAD have once again been proven to be a winning formula. I would like to take this opportunity to thank the CEO and Board of Wizz Air for their trust, and I look forward to working with EASA and Wizz Air in issuing the AOC and AOL.”

With a growing number of airlines looking to rebound after two harsh years infested with Covid-19 uncertainties, Executive Director of EASA, Patrick Ky said that:

“This will be a new step in the already well-established cooperation between the Agency, the Maltese Civil Aviation Directorate, and Wizz Air.”

“This new set-up, where one group will operate multiple AOCs based in different Member States, but overseen by the same Competent Authority, demonstrates the possibilities available through the transfer of responsibilities to EASA.”

“We are looking forward to working together on the issuance of this brand-new AOC and the subsequent oversight activities.”

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