11:55 AM EDT, 06/19/2025 (MT Newswires) -- Canada's Competition Bureau on Thursday recommended governments liberalize the domestic airline industry and allow increased foreign ownership to boost competition and lower fares for travelers.

The Bureau's market study report recommends raising the limit for single-investor foreign ownership from 25% to 49% for airlines in general, and to 100% for "domestic-only Canadian airlines" but also acknowledged the difficulties of maintaining competition.

The report cited Australia's relaxed rules which have helped carriers like Virgin Blue, Tiger Airways, and Bonza start up in that country. However, it also acknowledged that the Australian market has faced recent setbacks and reduced competition, highlighting the challenges of maintaining a competitive market.

The domestic market is highly concentrated and competition from new sources remains "fragile" with Air Canada ( ACDVF ) and WestJet together accounting for half to three quarters of all domestic passenger traffic, the report found. As far as regional routes are concerned, the Bureau said such routes could be supported directly with subsidies that airlines bid for. "No airline - Canadian or foreign - has to fly routes that lose money," it said.

The airline market study was launched last July.'

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