Air transport undertakings must have a valid operating licence issued by the Directorate of Civil Aviation (Direction de l'Aviation Civile - DAC) if they intend to transport passengers, mail or freight by air in return for payment.
In order to obtain the operating licence, the air transport undertaking must first meet several prerequisites such as:
- professional integrity of the company's managers;
- verification of the nature and structure of the company;
- be in possession of one or more aircrafts (either as the owner or under a dry lease contract;
- compliance with the financial requirements (sufficient financial capacity);
- compliance with the requirements in terms of specific insurance for aviation activities (with regard to passengers, their luggage, airfreight and third parties).
Each air transport undertaking is authorised to transport passengers, mail and freight against payment, provided they have a valid operating licence and a valid air operator certificate (AOC).
The air operator certificate attests to the professional capacity and necessary organisation to guarantee the safety of operations.
Air transport undertakings who intend to apply for an operating licence in order to transport passengers, mail or freight by air must have their main establishment in Luxembourg and agree to an examination of certain aspects of a legal nature, such as:
- the verification of the nature and structure of the company;
- the composition and nationality/ies of its shareholder base;
- the professional integrity of the company's managers;
In order to obtain the operating licence, a business must first prove that:
- its main activity is air transport only, or air transport combined with any other commercial activity concerning the operation of aircrafts or the repair and maintenance of aircrafts;
- the undertaking is owned and effectively managed whether directly or by majority participation by EU Member States and/or nationals of EU Member States.
Air transport undertakings who apply for the operating licence for the 1st time must show that they:
- can meet, at any moment, their current and future financial obligations based on realistic assumptions for a period of time of 24 months as from the beginning of operations;
- can cover, for a period of 3 months as from the beginning of operations, their fixed charges and operating costs from their activities, in accordance with their business plan and based on realistic assumptions, without recourse to the income from their activities.
Application for an operating licence
In order to obtain an operating licence, the business must apply by mail to the Directorate of Civil Aviation (DAC). The application must be accompanied by the following documents:
- a business plan for the first 3 years of operation;
- and, preferably, a targeted market study.
Moreover, the business must provide proof of sufficient financial means to cover possible financial difficulties and assume civil liability.
Withdrawal or suspension of the operating licence
The Directorate of Civil Aviation can withdraw or suspend the licence in the event of:
- financial problems of the business: in this case, the authority issuing the licence must assess the financial performance;
- uncertainty concerning its financial obligations over the next 12 months;
- the withholding of financial and accounting information;
- the communication of incorrect financial and accounting information;
- non-compliance with the requirements in terms of professional integrity of the business managers;
- the withdrawal of the air operator certificate (AOC);
- non-commencement of operations within 6 months following the issuance of the operating licence;
- the interruption of activities for a period in excess of 6 months.