LCC Norwegian has received full approval from the US Department of Transportation (DOT) for its UK subsidiary, Norwegian UK (NUK), to start transatlantic operations.

The DOT granted approval on Sept. 22, firming up an earlier tentative agreement after a lengthy and controversial decision-making process.

Norwegian set up London Gatwick-based NUK in 2015 to access European Union (EU) traffic rights and support its ambitious growth strategy. However, the US foreign air carrier permit application stirred up vocal objections from mainly from US flight crew unions focused on Norwegian’s labor practices.

DOT came under pressure from the European Commission to uphold the EU-US Open Skies agreement and a number of airports and airlines – including Irish LCC Ryanair and several US cargo airlines – came out in favor of Norwegian’s application. By operating out of bases in EU countries like the UK and Ireland, Norwegian qualifies to fly transatlantic services covered by the EU-US Open Skies accord.

In its final ruling, DOT said it rejected the labor objections and, after thorough consideration,  ruled in Norwegian’s favor. “We have decided to finalize our tentative decision…and grant Norwegian UK’s request for a foreign air carrier permit,” DOT said.

“The labor parties have offered no arguments not already considered, and rejected. We therefore see no persuasive reason for the department to withhold Norwegian UK’s permit authority, or, in granting that authority, to impose any of the conditions proposed by the labor parties.”

Norwegian welcomed the approval, which gives the green light for NUK to start operating flights between the UK, Europe and the US, effective immediately.

“With a US foreign carrier permit also now received for NUK, Norwegian will be able to establish a seamless operation and more effectively utilize its long-haul fleet – this includes the use of the same aircraft across all long-haul routes including the US, Singapore, Argentina and other future long-haul markets,” Norwegian said.

While waiting on the US approval, NUK had already detailed plans to launch with flights to Singapore later this month and Argentina from February 2018. Norwegian CEO Bjørn Kjos described the clearance as “the final piece of the jigsaw.”

“Work will now begin to establish which elements of Norwegian’s existing long-haul operations (including new and existing routes, aircraft and crew) will be operated by the NUK subsidiary in future,” Norwegian said.

Norwegian already has a heavy UK presence using its Norwegian air operator’s certificate (AOC), including US routes, but NUK gives it greater market access because Norway is not a member of the EU.

Dublin-based Norwegian Air International (NAI) also went through a lengthy battle to secure its foreign air carrier permit. In a further move, Norwegian is setting up another subsidiary airline in Argentina.

“We have applied for a license in Argentina. We are in the process with that and will probably come back to that later this year. You will see us grow into all continents. We have grown most into North America. We will not set up operating licenses everywhere; we will expand through organic growth, with new routes to different continents,” Norwegian CFO Tore Ostby told ATW in a recent video interview.

Victoria Moores victoria.moores@penton.com