Australia eases foreign ownership rules for Qantas

Australia will relax some foreign ownership rules for national airline Qantas, the government said Wednesday, easing the way for the "Flying Kangaroo" to form an alliance with an overseas carrier.

Qantas will remain majority 51 percent Australian-owned -- a condition considered in the national interest -- but rules capping foreign individual ownership at 25 percent and overseas airline stakes at 35 percent will go.

"This will increase Qantas's ability to compete for capital and to take opportunities to form strategic partnerships in an increasingly globalised industry," Transport Minister Anthony Albanese said.

In a paper to guide the aviation industry for the next two decades, the government also eased rules for hand luggage -- with tweezers, knitting needles and nail files no longer banned on flights and metal cutlery reintroduced.

In contrast, screening of baggage and individual passengers will be tightened.

"It is time to do more than have an ad hoc approach to aviation issues as they arise," Albanese told reporters in Canberra.

"Australia needs a comprehensive aviation framework that brings together all aspects of aviation policy into a single, coherent and forward-looking statement."

The minister said the government would also encourage foreign airlines to increase their services outside the major arteries of Sydney and Melbourne to secondary international airports such as Cairns, Darwin and Broome.

"Australia will offer foreign airlines unlimited access to secondary gateway markets... and offer improved access to major destinations for those international flights which go through tourist venues such as Cairns," he said.