While many frequent fliers in Canada were excited about the prospect of the country’s new low-cost carrier, it seems the company is having some trouble taking off.

Canada's low-cost carrier will not be taking off anytime soon.

Canada’s low-cost carrier will not be taking off anytime soon. Image by NewLeaf

New Leaf, which announced its launch earlier this month, promised fares as low as $89 CAD for a one-way ticket. But this week, the company announced it will delay sales and refund tickets while it deals with concerns surrounding its license to operate.

The company said it would begin flying between seven Canadian cities starting 12 February. The tickets that were sold will now be refunded and ticket sales halted pending a review by the Canadian Transportation Agency (CTA) of the licensing regulations for indirect air service providers.

While NewLeaf was responsible for ticket sales, it was partnered with Flair airlines which would provide the airplanes and the license.

The company launched “because it was confirmed that we were in full compliance of CTA licensing regulations”, said CEO Jim Young in a statement. He said the company plans to operate under a charter arrangement with Flair, which held the proper operating license, and the CTA gave NewLeaf an exemption from holding its own license while it reviews its legislation.

Now, the company is trying to ascertain whether it needs its own license to operate in the future.

NewLeaf says it plans to resume taking reservations in the spring, adding that thousands of people had already made bookings with the company, showing a demand for its service.

Read more: New low-cost airline launches in Canada