CORRECTED-Second Spanish airline applies to fly domestically in Brazil

(Corrects Feb 7 story to say Air Nostrum is independent carrier not owned by Iberia)

BRASILIA, Feb 7 (Reuters) - Spanish airline Air Nostrum, Iberia’s regional franchise airline, has become the second foreign airline to seek permission to operate domestic flights in Brazil, civil aviation regulator ANAC said on Friday.

If and when it obtains authorization, flights would start in the second half of this year under a new airline name, ANAC said in a statement.

Air Nostrum, based in Valencia on Spain’s eastern coast, is an independent carrier that operates most domestic flights for Iberia, a unit of the IAG group along with British Airways.

Last year, Spanish tourism and transportation company Grupo Globalia, which owns Air Europa, became the first 100% foreign-owned company to get a license to operate in Brazil’s domestic market.

In the last two years, new carriers have also entered the Brazilian market with international routes, such as Norwegian Air, Sky Airlines, Flybondi and Jetsmart, offering low-cost flights to Europe and other Latin American countries.

In another sign of growing international competition, Britain’s Virgin Atlantic will begin flights from Brazil to London in March. (Reporting by Anthony Boadle; Editing by Andrew Cawthorne)