Qantas' hopes of increasing its international position were rejected this week after the Federal Government refused calls to adjust the Qantas Sales Act.

The Act introduced in 1992 keeps the carrier’s foreign investors at a maximum of 49 percent, a cap the carrier said keeps Qantas from competing fairly with other airlines, The Australian reported.

"It is a shame that Australia's national airline has to compete with one arm tied behind its back," a Qantas spokesperson told media.

The Federal Government’s decision comes days after Qantas’ competitor Virgin Australia announced it had restructured its business to secure more foreign ownership.

Transport Minister Anthony Albanese explained that the Government had no plans to change the 49 percent limit and a spokesperson for the Minister added that Virgin’s movements were commercial and required no government approval.

"Over many years, Qantas has demonstrated it can adapt to changing global market conditions while remaining governed by the requirements of the Qantas Sale Act," Mr Albanese explained.

The Minister’s spokesperson added, "As long as Virgin Australia's international airline continues to comply with the provisions of the act, it is free to structure its domestic operations as it sees fit”.

"If an unacceptable ownership of Virgin's international business arose, the government would exercise its power to prevent it."