Recently, the Chief Negotiators from the European Commission and the US Dept. of State initialled a Protocol to the EU-US 'Open Skies' trans-Atlantic Air Transport Agreement. This fulfilled their previously stated ambition to negotiate a 'Stage 2' agreement, but that it was achieved is a sign of the strong commitment of both sides.
Among the changes which will apply as soon as the protocol is signed are:
- agreements to streamline the process for new entrants to the market, and reciprocal recognition of determinations of airline fitness and citizenship;
- clearer commitments to international cooperation on noise and other environmental issues and
- a small expansion of EU opportunities with respect to US Government procured transport.
Perhaps the most significant addition from our perspective, though, is a new article specifically to ensure that the agreement does not undermine 'labour related rights and principles'. The Joint Committee, where both ECA and ALPA have a seat, is empowered to 'develop appropriate responses to concerns found to be legitimate'. Additionally, in the associated Memorandum of Consultations there is recognition by the European Commission of 'challenges' related to representation of cross border workers and a promise to inform the Joint Committee about initiatives to 'improve implementation, application and enforcement in this area'. ECA is unaware of any other air transport (or any world trade) bi-lateral agreement with such far reaching social dumping protection.
The most important aspect of the agreement, however, is the attempt by the European Commission to re-balance the market access provisions. Under both the pre-Open Skies National agreements and the Stage 1 EU-US agreement, many in Europe believed that access to North American, European and Trans-Atlantic markets was biased towards American carriers – it is certainly unarguable that US registered carriers have access to many more city pairs than EU airlines. The negotiation was handicapped by the need for the US Congress to alter legislative restrictions on non-US airlines operating on US routes (cabotage) or non-US citizens controlling or owning more than 25% of a US airline. In contrast, US airlines had 5th freedom rights to operate between EU countries and could own up to 49% of an EU airline.
The second stage agreement sets up a pathway to more balanced market access, based on reciprocity. It promises both sides incentives to change legislation: for the US, following an amendment to US legislation which permits 'majority ownership and effective control' of its airlines by EU nationals, then the US will be granted
- the remaining cargo 7th freedoms,
- 5 new passenger 7th freedoms, and
- a 'waiver' by the EU on US citizens owning and controlling a wide number of third country airlines
When the EU changes legislation to permit a review by the European Commission of new noise restrictions imposed by local or national authorities, then the EU will be granted:
- 5 new passenger 7th freedoms and
- a wider waiver by the US on EU Citizens owning and controlling third country airlines
If one of these legislative changes is made, but not the other; the party which has fulfilled their requirements can firstly request consultations and then if dissatisfied, can freeze any new trans-Atlantic services. So 'reciprocity' is the catch word, here.
ECA believes the Commission has committed fully to this process and has sought the best agreement possible. ECA is pleased with the improvements the new agreement envisages, and with the very strong relationship forged between the EU and USA, the world's most important aviation markets. However, we will need to consult closely with our Member Associations across Europe as to how the whole package is supported.