Open Skies
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Open Skies
This is a new thread, intended to collate together all information, views, thoughts etc. relating to the EU/US Open Skies issue and related subjects.
Just for information, the current situation appears to be:
- The EU is currently awaiting further info from the US, in relation to the foreign ownership of US carriers; the Open Skies issue has come down to two key points, this and access to LHR;
- US carriers, particularly Continental, are of the view that theoretical access to LHR is not good enough, if they end up having to pay $30m (or so) per slot.
- Despite the delays (it had been hoped that the US proposals might be available in time to seal a deal at the EU ministers' meeting on 14th October), the EU maintains that it is optimistic that a deal can be done by the end of the year,.
- The EU has refused Ireland permission to proceed with its "mini-bilateral" with the US, on the basis that it would like to wait until all countries have Open Skies together; the US also indicated that it would not like the Irish deal to go ahead until full O/S was in place. However, the Irish agreement provides for a transitional phase, whereby O/S would have come about in 2008 (according to the original schedule), but there would be a reduction in the ratio of DUB:SNN flights to 3:1 for Summer 2007.
- Canada has indicated that it would like to increase the number of O/S agreements in place and is likely to enter into negotiations with the EU.
- One of the biggest obstacles for the EU/US deal was seen to be the mid term elections, to take place next week (7th Nov); hopefully, once these are out of the way, normal service can resume, BUT at this stage, it is expected that the Democrats will have control of at least the House, so this may affect the final deal.
Just for information, the current situation appears to be:
- The EU is currently awaiting further info from the US, in relation to the foreign ownership of US carriers; the Open Skies issue has come down to two key points, this and access to LHR;
- US carriers, particularly Continental, are of the view that theoretical access to LHR is not good enough, if they end up having to pay $30m (or so) per slot.
- Despite the delays (it had been hoped that the US proposals might be available in time to seal a deal at the EU ministers' meeting on 14th October), the EU maintains that it is optimistic that a deal can be done by the end of the year,.
- The EU has refused Ireland permission to proceed with its "mini-bilateral" with the US, on the basis that it would like to wait until all countries have Open Skies together; the US also indicated that it would not like the Irish deal to go ahead until full O/S was in place. However, the Irish agreement provides for a transitional phase, whereby O/S would have come about in 2008 (according to the original schedule), but there would be a reduction in the ratio of DUB:SNN flights to 3:1 for Summer 2007.
- Canada has indicated that it would like to increase the number of O/S agreements in place and is likely to enter into negotiations with the EU.
- One of the biggest obstacles for the EU/US deal was seen to be the mid term elections, to take place next week (7th Nov); hopefully, once these are out of the way, normal service can resume, BUT at this stage, it is expected that the Democrats will have control of at least the House, so this may affect the final deal.
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Well collated akerosid. 
Having had involvement in this discussions some years ago, it's also very important from the US' point of view that their Legacy carriers are fighting fit, so to speak, to be in a position to tackle any significant change to their competitive landscape. Of course, Delta & NW remain in Ch.11... IMO, there will not be a deal reached until they both emerge from bankruptcy protection.
Having had involvement in this discussions some years ago, it's also very important from the US' point of view that their Legacy carriers are fighting fit, so to speak, to be in a position to tackle any significant change to their competitive landscape. Of course, Delta & NW remain in Ch.11... IMO, there will not be a deal reached until they both emerge from bankruptcy protection.
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That could take ages, particularly with NW. I hope both emerge, of course, but I think the real problem could be if the Democrats regain control of either house of congress (I think Representatives is more likely?); they'll be looking at ways of flexing their muscles and this could be one.
As you can appreciate, I look at the whole Open Skies issue from an Irish perspective and up to a while ago, the US was pushing us to move on this and then, just recently (after the announcement of FR's plan to move on EI - which, as you can imagine, must have gone down like a lead balloon with US carriers!) they were rather stand-offish, saying they'd rather wait until everyone had it. Can't help wondering if words were said; FR on t/a routes would upset a lot of people!
As you can appreciate, I look at the whole Open Skies issue from an Irish perspective and up to a while ago, the US was pushing us to move on this and then, just recently (after the announcement of FR's plan to move on EI - which, as you can imagine, must have gone down like a lead balloon with US carriers!) they were rather stand-offish, saying they'd rather wait until everyone had it. Can't help wondering if words were said; FR on t/a routes would upset a lot of people!
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It's the Republicans that have been stalling it all along so hopefully common sense will prevail once the election is over whatever about it prevailing here when our election is over.
The Shannon stopover has survived 10 Taoisaigh and 20 Governments!
The Shannon stopover has survived 10 Taoisaigh and 20 Governments!
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Neither Republicans nor Democrats are interested in seriously opening up the US transportation markets, until the American carriers are in a position to be a acquirer. That's a few years away, assuming no major issues coming up along the way.
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Let's face it, the US concept of "free and open competition" between, say, JFK and LHR is that there should be a struggle for survival between AA, CO, DL, NW and UA. And nobody else. After all, if it isn't American, it has to be second rate.
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Well I wouldn't go to that extreme. Do the Americans want to ensure their companies have equal, if not greater, footing? Yes. But that's probably not any different than any other country. No one can say (with a straight face) that Europe, the major Continental players in particular, doesn't also play these sorts of games.
I'm willing to bet that if the situation were reversed, Europe would be just as disinterested in Open Skies as the Americans.
I'm willing to bet that if the situation were reversed, Europe would be just as disinterested in Open Skies as the Americans.
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The US talks about Open Skies on transatlantic routes. Europe talks about an Open Aviation Area encompassing the EU, The US, and the routes between the two.
That is the gulf between the two positions.
The US talks about market access, and pricing freedom. In other words, any US or EU airline, flying any EU-US citypair, charging what it likes.
The EU talks about this plus – US access to EU domestic, EU access to US domestic. In practical terms, these freedoms are no particularly big deal. Much more important is a process of a harmonisation of the competition rules – the two sides have very different interpretations of what constitutes anticompetitive behaviour, abuse of dominant position etc, also there are different rules on what constitutes State Aids, bankruptcy protection etc. Then there are big issues on divergence of security rules, for example.
Ownership & control is a big sticking point, not (only) because of US protectionism, but because the starting point in the harmonisation process is different on either side of the Atlantic. A US airline has to be 75% US-owned, whereas an EU airline has only to be 51% EU-owned. This means that, in a process which eventually abolished majority-ownership rules, the US would have to move unilaterally to the EU level before the two could contemplate moving in step to something less restrictive.
In the world of aviation bilaterals, where every demand from one side is subject to a quid pro quo on the other, giving ground unilaterally is something big strong countries don’t do easily.
That is the gulf between the two positions.
The US talks about market access, and pricing freedom. In other words, any US or EU airline, flying any EU-US citypair, charging what it likes.
The EU talks about this plus – US access to EU domestic, EU access to US domestic. In practical terms, these freedoms are no particularly big deal. Much more important is a process of a harmonisation of the competition rules – the two sides have very different interpretations of what constitutes anticompetitive behaviour, abuse of dominant position etc, also there are different rules on what constitutes State Aids, bankruptcy protection etc. Then there are big issues on divergence of security rules, for example.
Ownership & control is a big sticking point, not (only) because of US protectionism, but because the starting point in the harmonisation process is different on either side of the Atlantic. A US airline has to be 75% US-owned, whereas an EU airline has only to be 51% EU-owned. This means that, in a process which eventually abolished majority-ownership rules, the US would have to move unilaterally to the EU level before the two could contemplate moving in step to something less restrictive.
In the world of aviation bilaterals, where every demand from one side is subject to a quid pro quo on the other, giving ground unilaterally is something big strong countries don’t do easily.
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Effect of US election results on Open Skies?
Thanks, The SSK, for pointing this out; I had always assumed that the US position was what we were fighting for, i.e. routes between the two, but that the waters had been muddied because of the EU (primarily UK) wish for investment in US carriers. Frankly, I've always had a suspicion that this was brought in by BA/AA to muddy the waters, as the last thing they want is to have any further competition on LHR-US flights. Unfortunately, the EU fell for this. Maybe I'm being unfair; it's just the way I see it.
While most people outside the US (and obviously, quite a few more inside) will be relieved at the US election results, I'm wondering what it will mean for the prospects for Open Skies? The fact that the Democrats are likely to control both houses (as of this writing, with both Montana and Virginia likely to go to the Dems).
Open Skies has been a major initiative of the DOT and since the President is a lame duck, isn't there are risk that this will be one of the policy initiatives which could be stopped? I believe (without being 100% certain) that the Democrats will have control of all committees and that will include the Aviation Committee.
If this happens, what then? There will be lots of lobbying by those against change and a lot of pressure to hold out for what they believe to be a better deal. With regard to the argument above, that the US will wait until its airlines are stronger before going into Open Skies, surely one of the benefits of foreign ownership is that this strength can be added from outside?
Hopefully, we can get some indication in the near future as to what the new Congress will want to do and in particular, its attitude towards O/S.
From a US perspective, how do things look now - more or less optimistic about O/S?
While most people outside the US (and obviously, quite a few more inside) will be relieved at the US election results, I'm wondering what it will mean for the prospects for Open Skies? The fact that the Democrats are likely to control both houses (as of this writing, with both Montana and Virginia likely to go to the Dems).
Open Skies has been a major initiative of the DOT and since the President is a lame duck, isn't there are risk that this will be one of the policy initiatives which could be stopped? I believe (without being 100% certain) that the Democrats will have control of all committees and that will include the Aviation Committee.
If this happens, what then? There will be lots of lobbying by those against change and a lot of pressure to hold out for what they believe to be a better deal. With regard to the argument above, that the US will wait until its airlines are stronger before going into Open Skies, surely one of the benefits of foreign ownership is that this strength can be added from outside?
Hopefully, we can get some indication in the near future as to what the new Congress will want to do and in particular, its attitude towards O/S.
From a US perspective, how do things look now - more or less optimistic about O/S?
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Akerosid, I have always enjoyed your postings. I have no idea who you are but I have a long experience in dealing with airline regulatory affairs. I was involved a few years back in preparing the EU position for the openskies negotiations with the US which have taken around 20 years so far. It is a pathetic record when there are potentially so many consumer benefits. I do not believe that the US will ever allow free global ownership of its airlines and I have absolutely no idea why any non US business would have any interest in owning shares in such a hopelessly bankrupt industry. So what I think is that the ownership issues are just a red herring to prevent any deal happening. There are huge vested interests in preventing it. Heathrow access is just the starter. But French chauvinism is also crucial and then there is the German issues about the Star alliance which includes United , an airline that has failed to make a go of LHR-JFK. That has got to be the most pathetic marketing performance ever in the whole history of aviation.
What is needed to crack it all open are politicians with courage. Do you know any?
What is needed to crack it all open are politicians with courage. Do you know any?
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While most people outside the US (and obviously, quite a few more inside) will be relieved at the US election results, I'm wondering what it will mean for the prospects for Open Skies? The fact that the Democrats are likely to control both houses (as of this writing, with both Montana and Virginia likely to go to the Dems).
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I was hoping not to get that answer, The SSK, but I fear it is true. We may have a long wait and I'm less optimistic than ever that we'll have O/S in place by year end, as the EU Commission seemed to suggest.
Now it's over to Plan B for Ireland ...
Averytdeaconharry, thanks for your kind comment. I've always been interested in regulatory issues, having been involved in lobbying against the Shannon stopover, our excuse for a transatlantic aviation policy, since my college days back in the early 1990s; although I'm now living in Jersey, I continued to be very interested in it (and indeed, regulatory issues generally) and have been following the issue very closely over the past 2-3 years particularly, since the prospect of an EU-negotiated deal became known.
We're in a very difficult position in Ireland because although a "status quo"/"all engines stop" position wouldn't affect most countries that much - since most already have O/S anyway (despite the ECJ decision in 2003). However, we're still stuck with this
SNN stopover rule, which requires one flight from SNN and one from DUB; US carriers and EI and now - belatedly - the Irish govt want it to change, but the Commission won't allow it. I believe there are grounds for a challenge on Competition Grounds, but whatever happens, we're not going to write off another year to this kind of nonsense, especially as one of the consequences of this nonsense is that EI could add three more US cities. It's incredible that we're in this position in 2007.
Now it's over to Plan B for Ireland ...
Averytdeaconharry, thanks for your kind comment. I've always been interested in regulatory issues, having been involved in lobbying against the Shannon stopover, our excuse for a transatlantic aviation policy, since my college days back in the early 1990s; although I'm now living in Jersey, I continued to be very interested in it (and indeed, regulatory issues generally) and have been following the issue very closely over the past 2-3 years particularly, since the prospect of an EU-negotiated deal became known.
We're in a very difficult position in Ireland because although a "status quo"/"all engines stop" position wouldn't affect most countries that much - since most already have O/S anyway (despite the ECJ decision in 2003). However, we're still stuck with this
SNN stopover rule, which requires one flight from SNN and one from DUB; US carriers and EI and now - belatedly - the Irish govt want it to change, but the Commission won't allow it. I believe there are grounds for a challenge on Competition Grounds, but whatever happens, we're not going to write off another year to this kind of nonsense, especially as one of the consequences of this nonsense is that EI could add three more US cities. It's incredible that we're in this position in 2007.
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It gets worse ...
As if the prospects for O/S weren't precarious enough, the EU has decided to throw another problem into the mix; it has now proposed to include airlines in carbon emission trading, something which has gone down like a lead balloon in Washington, with talks about threats of legal action over what Washington sees as a tax.
Add this to the stand-off over foreign ownership of US carriers and you have a fine stand-off and certainly one which looks further from resolution than ever. I don't know what deadline has been set by the Commission for the Americans to reply with their proposed rule on ownership (I thought this was expected sometime next month?), but it's probably academic at this stage, because it's likely that Congress will be able to veto any deal done - even if agreement is reached.
Looking at matters from the EU side and although I studied EU Law many years ago, I am a bit rusty on it; I'm trying to look for examples of case law where the EU Commission was ruled to have acted ultra vires as a result of imposing a competitive disadvantage on a particular country/airline; this appears to be the case for Ireland. The EU Commission is refusing to allow Ireland to move ahead to a more balanced, fairer bilateral agreement with the US. The situation for Ireland is even more frustrating because within the next week or so, the European Court is expected to rule on the Commission's case against the Netherlands, which was the first country to enter into an O/S deal with the US; although the Court is expected to rule in favour of the Commission, the actual effect of this is not likely to be great, because although previous O/S agreements entered into by Germany, France, Italy and other countries were ruled illegal, the EU did nothing to compel them to revert to the old bilaterals, but it still refuses to let Ireland move forward with what would be a far tamer agreement - much less competitive than full Open Skies, even with the changes agreed. The result of this is that, now, thanks to the Commission, the competitive gap between Ireland and virtually every other EU member state (except the UK) is greater than ever! Thanks guys.
What I'm also trying to determine is the extent to which the Commission can go in negotiating agreements with third countries, in undermining the interests of member states; in its negotiations with the US, the Commission may well be pursuing a noble and creditable goal, but I'm not convinced that the negotiating power given to it as a result of the Commission -v- Germany case extended to allowing it to place a member state at a competitive disadvantage; in other words, does a long term potential goal justify the imposition of a short-medium (indeed, indefinite) actual competitive disadvantage. I have serious doubts as to whether the Commission has such powers.
Add this to the stand-off over foreign ownership of US carriers and you have a fine stand-off and certainly one which looks further from resolution than ever. I don't know what deadline has been set by the Commission for the Americans to reply with their proposed rule on ownership (I thought this was expected sometime next month?), but it's probably academic at this stage, because it's likely that Congress will be able to veto any deal done - even if agreement is reached.
Looking at matters from the EU side and although I studied EU Law many years ago, I am a bit rusty on it; I'm trying to look for examples of case law where the EU Commission was ruled to have acted ultra vires as a result of imposing a competitive disadvantage on a particular country/airline; this appears to be the case for Ireland. The EU Commission is refusing to allow Ireland to move ahead to a more balanced, fairer bilateral agreement with the US. The situation for Ireland is even more frustrating because within the next week or so, the European Court is expected to rule on the Commission's case against the Netherlands, which was the first country to enter into an O/S deal with the US; although the Court is expected to rule in favour of the Commission, the actual effect of this is not likely to be great, because although previous O/S agreements entered into by Germany, France, Italy and other countries were ruled illegal, the EU did nothing to compel them to revert to the old bilaterals, but it still refuses to let Ireland move forward with what would be a far tamer agreement - much less competitive than full Open Skies, even with the changes agreed. The result of this is that, now, thanks to the Commission, the competitive gap between Ireland and virtually every other EU member state (except the UK) is greater than ever! Thanks guys.
What I'm also trying to determine is the extent to which the Commission can go in negotiating agreements with third countries, in undermining the interests of member states; in its negotiations with the US, the Commission may well be pursuing a noble and creditable goal, but I'm not convinced that the negotiating power given to it as a result of the Commission -v- Germany case extended to allowing it to place a member state at a competitive disadvantage; in other words, does a long term potential goal justify the imposition of a short-medium (indeed, indefinite) actual competitive disadvantage. I have serious doubts as to whether the Commission has such powers.
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Excuses Excuses
The EU already bent the rules for SNN by agreeing to a transitional arrangement for that airport. Surely this transitional agreement would be allowed come into effect if the Irish Government put them under pressure.
Ireland is only a dot on the map as far as Brussells and Washington is concerned.
Ireland is only a dot on the map as far as Brussells and Washington is concerned.
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The EU has discretion, according to correspondence I've had with the Commission, to grant the power to negotiate with a third party (in this case the US), as long as
- The agreement contains clauses required by the Commission (and since the Nov 05 deal was negotiated under EU supervision, this can be assumed to be the case), and
- The third party negotiations will not undermine EU negotiations under way. The EU has discretion to decide if this is the case and appears, so far, to have decided against us - notwithstanding that the issue obstructing agreement (foreign ownership of US carriers) has nothing to do with Ireland or Aer Lingus.
The govt certainly does need to take a tough line, BUT ... does it want to, with an election coming up? Politically, it may consider it more expedient not to get it. I think - and HOPE - that might be too cynical a view, but I'm damned if I'm going to leave it to chance. The EU needs to be made to feel the pressure on this.
There are some European Law issues which the govt can use if it were to choose to take the EU to court, for example:
- Since the Commission got its mandate to negotiate O/S from the ECJ judgment, can ANY European Court judgment be interpreted in such a way as to permit the imposition or maintenance of a competitive disadvantage?
- Despite winning the case against Germany and other countries in 2003, the EU decided not to take action to force them to regress to their old bilaterals (mainly due to practicality reasons), yet it exercised its discretion to stop Ireland moving forward. Again, practicality was an issue, BUT can practicality on its own be a justification for using discretion unfairly, particularly when the result is the skewing of competitive advantage in favour of certain countries?
- Is it ever acceptable to impose an ACTUAL competitive disadvantage on a member state, in the course/pursuit of a potential agreement with a third party?
- To what extent can a member state act to correct a competitive disadvantage imposed by a member state; in view of the time lag between initiative and receiving judgment in an ECJ case, can the member state act immediately to correct this (and in doing so, is it protected from any sanction or fines from the Commission?)
----------------------------------------------------------------------
Does anyone know what the Americans' current position is? When are we likely to hear what their proposal is in relation to foreign ownership (and indeed, if we do, will they have discussed it with Congress first, or just present it to the EU first and let Congress shoot it down later?)
Also, is there any indication from the DOT on the feelings towards the current negotiations and how long they're likely to be delayed - particularly given the EU's stance on taxing carbon emissions?
- The agreement contains clauses required by the Commission (and since the Nov 05 deal was negotiated under EU supervision, this can be assumed to be the case), and
- The third party negotiations will not undermine EU negotiations under way. The EU has discretion to decide if this is the case and appears, so far, to have decided against us - notwithstanding that the issue obstructing agreement (foreign ownership of US carriers) has nothing to do with Ireland or Aer Lingus.
The govt certainly does need to take a tough line, BUT ... does it want to, with an election coming up? Politically, it may consider it more expedient not to get it. I think - and HOPE - that might be too cynical a view, but I'm damned if I'm going to leave it to chance. The EU needs to be made to feel the pressure on this.
There are some European Law issues which the govt can use if it were to choose to take the EU to court, for example:
- Since the Commission got its mandate to negotiate O/S from the ECJ judgment, can ANY European Court judgment be interpreted in such a way as to permit the imposition or maintenance of a competitive disadvantage?
- Despite winning the case against Germany and other countries in 2003, the EU decided not to take action to force them to regress to their old bilaterals (mainly due to practicality reasons), yet it exercised its discretion to stop Ireland moving forward. Again, practicality was an issue, BUT can practicality on its own be a justification for using discretion unfairly, particularly when the result is the skewing of competitive advantage in favour of certain countries?
- Is it ever acceptable to impose an ACTUAL competitive disadvantage on a member state, in the course/pursuit of a potential agreement with a third party?
- To what extent can a member state act to correct a competitive disadvantage imposed by a member state; in view of the time lag between initiative and receiving judgment in an ECJ case, can the member state act immediately to correct this (and in doing so, is it protected from any sanction or fines from the Commission?)
----------------------------------------------------------------------
Does anyone know what the Americans' current position is? When are we likely to hear what their proposal is in relation to foreign ownership (and indeed, if we do, will they have discussed it with Congress first, or just present it to the EU first and let Congress shoot it down later?)
Also, is there any indication from the DOT on the feelings towards the current negotiations and how long they're likely to be delayed - particularly given the EU's stance on taxing carbon emissions?
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Now we know!
Well, I didn't have to wait long for an answer!
Here it is officially; the US has dropped plans for any changes in foreign ownership for US airlines, which means that Open Skies is pretty much dead for now and is likely to remain so for the duration of this Congress.
The next move is up to the EU Commission. I'd try and predict the logical move, but logic and the Commission have never been happy bedfellows ...
http://www.rte.ie/business/2006/1205/airlines.html
Here it is officially; the US has dropped plans for any changes in foreign ownership for US airlines, which means that Open Skies is pretty much dead for now and is likely to remain so for the duration of this Congress.
The next move is up to the EU Commission. I'd try and predict the logical move, but logic and the Commission have never been happy bedfellows ...
http://www.rte.ie/business/2006/1205/airlines.html
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European transport ministers will meet in Brussels next week, to find out more about the position relating to Open Skies.
It is expected that the Commission will be asked to take a new approach to resolving the problem, although what shape that will take is unclear. There was an expectation some time ago that the EU might ask some member states to cancel their bilaterals with the US, although I can't see much of an appetite for that.
http://news.airwise.com/story/view/1165524387.html
It is expected that the Commission will be asked to take a new approach to resolving the problem, although what shape that will take is unclear. There was an expectation some time ago that the EU might ask some member states to cancel their bilaterals with the US, although I can't see much of an appetite for that.
http://news.airwise.com/story/view/1165524387.html
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Far east.
Reports indicate that Singapore and Thai are seriously looking at Dublin.
In relation to Cork, you had your chance last year and didn't support Slattery's twice weekly charters to JFK.
Cork people want direct services as long as the fare is no more expensive than what's available ex SNN. In those circumstances the yield will be poor and the service uneconomic.
In relation to Cork, you had your chance last year and didn't support Slattery's twice weekly charters to JFK.
Cork people want direct services as long as the fare is no more expensive than what's available ex SNN. In those circumstances the yield will be poor and the service uneconomic.
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It would be great to see either of them; having the likes of SIA, the bluest of blue chip airlines serving DUB would be a huge boost, having the incentive to market Ireland in a wide variety of crucial markets. 
Perhaps they would be willing to serve DUB via somewhere else, as long as the DAA undertook to extend the runway within a reasonable timeframe?
(Can we move the TG/SQ rumours over to the "Dublin thread", as this thread should really be confined to Open Skies?)
Does anyone know exactly what happened with the Singapore deal? Was it just that Singapore jumped the gun, or the fact that beyond rights would be part of any new deal done between Ireland and the US?
Perhaps they would be willing to serve DUB via somewhere else, as long as the DAA undertook to extend the runway within a reasonable timeframe?
(Can we move the TG/SQ rumours over to the "Dublin thread", as this thread should really be confined to Open Skies?)
Does anyone know exactly what happened with the Singapore deal? Was it just that Singapore jumped the gun, or the fact that beyond rights would be part of any new deal done between Ireland and the US?
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The Open Skies agreement with the USA did not succeed as yet. However the progress has been achieved on the Morocco front.
The EU Presidency, Vice-President Jacques Barrot and Karim Ghellab, the Moroccan Minister of Transport, have signed a new type of aviation agreement between the European Union and Morocco. This innovative agreement replaces all the bilateral aviation agreements between the Member States and Morocco.
It is original in that it not only opens up markets but is also designed to approximate the legislation of the two parties. The agreement will stimulate the growth of traffic to Morocco, and new, additional and more varied scheduled services have already been announced.
Jacques Barrot, the European Commission Vice-President with special responsibility for transport, said that "the agreement between Europe and Morocco opens up new development prospects for Moroccan and European companies. We now have an innovative text which is far superior to the conventional open-skies agreements. This agreement will bring the respective countries closer together, and shows us what can be achieved in the context of the Euro-Mediterranean partnership".
The aim of the agreement is to open up the markets gradually and to approximate the legislation of the two parties. It goes beyond the conventional American concept of "open skies", since it comprises a number of fundamental market regulation objectives: flight safety and security will be enhanced, and the competition, state-aid and consumer protection rules will be harmonised. Cross-investment between European and Moroccan companies will be possible, which is not the case under conventional aviation agreements. The agreement also contains several important provisions concerning environmental protection. Lastly, the agreement provides for streamlining administrative procedures.
Passengers will also benefit from new routes, thus avoiding many of the connecting flights now needed. In Morocco, new companies have already been set up, and secondary airports (at present essentially dedicated to regional traffic) will receive international flights. All this will contribute to Morocco`s objective of attracting 10 million tourists by 2010.
The removal of all capacity restrictions between the EU and Morocco is already attracting new market entrants. Carriers have announced new services from Frankfurt, Marseille, the UK and Spain to Marrakesh, Fez and Oujda.
The agreement also breaks new ground in that it is the first time in its history that the European Community, acting as a regional group, has signed a complete aviation agreement with a non-European country. On the European side, the Finnish Presidency and representatives of the 25 Member States have signed the agreement.
The EU-Morocco agreement precedes by a few months another Community agreement that is in the pipeline with the USA. It replaces all the existing aviation agreements between the Member States and Morocco, some of which date back to the 1950s.
The text can serve as reference for any other neighbouring country which might wish to promote economic interdependence with Europe, since the Community wishes to create a common aviation area with all its neighbours by 2010. Contacts have already been established with a view to starting talks with other Mediterranean countries and Ukraine.
It is original in that it not only opens up markets but is also designed to approximate the legislation of the two parties. The agreement will stimulate the growth of traffic to Morocco, and new, additional and more varied scheduled services have already been announced.
Jacques Barrot, the European Commission Vice-President with special responsibility for transport, said that "the agreement between Europe and Morocco opens up new development prospects for Moroccan and European companies. We now have an innovative text which is far superior to the conventional open-skies agreements. This agreement will bring the respective countries closer together, and shows us what can be achieved in the context of the Euro-Mediterranean partnership".
The aim of the agreement is to open up the markets gradually and to approximate the legislation of the two parties. It goes beyond the conventional American concept of "open skies", since it comprises a number of fundamental market regulation objectives: flight safety and security will be enhanced, and the competition, state-aid and consumer protection rules will be harmonised. Cross-investment between European and Moroccan companies will be possible, which is not the case under conventional aviation agreements. The agreement also contains several important provisions concerning environmental protection. Lastly, the agreement provides for streamlining administrative procedures.
Passengers will also benefit from new routes, thus avoiding many of the connecting flights now needed. In Morocco, new companies have already been set up, and secondary airports (at present essentially dedicated to regional traffic) will receive international flights. All this will contribute to Morocco`s objective of attracting 10 million tourists by 2010.
The removal of all capacity restrictions between the EU and Morocco is already attracting new market entrants. Carriers have announced new services from Frankfurt, Marseille, the UK and Spain to Marrakesh, Fez and Oujda.
The agreement also breaks new ground in that it is the first time in its history that the European Community, acting as a regional group, has signed a complete aviation agreement with a non-European country. On the European side, the Finnish Presidency and representatives of the 25 Member States have signed the agreement.
The EU-Morocco agreement precedes by a few months another Community agreement that is in the pipeline with the USA. It replaces all the existing aviation agreements between the Member States and Morocco, some of which date back to the 1950s.
The text can serve as reference for any other neighbouring country which might wish to promote economic interdependence with Europe, since the Community wishes to create a common aviation area with all its neighbours by 2010. Contacts have already been established with a view to starting talks with other Mediterranean countries and Ukraine.