News Release
Loyola de Palacio
No. 43/03
June 26, 2003
EU/US AGREEMENT TO OPEN AVIATION TALKS
The European Union and the United States of America have agreed to open negotiations
on an overall agreement on
air transport liberalization.
According to a
statement issued following the June 25
EU-US summit in Washington, DC, the leaders of the United States of America
and the European Union “are pleased to announce their agreement to begin comprehensive
air service negotiations in early Autumn, following the early June decision of
the EU Council to approve a negotiating mandate for the Commission. This is an
historic opportunity to build upon the framework of existing agreements with the
goal of maximizing benefits for consumers, airlines and communities on both sides
of the Atlantic.
The United States and the European Union
will work together in a spirit of co-operation to develop a mutually beneficial
approach to this crucial economic sector in a globalized economy."
European Commission Vice-President
Loyola de Palacio, who is responsible for
transportation, added: “An
aviation agreement between the EU and US would set the model for the rest of the
world these negotiations provide an opportunity to achieve fundamental reform
of this sector that we should not waste.”
Background:
On
5th June, the EU
Transport Council gave the Commission its long-awaited mandate to negotiate
a comprehensive air services agreement with the United States. This will allow
the Commission to negotiate with the US in order: (i) to redress the legal problems
in existing bilateral agreements between the US and member states identified by
the European Court of
Justice in its rulings
in November 2002; and (ii) to establish an open aviation market comprising
the American and European markets, including the removal of restrictions on foreign
investment in each other's airlines.
What does the mandate cover?
For
the first time, representatives of the two largest aviation markets in the world,
the US
and the EU, will be able to discuss opening up their markets and investment rules
directly. The mandate granted to the European Commission covers a wide range of
issues: the negotiations will include all the arrangements governing air transport
between and within the EU and US. This will include the rules governing market
access (routes, capacity, frequency) for cargo and passengers, how air fares are
set, how to ensure effective application of competition rules and how to ensure
maintenance of high standards of airline safety and aviation security. Substantive
negotiations will start at the end of September in the United States with a comprehensive
agenda.
In
the eyes of the European Commission, an
Open Aviation Area (OAA) would essentially create a free trade area for air
transport between the EU and US. This would produce a more competitive market
than today, generating greater choice of services and lower fares for air travelers.
It would give EU and US airlines complete freedom to serve any pair of airports
in the EU and US. EU airlines are currently only able to operate between their
own member state and the US destinations. Relaxing restrictions on ownership and
control would also make it easier for EU and US airlines to enter into mergers
and takeovers with each other.
A
report by US consultants, The Brattle Group, has estimated that an EU/US Open
Aviation Area would generate upwards of 17 million extra passengers a year, consumer
benefits of at least $5 billion a year, and would boost employment on both sides
of the Atlantic.
Commissioner de Palacio said:
“We
welcome and are encouraged by the US
Administration's proposals to bring foreign investment restrictions in line with
those in the EU, and hope that they are successful. This would provide a good
basis for the EU and US then to move further on foreign investment in the context
of an Open Aviation Area (OAA), with the aim of putting aviation on the same footing
as other industries.”
“However, there is an immediate priority in light of the decisions of the European
Court of Justice, the existing agreements need to be brought into conformity with
Community law. We hope that we will be able to achieve this quickly so that we
can then move on to the broader market opening agenda,”
she added.
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Press Contacts:
|
Wilfried Schneider
202-862-9523
|
Maeve O'Beirne
202-862-9549
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