Canada has agreed to schedule talks with the European Union (EU) in February as a prelude to negotiating an open skies agreement.
The EU may be using Canada for leverage in EU-US Open Skies talks, which have stalled over US resistance to changing its foreign ownership and control rules. The USA may pursue a mini-deal that would skirt this roadblock during a new round of talks also scheduled for February, but the EU previously has rejected this approach.
A Canada-EU open skies deal in 2007 seems much more likely. Under its recently adopted Blue Sky aviation policy, the Canadian government hopes to establish more open skies-type accords with other countries. Europe also wants to replace bilaterals that Canada now has with 17 separate European states.
The Canadian Airports Council endorses EU talks, which it claims "would liberalise Canada's air regime with all of the EU's 25 member states in one shot". Open skies would also be a bonanza for Air Canada, which already offers connections for US passengers to Europe through its Toronto hub.
Air Canada is consolidating all its Toronto flights at the end of January into a new terminal wing. This, plus Canadian rules that allow international connecting passengers to bypass entry formalities, could give Air Canada a boost on the North Atlantic.
Although a breakthrough seems impossible on Europe-US Open Skies as EU and US negotiators regroup, the chief US negotiator, deputy assistant secretary of state for transport John Byerly says: "We do have this sense of urgency to get something done during the German presidency of the EU Council (that ends at the end of June) or else it may just force us into a return to openers."
He adds: "We have some concepts that we are exploring with the Europeans even though we don't have any rabbits to pull out of the hat. We may discuss separating the concept of [airline] ownership from the issue of control and we may discuss the possibility of more seventh freedom rights."
IATA director general Giovanni Bisignani says it will be "very difficult to come up with an agreement" and the issue of control is "dead", but he insists that "there is a small opening in ownership". Byerly, speaking during a visit to Brussels, stresses that a legislative change in the US limits on airline investment and control "is just not a possibility. It's dead, even though that fact hasn't fully sunk in over here".
Both Byerly and Bisignani are also sceptical of any mini-deal. "A small agreement will be a lost opportunity," says Bisignani.
Source: Airline Business
