US cargo carriers set to lose fifth freedom rights
European negotiators are expected to withdraw US cargo carriers' fifth freedom rights this week to force a compromise deal over market access in ongoing open skies talks.
European Union transport ministers are meeting on 10-11 June to pass a final draft of the deal thrashed out by the European Commission and US Department of Transportation in recent weeks.
The EC is keen to secure unanimous agreement before officially signing the deal at the EU-US summit in Dublin on 25-26 June. It hopes the revocation of onward flight rights currently granted to US cargo airlines and express carriers will convince doubters of its determination to pin Washington down. The UK is still opposed to any deal that would open access to London Heathrow airport without significant improvements in market access rights to the USA, but the EC could theoretically pass the final text without agreement from all member states, says a source close to the UK negotiating team.
Last month the US Department of Transportation (DoT) issued a compromise on market access, with the creation of "indirect air carrier" status, under which EU airlines could market and sell tickets on US domestic services. This falls short of the full cabotage rights the EC wanted, but is seen by the US side as coming close to the idea of a "franchise carrier", as defined by the Europeans at the end of April.
Jeffrey Shane, under-secretary for policy at the DoT, says any liberalisation of air transport rights between the EU and USA has to be phased in to get legislation passed on both sides of the Atlantic.
The EC has also gained a crucial concession that any treaty will include a clause obligating further talks within 12 months, or risk abrogating the agreement.
Shane says cabotage rights granted to certain US cargo operators within the EU are largely irrelevant because few are exercised. UPS says most of its flights in Europe are performed by partners.
The indirect air carrier rule could permit US carriers to dedicate separate aircraft to their European alliance partners, enabling them to build a market presence in the USA, says Shane.
JUSTIN WASTNAGE / WASHINGTON DC
Source: Flight International
