If aviation history was made during the final week in October in Washington, newspaper readers could be forgiven for scarcely noticing it. The few column inches devoted to the first official US-EU block discussion regarding commercial aviation rights were generally dour on the whole affair, portraying EU director for air transport Claude Chene's plan for a 'free and fair aviation zone across the Atlantic' as a near quixotic notion.
Certainly, it is tempting to come to such a conclusion. The obstacles to such a fully fledged negotiation are enormous. For example, the Commission only has a mandate to discuss with the likes of the US such broad 'soft rights' as codesharing issues, antitrust immunity and dispute resolution clauses.
Though some suggest the October talks were a bid to influence EU member states to support Commission competency for negotiating, there is still scepticism about whether this is likely.
The US, meanwhile, is continuing its two year rampage of establishing open skies arrangements that have as their foundation fully liberalised air rights - the 'hard rights' of the trade.
Though US transportation officials have long discussed the idea of entering into a block negotiation with the EU, DG7 in Brussels can offer little that would trump current efforts at traditional, bilateral talks with individual EU member countries.
Nonetheless, odder things have happened. Only a year ago, few would have thought that the UK would have even considered entering into an open skies dialogue with the US. The US-Germany relationship is equally instructive. The 1994 ratcheting back of rights in a fairly liberal agreement was rescinded the next year with a completely revamped open skies agreement that has contributed so much to the US's open skies negotiating momentum. As things stand now, much will depend upon the outcome of US/UK and US/France talks
'It was encouraging,' says a US negotiator matter of factly about the dialogue with the EU. 'They didn't come in and oversell their mandate, and didn't expect us to negotiate soft rights, which is positive. It was cordial and instructive.' And the negotiator adds: 'It was recognised that this was a precedent. The hardest part is making the first step. We may have 5,372 more steps to take, but at least the hardest one is behind us.'
For Chene, it was imperative that at least the soft rights were discussed in the first of many efforts to find common ground. The talks covered ownership issues, antitrust immunity, dispute resolution clauses, differences in law on the wet-leasing of aircraft, regulation of computer reservation systems, environmental laws, and commercial arrangements between carriers.
Without presumption of reaching conclusions, Chene simply wanted to know the answer to questions like why US carriers are not allowed to wet lease from European companies (that's the FAA's bailiwick, was the response), or why US provisions limiting airline ownership by non-US citizens to 25 per cent could not comport with the EU's 49 per cent rule (a Congressional decision, not administrative).
US sources describe the short term impact of talks as 'minimal', but a Commission source says further talks can be expected in January and a positive outcome will lead to a request to the Council of Ministers for a full mandate to discuss hard rights.
These efforts are bringing the two sides to consider the other's stance. Both agreed to report to each other on several points - a sign, one participant says, that the discussion was as fruitful as it could be at this stage.
The point is not that open skies will be established immediately, but that a dialogue has been initiated. In an arena where bilateral discussions can and often do fall apart over an incorrect phrase or some other minutia, coming to terms on even the small things has a longer-term purpose. 'Who knows,' says a US official, 'maybe in five years we'll look back at this as the beginning of something big.'
Source: Airline Business
