Wednesday, March 18, 2015
The public debate over accusations of subsidies to the so-called "Gulf carriers," Etihad, Emirates, and Qatar has intensified in recent days as calls for action have expanded from rival airlines to include important government officials. Last Friday, transport ministers from France and Germany, with the backing of their counterparts from Austria, Belgium, the Netherlands, and Sweden, publicly expressed their desire for changes to EU law and policy that could restrict Gulf carriers' access to the European market and/or impose conditions on that access such as transparency requirements. Yesterday, William Shuster, Chairman of the U.S. House of Representatives Committee on Transportation and Infrastructure, endorsed the position of the U.S. carriers. Executives from the U.S. and Gulf carriers debated the issue at a forum organized by the U.S. Chamber of Commerce, at which the Gulf carriers promised a full rebuttal of the recently released white paper in which the U.S. carriers detail their claims.
Monday, March 16, 2015
Ryanair has announced that preliminary plans to begin serving routes between the U.S. and the EU have been approved by the airline's board. It will be four-to-five years before these plans are realized as the Irish low-cost carrier needs to first obtain aircraft suitable for long-haul operations. The prospect of future transatlantic services from Ryanair suggests that the ongoing resistance to Norwegian Air International's application to serve the U.S. may merely be delaying the inevitable.
Wednesday, March 11, 2015
Tuesday, March 10, 2015
Norwegian Air Shuttle and striking pilot unions have reportedly reached an agreement to end an 11-day strike. In addition to disrupting the airline's operations, the labor dispute had added international relevance given the centrality of concerns about labor practices to the U.S. government's delay in approving Norwegian's application to operate routes to the U.S. via it's Irish subsidiary, Norwegian Air International. While the strike has no legal bearing on Norwegian's contention that the U.S. is obligated to approve its application under the US-EU Open Skies Agreement, it's probably helpful politically for Norwegian to demonstrate an ability to work amicably with its unions.
Thursday, February 26, 2015
A UK court today held that airlines could not delay payments for compensation claims under EU 261 while awaiting the outcome of a related case before the European Court of Justice. In this case, Jet2 had been postponing payment to a passenger whose flight was delayed by almost seven hours because the delay was caused by a technical difficulty which the airline claimed constituted an "extraordinary circumstance" which exempts the airline from its obligation to compensate passengers. An analogous case concerning how to apply the "extraordinary circumstances" exemption to technical difficulties is currently pending before the ECJ.
Wednesday, February 25, 2015
Details are still emerging, but reports tonight of three Al Jazeera journalists in Paris for the operation of a remotely piloted aircraft illustrate the difficulty ahead in formulating appropriate public policy to meet the challenges presented by new technology.
Thursday, February 19, 2015
Tuesday, February 17, 2015
Wednesday, February 11, 2015
The ICAO Council will reportedly vote in June on whether to make the adoption of a family-assistance plans a recommended practice for States. The recommendation would urge States to develop a set of procedures to be followed in the event of a crash that would hopefully ease the burden on grieving families. With time, the measure could potentially be elevated to a required standard.
Friday, February 6, 2015
First reported by the Wall Street Journal, today's big story is the revelation that the three major U.S. legacy carriers are actively seeking changes to U.S. air transport agreements with the United Arab Emirates and Qatar. The U.S. airlines share similar concerns to those that have been expressed by European and Canadian carriers in recent years, namely that the so-called "Gulf carriers" - Emirates, Etihad, and Qatar Airways - are benefiting from state subsidies that provide those carriers with an unfair competitive advantage.
It is not clear that the air transport agreements need to be amended to address these problems. For example, the air transport agreement between the U.S. and the United Arab Emirates includes the following language under Article 12(1)(c) "Intervention by the Parties shall be limited to...protection of airlines from prices that are artificially low due to direct or indirect governmental subsidy or support." However, provisions such as this are rarely invoked because of the difficultly in defining what constitutes an indirect governmental subsidy, and in monitoring states for violations.
Wednesday, February 4, 2015
The International Civil Aviation Organization (ICAO) is holding a High Level Safety Conference this week, and policy responses to last year's two high profile tragedies involving Malaysian Airlines Flights MH370 and MH17 have dominated the agenda. Reports coming out of the conference have suggested that the organization is responding with uncharacteristic haste to the issues raised by the two incidents.
Prompted by the disappearance of Flight MH370, ICAO appears to have secured sufficient backing to submit performance-based flight-tracking standards for approval at the 2016 ICAO Council session. The standards call for airlines to receive location signals from their aircraft every 15 minutes, and more frequently during periods of distress. It appears the standards will not include prescriptive requirements such as mandating the inclusion of deployable recorder technology in new aircraft.
ICAO also appears to have settled on a proposal intended to improve access to information about flight risks over conflict zones, in hopes of avoiding another accident similar to Flight MH17. Under this plan, ICAO hopes to host an online database that would contain information about risks over conflict zones and be accessible to airlines, air navigation service providers and states.
Tuesday, February 3, 2015
Nearly 11 months after its disappearance, Malaysian authorities have officially designated the incident an accident. The circumstances surrounding the search for the missing aircraft have long represented an awkward overlap between the Search and Rescue functions outlined in Annex 12 to the Chicago Convention and the Aircraft Accident and Incident Investigation responsibilities contained in Annex 13.
Wednesday, January 28, 2015
Irish flag carrier Aer Lingus has been the subject of repeated takeover attempts by both Ryanair and I.A.G., but I.A.G.'s most recent proposal is one step closer to success as the Aer Lingus board has recommended that the airline's shareholders accept the offer. There has been some speculation that this could be the first in a series of acquisitions for I.A.G., but first the offer will need to be accepted by Aer Lingus' two largest shareholders, Ryanair and the Irish government, and the deal will have to be approved by the EU's competition authority.
Tuesday, January 27, 2015
Following the revelation that a remotely piloted quadcopter landed on the White House lawn, the question everyone is asking today is what the ramifications will be for unmanned vehicle usage in the United States. It's possible that such a high-profile incident will hasten integration as the FAA and Congress recognize the urgent need for clear, meaningful guidelines as well as legislative action to address those security and privacy concerns that are beyond the FAA's scope of authority. Conversely, a scare such as this could have freeze progress on integration as concerns about security predominate and blanket prohibitions are implemented until all security questions have been answered.
Thursday, January 22, 2015
News broke this afternoon that Ralph Pirker, the drone operator whose initial challenge to the FAA's authority to regulate unmanned aircraft was successful before being overturned in November, has settled with the agency. Pirker reportedly has agreed to pay a fine of $1,100.
Thursday, January 15, 2015
The Court of Justice for the European Union (CJEU) has issued a judgment in Case C-573/13. The case was referred to the court for the purpose of resolving two questions concerning the proper interpretation of Article 23(1) of Regulation EC No 1008/2008 as that article applies to the computerized booking system used by Air Berlin. The court concluded that a computerized booking system needs to display the final price to be paid at any time prices are listed, and to display the final price for all flights performing a particular service, and not merely the specific flight selected by the customer.
Wednesday, January 14, 2015
In a post last week we took a skeptical view of Indonesia's plans to introduce a price floor for air fares. An analysis out today from CAPA shares our criticism and includes alternative suggestions for how to fix Indonesia's air transport sector, beginning with upgrades to infrastructure and improving the safety oversight apparatus which carries a Category 2 rating from the United States Federal Aviation Administration. Promisingly, there have been reports that the Indonesian government is aware of the need for reforms to the State's transport bureaucracy.
Tuesday, January 13, 2015
Japan is reportedly on the verge of completing bilateral air services agreements with both Cambodia and Laos. The agreements will presumably be similar to those between Japan and the other eight Association of Southeast Asian Nations (ASEAN) Member States. Once these agreements are in place, Japanese airlines will be able to serve all ten ASEAN members directly.
Friday, January 9, 2015
Cyprus Airways has suspended operations effective today in response to an earlier announcement by the European Commission that the restructuring package provided the carrier by the Cypriot government was in violation of EU state aid rules and would have to be repaid. Cyprus was deemed to be in violation of numerous conditions of EU rules, including the "one time, last time" principle which restricts companies to one restructuring package per ten-year period. Cyprus Airways was the recipient of government aid in 2007, 2012, and 2013. Additionally, the Commission concluded the restructuring proposal would not render the airline commercially viable absent future state aid.
Wednesday, January 7, 2015
According to a report, Indonesia's Transport Ministry is considering prohibiting carriers from offering cut-rate fares as a policy response to the AirAsia Flight QZ 8501 crash. The purported reasoning is to ensure carriers have sufficient revenue to fund safe operations. If true, this would be a needlessly inefficient mechanism by which to raise the safety standards of Indonesian carriers. The more straight-forward method, of course, would be to directly increase the safety standards required by the Indonesian government and to penalize carriers that fail to meet those standards. This would likely lead to an increase in fare prices, but only as a byproduct of efforts to increase safety, which is the primary objective. By contrast there is no guarantee that the elimination of ultra-low fares will lead to increased spending on safety measures, as opposed to either greater carrier profits or fewer passengers being served. The only reason I can think of for addressing the issue in this way is that monitoring compliance with restrictions on ticket prices is likely easier and less expensive than inspecting and assessing compliance with operational standards. But ease of monitoring cannot justify a decision to monitor behavior that is only tangentially related to the problem in question. It reminds one of the parable about the man looking for his keys under the lamp post instead of where he lost them because it's easier to see in the light.