Thursday, January 28, 2016

Air Navigation Commission Recommends Banning Batteries

In a somewhat unexpected development, the Wall Street Journal is reporting that ICAO's air navigation commission will recommend to the ICAO Council that lithium ion batteries be banned from cargo holds of passenger aircraft. The decision is surprising because it runs contrary to the recommendations of ICAO's dangerous goods panel which advised against such a ban late last year.

January 28, 2016 | Permalink | Comments (0)

Wednesday, January 20, 2016

Airlines for Europe Seeks to Eclipse Association for European Airlines

Europe has a new lobbying group, Airlines for Europe (A4E), which hopes to replace the Association for European Airlines (AEA) as the primary trade association for European carriers. AEA was beset by defections last year over the association's opposition to the growth of middle eastern carriers in the European market. The new association includes remaining members of AEA such as Lufthansa and Air France-KLM, along with some of the association's most significant defectors, such as IAG, and major LCCs such as Ryanair and easyJet.  A4E's first campaign is targeting airport charges, an area of agreement for all carriers.

January 20, 2016 | Permalink | Comments (0)

Friday, January 15, 2016

Extending Antitrust Immunity to LATAM

Air Transport World is reporting that LATAM will seek antitrust immunity for joint ventures with American Airlines and IAG. Competition authorities in South America, the European Union, and the United States will all need to acquiesce. The prospects for success will be analyzed in a future post. For now, it is simply worth calling attention to this potentially significant development. This would be the first extension of the immunized, metal-neutral joint ventures to include an airline outside of Europe or North America.

January 15, 2016 | Permalink | Comments (0)

Wednesday, January 13, 2016

Access to Airspace Growing Part of South China Sea Sovereignty Dispute

Vietnam has filed a complaint with ICAO about recent Chinese flights to the Fiery Cross Reef in the hotly contested South China Sea, to which Brunei, China, Vietnam, Malaysia, Taiwan and the Philippines all register territorial claims. Vietnam is responsible for supervision of international flights in the area, and complains that China has recently conducted dozens of flights through the region without properly notifying Vietnamese aviation authorities.

China contends that because these are state flights, they are not subject to the same air traffic requirements as civil aviation. The characterization of the test flights to the Fiery Cross air strip as state flights appears reasonable despite the use of State-owned commercial airliners. The flights did not transport ticketed passengers, and given that the islands in question are primarily uninhabited, commercial services to the area are unlikely. Vietnam's complaints are not limited, however, to the question of state or civil operations, as Vietnam asserts the island area comprises part of Vietnam's sovereign airspace, through which even state flights are prohibited absent prior approval by Article 3 of the Convention on International Civil Aviation (the Chicago Convention). ICAO will have no interest in getting drawn into the larger question of which State has sovereignty over the islands and surrounding areas. Should ICAO take a position, it is likely to be sufficiently narrow to be read as neutrally as possible on the sovereignty question.  

January 13, 2016 | Permalink | Comments (0)

Wednesday, January 6, 2016

Etihad Maximizing Ownership Stake in Jet Airways

Etihad appears poised to increase its ownership stake in India's Jet Airways to 49%, the maximum amount permitted by Indian law. India only recently relaxed its restrictions on foreign investment of airlines and Etihad is taking advantage. The rule changes are, of course, benefiting Jet Airways as well, as the carrier is desperate for the capital Etihad is providing. Despite the newly relaxed rules, Indian government officials retain the authority to scrutinize the transaction and may decide against approval. This latest investment, if approved, will be the last equity infusion of this type that Etihad will be able to provide Jet for the foreseeable future. Not only do India's national laws prohibit Etihad from acquiring a majority ownership in Jet, but Jet's ability to serve international routes under most bilateral air services agreements would be jeopardized should it become majority foreign-owned.

January 6, 2016 | Permalink | Comments (0)

Tuesday, January 5, 2016

Study Shows Unintended Consequences from Tarmac Delay Rule

A recently published study on the effects of the U.S. Department of Transportation's 2010 Tarmac Delay Rule is receiving considerable media attention. The study by researchers at Dartmouth and MIT found that the rule has been successful in its intended goal of reducing the number of delays in which passengers are stranded on the tarmac for an excessive period of time, but that flight cancellations and non-tarmac delays have increased as a consequence of airlines' attempts to comply with the rule. The study's authors propose alterations to minimize the rule's negative effects, such as increasing the tarmac delay threshold from 3 to 3.5 hours and exempting evening flights from the rule to reduce cancellations that strand passengers overnight. 

January 5, 2016 | Permalink | Comments (0)

Wednesday, December 16, 2015

EU General Court Overturns Air Cargo Price Fixing Penalties

The EU General Court today struck down €790 million in fines levied by the European Commission against 11 airlines in a 2010 antitrust decision. The Commission had accused the airlines of colluding on prices for fuel surcharges and security measures, but the court found the Commission's case wanting. It is not yet known whether the Commission will appeal the ruling to the European Court of Justice.

December 16, 2015 | Permalink | Comments (0)

Monday, December 14, 2015

New Registration Process Announced for Small UAS Hobbyists

The FAA issued a press release announcing the new registration process for drone hobbyists, meeting its goal of having a registration system in place before Christmas. The process follows closely the task force recommendations released last month. A few notable additions involve the registration deadlines. Current small drone operators have until February 19, 2016 to register, while drones purchased after December 21 will need to be registered prior to use. The FAA is also hoping to entice early registration by waiving the $5 registration fee for operators who register before January 20, 2016. For now, the online registration system is only intended for recreational users, and for aircraft that fall within the specified size dimensions for small UAS.     

December 14, 2015 | Permalink | Comments (0)

Monday, December 7, 2015

China to Experiment with Competitive Slot Distribution

Reuters reports today that China plans to reform slot allocation at some of its major airports in 2016. Interestingly, China will test out different methods of slot allocation, including sale and random drawing, at different airports, offering a potentially useful natural experiment for scholars and economists. Under the current system, State-owned airlines have been granted the most attractive slot times at the expense of private carriers.  Unfortunately, it appears the reforms will only apply to domestic flights, leaving in place the current system for international services, which is reportedly an obstacle to amending the China/U.S. Air Services Agreement.

December 7, 2015 | Permalink | Comments (0)

Thursday, December 3, 2015

Russia Reorganizes Aviation Administration

The Russian government is reportedly transferring some key aviation responsibilities, including incident investigation and aircraft type certification away from the Interstate Aviation Committee. Neither the reason for the shakeup nor the new assignment of duties are yet publicly known, but the Ministry of Transport and Federal Air Transport Agency (Rosaviatsiya) are both expected to assume increased responsibilities.

December 3, 2015 | Permalink | Comments (0)

Tuesday, December 1, 2015

Thailand Downgraded to Category 2

The U.S. Federal Aviation Administration (FAA) became the latest external agency to publicly express a lack of confidence in the safety of Thai aviation by downgrading Thailand from Category 1 to Category 2 status under the U.S. International Aviation Safety Assessment program. Earlier this year, China, South Korea, and Japan had curtailed Thailand's ability to operate flights to their markets, and the International Civil Aviation Organization pronounced Thailand non-compliant with international safety standards. Because Thai airlines are not currently operating to the United States, the latest downgrade lacks any direct commercial consequences, aside from reputational damage. Thailand clearly has work to do to regain the confidence of the international community.

December 1, 2015 | Permalink | Comments (0)

Monday, November 23, 2015

FAA Drone Registry Task Force Recommendations

The U.S. Federal Aviation Administration's (FAA) Unmanned Aircraft Systems Registration Task Force Aviation Rulemaking Committee released its final report earlier today. The recommendations contained within the report are non-binding, but the FAA is not expected to significantly deviate from the plan outlined in the report. There is very limited time remaining if the FAA is to meet its objective of having a working registration process in place prior to the Christmas holiday, but the Task Force's recommendations may be manageable. The key recommendations were to require owners of small Unmanned Aircraft Systems (under 55 pounds) to register their drones with the federal government online prior to operation, as opposed to at the point-of-sale. The Task Force recommends that registration be free of charge, and open to any person, citizen or not, as long as he or she is at least 13 years of age. Owners would only be required to provide their name and street address when registering. After registration is complete, each drone will be assigned a registration number which the owner will be required to affix to the drone. There is little to object to in the report, as the registration process described should hardly inconvenience drone operators. This hasn't prevented some drone enthusiasts from objecting on principle to the notion that the FAA has the statutory authority to mandate registration of non-commercial drones, which remains a live question, though one that the FAA likely  won't have to litigate until 2016. On the pro-regulatory side, there is concern that not requiring registration at the point-of-sale will lead to widespread non-compliance with the registration requirement. The Task Force recommended the imposition of monetary penalties for non-compliance but did not include specific amounts.

November 23, 2015 | Permalink | Comments (0)

Wednesday, November 18, 2015

Russia Confirms Bomb Caused Jet Explosion

The Russian government has now acknowledged that the recent explosion of a charter jet departing from Egypt's Sharm el Sheikh airport was almost certainly caused by an act of terrorism. The Egyptian government had disputed the bomb theory in recent weeks, but without Russian support Egypt appears likely to eventually concede on this point as well. Should individuals be located and apprehended in connection with the bombing, prosecution of their actions would be covered by the 1971 Convention for the Suppression of Unlawful Acts Against the Safety of Civil Aviation and its 1988 Supplemental Protocol.

November 18, 2015 | Permalink | Comments (0)

Monday, November 16, 2015

Fallout from Kolavia Flight 9268

As we await the results of the investigation into the midair explosion of a Russian airliner two weeks ago, tension has arisen between authorities in Egypt and countries such as the United States, which are used to playing a more active supporting role in investigating such incidents. In addition, the suspected connections to terrorism, combined with the tragic events in Paris last week, have prompted a renewed focus on airport security.  

November 16, 2015 | Permalink | Comments (0)

Thursday, November 12, 2015

DOJ Opposes United Acquisition of Newark Slots

The United States Department of Justice has filed a complaint in federal court in an attempt to prevent United Airlines from acquiring 24 takeoff and landing slots at Newark Airport in an exchange with Delta Air Lines for slots at JFK Airport. United has a dominant position at Newark, owning more than 70 percent of the slots. United believes the relevant market for antitrust analysis should not be confined to city-pairs between Newark and other cities, but should encompass the entire New York city region in which there exist alternatives to Newark Airport and a greater degree of competition. The DOJ forced United to divest slots at Newark as a condition of its merger with Continental and has opposed subsequent attempts by United to reacquire Newark slots, so it can be assumed that the DOJ has already considered and rejected this argument. If the slot swap is to go forward, United may need to convince a court that the DOJ is mistaken.

November 12, 2015 | Permalink | Comments (0)

Wednesday, November 11, 2015

Fight Over Unfair Competition to Shift to Europe

Reuters is reporting that the European Commission is drafting a legislative proposal for release early next year that would allow it to take a tougher line against competitive practices by non-EU carriers the Commission deems to be unfair. The report indicates that the new proposal could extend the Commission's authority to a broader range of practices, grant the Commission new investigative powers, and add new sanctions for violators up to and including revocation of traffic rights. The proposal is clearly intended with the Gulf carriers in mind, as the article mentions that the Commission hopes to discuss the issue of government subsidies with the UAE and Qatar in air services agreement negotiations next month. While subsidy accusations by the legacy U.S. carriers against the Gulf states, including a Wall Street Journal Op-Ed yesterday, have been the dominant story of 2015, this report indicates that Europe is poised to significantly escalate matters this winter.

November 11, 2015 | Permalink | Comments (0)

Friday, October 30, 2015

ICAO Panel Votes Against Battery Ban

A proposal to ban shipment of lithium-ion batteries on passenger flights was brought before the ICAO dangerous goods panel earlier this week, but the panel reportedly voted against making a recommendation to ICAO's Air Navigation Bureau that the ban be adopted. Shipment of lithium-ion batteries have become an increasingly contentious issue in recent years as they have been found to present a fire risk if improperly stored, while demand has exploded as a result of their use in consumer electronic devices. The panel did recommend certain procedural safeguards be implemented with regard to battery shipment. The Bureau is expected to follow the panel's recommendation.

October 30, 2015 | Permalink | Comments (0)

Wednesday, October 28, 2015

6th Circuit Allows District Courts to Hear Challenges to No Fly List Placements

A Sixth Circuit opinion handed down Monday should provide more options to persons seeking to challenge their placement on the No Fly List. Currently, the Department of Homeland Security provides an administrative process through which redress can be sought. Appeals of these DHS decisions are statutorily confined to U.S. appellate courts. According to the Sixth Circuit's ruling in Mokdad v. Lynch, challenges of a citizen's placement on the No Fly List by the Terrorist Screening Center, as opposed to appeals of the results of the administrative application for redress, are not covered by the aforementioned statutory restrictions and can therefore by heard by U.S. district courts, opening up a new venue for challenges. A more complete explanation of the legal issues involved can be found here.

October 28, 2015 | Permalink | Comments (0)

Monday, October 26, 2015

Etihad Buys Time in Dispute Over Air Berlin Codeshares

The German transport ministry relented late last week on its refusal to approve codesharing between Air Berlin and Etihad on a number of flights, but only on a temporary basis. The ministry warned that it did not intend to approve operation of the codeshares beyond January 15. Etihad and Air Berlin had previously operated the codeshares in question, but the transport ministry announced last year that it had determined the codeshares were not authorized by the Air Services Agreement between Germany and the United Arab Emirates. Under the ASA, neither Etihad nor Emirates have the rights to serve Berlin, so Etihad has instead been sharing its code on Air Berlin flights between Berlin and Abu Dhabi. The transport ministry's recent decision appears to have been prompted by an injunction handed down by a German administrative court, presumably on the basis that Air Berlin would have been materially harmed if the codeshare question had gone unresolved beyond the October 25 deadline for approval of the winter flight schedule, and that Etihad's investment in a 29.2% stake in Air Berlin was predicated on the assumption that the codeshares would be permitted to continue. The dispute over codeshares is undoubtedly being influenced by the increasing tension between European carriers and the Gulf Carriers over issues of fair competition and Gulf carrier expansion into the EU market.

October 26, 2015 | Permalink | Comments (0)

Wednesday, October 21, 2015

FAA Grants Nicaragua Category 1 Rating

The FAA announced last week that, for the first time since the creation of the International Aviation Safety Assessment program, Nicaragua has qualified for Category 1 status. The upgrade doesn't portend any immediate commercial ramifications as Nicaragua lacks an international carrier that could take advantage of the expanded operating privileges to the United States market that accompany a Category 1 rating, but it is nonetheless a welcome recognition for the country's aviation sector.

October 21, 2015 | Permalink | Comments (0)