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U.K. and U.S. Conclude Post-Brexit Open Skies Agreement
The British government this week announced a new bilateral Open Skies aviation agreement with the United States, concluding a protracted process and giving a degree of certainty to U.K. carriers of a continuation of operations between the two countries post-Brexit. The agreement will not replace the current Open Skies agreement between the European Union and the United States, which the U.K. was party to, but will allow for a smooth transition for airlines once a formal British withdrawal from the European Union is complete.
In the official announcement on the U.K. Government website, Transport Secretary Chris Grayling said: “The UK and United States have a special relationship which has helped shape the modern world and there is no better example of this than in aviation. Our transatlantic flights have helped to bring our countries even closer together, strengthening our ties and boosting our economies.”
The aviation relationship between the U.K. and U.S. stems from the negotiation and signing of one of the earliest bilateral air service agreements in 1946, named the Bermuda Agreement. Now, one of the most popular air routes in the world is New York-London, connecting two economic hubs in the two countries.
Concern had been growing about the future of the U.K.’s air service agreements with the U.S. after the planned withdrawal from Europe in March 2019. The agreement goes some way to protecting issues such as ownership of airlines post-Brexit which may have negatively impacted on those airlines operating with a U.K. Air Operators Certificate (AOC). The new agreement will honor current rules regarding ownership but any future changes to airline ownership or new start-ups will have to meet the new regulations or seek U.S approval.
The news of an agreement was met with a positive reaction from industry representatives on both sides of the Atlantic. The International Airlines Group (IAG), which own British Airways, relies significantly on the profitable transatlantic routes. British Airways alone operates service to New York from three of London’s airports, Heathrow, Gatwick and City.
Its CEO, Willie Wash, was quoted in the U.K. government media release saying: “This agreement is a significant positive development which we welcome. The agreement, which closely follows the Model US Open Skies Agreement, facilitates strong competition and is clearly pro-consumer.”
The U.S. airline advocacy group Airlines for America was reported in Reuters saying that the agreement “provides the legal framework for the 20 million passengers and more than 900,000 tons of cargo flown between the two countries annually.”
A U.S. State Department official was also quoted as saying, “the text meets the U.S. objectives of a smooth transition in the transatlantic aviation market post-Brexit and increased market access for U.S. carriers.”
News of the newly-inked Open Skies agreement, the near possibility of a deal with Canada and the announcement by the U.K. government of finalized deals with the governments of Albania, Georgia, Iceland, Israel, Kosovo, Montenegro, Morocco and Switzerland, are a welcome sign for the aviation industry facing continued uncertainty due to Brexit.
The U.K. Parliament is scheduled to vote Dec. 11 on the withdrawal agreement negotiated by Prime Minister Theresa May’s negotiating team and agreed upon by her cabinet and the European Union. Within the withdrawal agreement are plans for a continuation of the Open Skies agreement with the E.U., though a new deal will need to be negotiated during a planned transition period. Current media reports within the U.K. say that approval by the U.K. parliament may be difficult to achieve which could create further uncertainty for the aviation industry.
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