Atlas of the Sky from the European Commission

The most comprehensive data sources for the global airline and airport industries usually come at considerable cost but there are some good free sources of information available.

One such source is the online Atlas of the Sky provided by the European Commission.

ECJ Advocate General releases opinion on extension of EU ETS to cover international aviation

On 6 October 2011 the Court of Justice of the European Union (ECJ) issued a press release and non-binding legal opinion on the case (C-366/10) brought by the Air Transport Association of America and Others (see previous post).

Reaction from interested parties the same day included statements from:

• Air Transport Association (ATA)
• International Air Transport Association (IATA)
• Association of European Airlines (AEA)

Media coverage of the opinion and related reaction included:

• Financial Post reporting the Canadian Government position
• The Washington Post 
• The Economist 
• Air Cargo World 

While airline opposition might be expected, of much greater significance is the reaction of foreign governments.

As might be expected, the opinion has been of considerable interest to international law academics. Aviation Law Prof Blog from DePaul University in Chicago has been providing commentary and links to other work:

• Advocate General claims EU not bound by Chicago Convention
• Functional succession theory and ramifications of EU exemption from Chicago Convention
• Advocate General opinion charts new ground on extraterritorial jurisdiction over environmental issues
• Advocate General opinion finds no legal impediment to unilateral emissions action
• Does ETS constitute a tax? 

US Congress to ban US airlines participating in EU ETS?

On 20 July 2011 the US House of Representatives Transportation and Infrastructure Committee announced that it is intended to ban US airlines participating in the "illegal" coverage of international aviation by the European Union's Emissions Trading Scheme by means of a short, 5-section Bill.

GreenAir Online covers the development in a 21 July 2011 article, and includes reaction from MEPs.

Many such bills will not make it into law but the fact that this one has bipartisan support suggests that it should not be taken lightly. With key interests in both the United States and China (see previous post) both firmly opposed to the unilateral action being taken by the European Union, as Flightglobal journalist Will Horton has noted, this could get ugly.

US airlines case against EU ETS coverage heard by European Court of Justice

On 5 July 2011 the European Court of Justice (ECJ) heard a case (C-366/10) brought by the US Air Transport Association (ATA), American Airlines and United Continental Holdings against their inclusion the European Union Emissions Trading Scheme (EU ETS)(see previous post).

The ATA has published it oral argument and written observations here.

The Aviation Environment Federation issued a statement noting some of the arguments put in favour of the legality of extending coverage.

The hearing was covered 6 July 2011 articles in Air Transport World and Aviation Week.

An opinion on the case will be delivered by the Advocate General on 6 October 2011 with a final judgement to follow later.

Alleged air cargo rate fixing case reaches court in New Zealand

The NZ Herald reported on court action taken by the Commerce Commission into alleged price fixing by nine international airlines serving the New Zealand market (see previous post) on:

9 May 2011 - "Airlines' price fix case starts in court"
11 May 2011 - "Air cargo cartel case opens in High Court"
12 May 2011 - "Qantas fined $6.5m for price fixing"
12 May 2011 - "Air NZ in court as price-fixing case gets under way"
13 May 2011 - "Qantas hit with record $6.5 million fine"
14 May 2011 - "Cartel case out of line, say airlines"

The Commerce Commission has made a number of media releases on the case:

20 March 2009 - "Commerce Commission procedure in accordance with standard best practice"
11 March 2011 - "Court of Appeal rules on use of confidentiality orders"
18 March 2011 - "Settlements in cartel case as Commerce Commission prepares for Court"
5 April 2011 - "$7.6 million imposed against two airlines in air cargo cartel case" - British Airways and Cargolux
20 April 2011 - "Commerce Commission narrows focus of air cargo cartel case before trial"
27 April 2011 - "Airlines' information request case resolved" - Singapore Airlines Cargo and Cathay Pacific
12 May 2011 - "Court awards highest penalty to date in price fixing" - this statement notes similar action taken in Australia, the United States, the European Union, Canada and South Korea

Air New Zealand has also issued related media statements:

18 March 2011 - in response to a Qantas media statement issued on the same day
20 April 2011

On 17 May 2010 the Australian Competition & Consumer Commission (ACCC) announced that it was taking action against Air New Zealand. On 18 May 2010 Air Transport World reported Air New Zealand's reaction.

On 11 November 2010 the NZ Herald reported that Air New Zealand had been dropped from similar action taken by the European Commission (see previous post).

Chinese concern about EU ETS covering international aviation

On 22 March 2011 Air Transport World reported opposition from the major Chinese airlines to the inclusion of international aviation in the European Union's emissions trading scheme (US airlines have similar concerns - see previous post). It will be very interesting to see what position China's Government adopts.

Wikileaks releases diplomatic cables on UK position during EU-US air negotiations

The Telegraph has published a confidential diplomatic cable from the US Embassy in London dated 4 February 2010 concerning the UK position with respect to the second set of air services negotiations between the European Commission and the United States (see previous post). An earlier related unclassified cable dated 11 March 2009 was also released. Both cables were obtained via Wikileaks.

Issues to feature include the restrictive US position on foreign ownership of airlines and anti-trust immunity for oneworld alliance members (this was subsequently granted - see previous post).

The Guardian carried a report dated 14 February 2011 on the two leaked cables.

While there can be little doubt that for the academic community Wikileaks is providing a valuable source of current history and for the news media plenty to write about, much of what is released shows US diplomats very professionally going about their work. Some of the disclosures have already been damaging, and not just to US interests. It also no doubt leaves many people who deal with US diplomats (including me) wondering how free and frank one can be in conversation. This can only be to the detriment of better international understanding. When it comes to foreign relations I for one think that there are communications that should legitimately not be dropped into the public arena.

European Commission publishes its vision for Europe's transport future

On 28 March 2011 the European Commission published a white paper Roadmap to a Single European Transport Area - Towards a competitive and resource efficient transport system.

Russia's overflight fees and the EU

On 29 October 2010 Air Transport World reported that the European Commission (EC) had announced that it was initiating court action against European Union (EU) member states France, Germany, Austria and Finland over their air services arrangements with Russia that see their airlines paying overflight fees.

Note that these fees are not for air traffic control services. A 28 October 2010 report in the Journal of Commerce provides an estimate of the total fees paid by EU airlines, mostly to Aeroflot.

On 28 January 2011 Bloomberg reported that the EC was looking to take action against seven additional member states.

On 14 March 2011 the European Commission released a press release that gives background and another press release advising that it was taking action against six further member states.

EU concludes comprehensive air transport agreement with Brazil

On 18 March 2011 the European Commission announced that the European Union and Brazil have negotiated a comprehensive air transport services agreement.

New Zealand's recent air services negotiations

The New Zealand Ministry of Transport's Annual Report for the year ended 30 June 2010 has just been tabled in Parliament and published. It includes a brief section on air services arrangements:

Air services: The Ministry continued working through the issues outstanding in air services negotiations with the European Union. However, given the differences between our respective positions on significant issues, it was difficult to reach a mutually acceptable position. Further negotiations were put on hold pending further developments on either side. 

Negotiations were also held with Papua New Guinea in March 2010 where an understanding was reached on liberalising some elements of the air services arrangements.

New Zealand–Japan air services agreement: An agreement was reached with Japan on amendments to the New Zealand–Japan air services agreement to permit the operation of Boeing B777-300 aircraft on the route.

European Commission to propose a direct tax on aviation?

On 9 August 2010 the Telegraph reported that the European Budget Commissioner has floated the idea that the European Commission be granted the power to impose a direct taxes on financial transactions and air travel. The latter would seem to be in addition to the EU ETS. The United Kingdom Government is reported to be opposed to the idea.

BA/AA Okay

On 20 July 2010 the United States Department of Transportation announced that it had granted anti-trust immunity to an 'integrated' alliance between American Airlines (AA) and four of its oneworld partners, British Airways (BA), Iberia, Finnair and Royal Jordanian. The docket number is DOT-OST-2008-0252. The airlines only had to surrender four pairs of slots at London Heathrow (LHR) airport.

In a 15 July 2010 post Aviation Law Prof Blog covers the European Commission approval of the alliance given on 14 July. The BBC also carried a report. The Commission required the surrender of 49 weekly slots at LHR.

This brings to an end a lengthy process that started over a decade ago. The first attempt by AA and BA to gain approval dates back to 1997 while a second attempt was also knocked back.

The alliance had long been opposed by Virgin Atlantic. I recall seeing their aircraft painted with the slogan No way BA/AA.

WTO report on US complaint against Airbus

On 30 June 2010 the Geneva-based World Trade Organization (WTO) released its massive report on the United States complaint about subsidies given to Toulouse-based aircraft manufacturer Airbus.

Media statements in response have been released by:

• Airbus
• Boeing
• European Commission Trade
• Office of the United States Trade Representative

Regardless of the final outcome it seems highly desirable that there continue to be at least two global-scale manufacturers of large airliners driving innovation through competition.

Germany planning to introduce new duty on aviation

On 7 June 2010 Bloomberg reported on the German Government announcement that it would be introducing a tax on air travel to raise one billion euros a year as part of its efforts to reduce its budget deficit. For those that speak German, some further information is available here about what is described as a national ecological air traffic charge on all passengers.

Reaction from the airline industry included:

• Association of European Airlines
• International Air Transport Association

On 17 June 2010 the Brussels-based NGO Transport & Environment posted a story that suggests that it is not yet clear what will happen to this tax when international air transport is covered by the EU Emissions Trading Scheme (ETS).

US airlines to challenge legality of EU ETS covering international aviation

On 28 May 2010 GreenAir Online reported that US airlines have secured UK High Court agreement to take their case against the extension of coverage of the European Union's emission trading system (EU ETS) to the European Court of Justice.

A news releases was made by the US Air Transport Association.

In a 17 March 2010 post Aviation Law Prof Blog commented on the issues involved.

More information about the plans to extend the EU ETS to cover aviation is available here on the UK Environment Agency web site.

European Commission seeking to negotiate air services agreement with Brazil

On 6 May 2010 the European Commission announced that it is seeking a mandate from its member states to negotiate new, comprehensive air services arrangements with Brazil. This follows completion of an economic study by booz&co. quantifying the benefits.

Brazil is one of the major countries that has not negotiated an "open skies" agreement with the United States.

Outside of its immediate neighborhood, the European Commission has negotiated new air services arrangements with Canada and the United States, and has negotiations underway with Australia and New Zealand.

MIT thesis on the trans-Atlantic air transport market

I recently found available for download a June 2009 MIT thesis The Evolution of Network Competition in Transatlantic Aviation and the Effects of Regulatory Liberalization by Alexander Cosmas. The thesis has an interesting analysis of stakeholder interests in the market. I will leave it to others to comment on the econometrics.

What was of particular interest to me was the concise presentation of the eight freedoms of the air in one diagram (see Figure 1 on page 24) which was sourced from Michael Francesconi at UPS. Usually multiple diagrams are used. The diagram does not distinguish between the eight and ninth freedoms and in an international context (rather than in the US context) I would question the comments that the sixth freedom is "Generally prohibited" and that cabotage is "Always prohibited".

Also I had not come across this quote before from musician Frank Zappa: "You can't be a real country unless you have a beer and an airline."

The impact on aviation of the volcanic eruption in Iceland

I have been trying to monitor the impact on aviation of the 2010 eruptions of Eyjafjallajökull in Iceland and the virtually unprecedented shutdown of European airspace. This post links to some of the resources that I have been using. Some of the web sites are enjoying unprecedented popularity and their performance is suffering accordingly. I have also found Twitter (I use the free program TweetDeck) useful - search for #ashtag.

The eruption itself can be seen on three webcams set up in Iceland. Of course, this is daylight and weather dependent.

Maps with live air traffic over Europe (the advice is use any web browser except MS Internet Explorer) can be seen at:

• RadarVirtuel.com
• flightradar24.com

The official news about airspace availability can be seen on the web sites of:

• Eurocontrol
• NATS - covering the UK

Specific information on the ash cloud is released by the UK Met Office Volcanic Ash Advisory Centre.

On 19 April 2010 IATA commented on the situation and released an assessment that the likely daily revenue loss to airlines of being grounded would be in excess of US$200m per day. ACI Europe and CANSO have made similar estimates for the daily financial impact on airports and air traffic control providers respectively.

Because of the uncertainty about the event, scenario analysis provides useful way of thinking about the impacts. A series of articles from Reuters by Peter Apps are the best I have seen so far:

• Scenarios - Potential scenarios for volcano gas cloud crisis - 18 April 2010
• Scenarios - How could Europe volcano crisis play out? - 19 April 2010
• Scenarios: What if volcano disruption last weeks, months? - 20 April 2010

This truly is a "Black Swan" event (see previous post) and may prove to be a real test of concern about safety versus concern about the economic survival of the European airline industry.

European Commission completes second stage air transport negotiations with the United States

On 25 March 2010 the outcome of the second stage of the air services negotiations between the European Union and the United States was announced:

• European Commission statement and FAQ
• United States Department of State statement
• United States Department of Transportation statement

Aviation Law Prof Blog made the full texts available in a 25 March 2010 posting.

Eight rounds of negotiations were required to achieve this limited outcome.

Reaction included that from IATA expressing disappointment at the lack of significant progress and from the Association of European Airlines (AEA) who described it as "Realistic, but not visionary." The US Air Transport Association (ATA) took a more positive view.

I cannot help but think that the 13 February 2010 draft decision by the US Department of Transportation to grant anti-trust immunity to the joint business agreement between American Airlines, British Airways and Iberia was a significant factor in achieving a positive outcome (see the Journal of Commerce article dated 15 February 2010). It remains to be seen whether the European Commission also grants approval for this alliance.