The European Union has backed an ‘open skies’ deal with the US aimed at opening up transatlantic flights to greater competition.
EU ministers have also agreed to requests from the UK Government to delay plans to implement the new policy from Octobe until March 2008, when a fifth terminal is opened at London Heathrow.
The deal allows EU-based airlines to fly from any city within the EU to any city in the US, and vice versa.
But Virgin Atlantic said the deal did not go far enough because although US airlines would gain free access to European airports, EU airlines would not be allowed the same rights on US domestic routes.
British Airways also expressed reservations about the deal, which will challenge its dominance at Heathrow.
Chief executive Willie Walsh said: “The EU is naive to believe the US will deliver on the next stage of liberalisation without sanctions so we are pleased the UK government has recognised this and demanded an automatic termination clause. However, the five-month delay before implementation is unnecessary.
“With the EU having given away their most valuable negotiating asset – Heathrow – the UK government must stand by its pledge to withdraw traffic rights if the US does not deliver further liberalisation by 2010. Nothing short of an Open Aviation Area by 2010 will be acceptable and we want talks on the second stage to achieve this to start immediately.
“This means delivering a true Open Aviation Area under which airlines from both sides would have free access to each others’ market without restrictions and where it will be possible for a US airline to be 100% owned by investors from the EU and vice versa.
“It is disappointing that the EU has missed the opportunity to achieve these long term gains for customers. Instead, this deal will deliver short term gains for the subsidised American aviation industry.”
After the announcement, EU Transport Commissioner Jacques Barrot said the deal is likely to lead to consolidation among European carriers.
By Bev Fearis
