EU air law: the impact of Brexit for the UK

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2016-10-07

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We review the challenges ahead, in particular those relating to market access, and consider potential alternatives to the current EU single air transport market.

The single air transport market is seen as one of the greatest achievements of the European Union. It has reduced fares for consumers and increased passenger numbers, whilst ensuring passenger safety, security and consumer protection. It has also created an EU vehicle through which current and future air transport relationships with non-EU countries are defined.

Pending final withdrawal of the UK from the EU, the current legal framework for EU air law will remain constant. However, the UK’s decision to leave the EU raises a number of complex and challenging issues that the single air transport market should be alive to now – by way of preparation for when the departure process is completed. The UK Civil Aviation Authority (CAA) has confirmed that there will be no immediate change to civil aviation regulations nor to the CAA’s role in the EU or within the European Aviation Safety Agency (EASA) framework.

Looking forward, having played a major role in the creation and development of the EU single air transport market, the UK must continue to play an active part. Solutions exist to most issues, but achieving them will not be straightforward.

The challenges ahead

Of the key issues for the government to resolve during its Brexit negotiations, those that most concern aviation include:

  • Rights of EU and UK citizens in each other’s countries.
  • Transfer of regulatory responsibility from EU agencies that play a role in UK domestic law, such as the EASA.
  • New arrangements for continued access to the Single European Sky, which is an important European initiative to improve the management of Europe’s airspace.
  • Other EU legislation relevant to aviation, concerning issues such as passenger, consumer and employment rights, the environment, competition, data protection, security, ground handling and air traffic management. (It is encouraging to see that, given the proposal of a Great Repeal Bill, this will be implemented wholesale into UK law, with only minor amendments.)
  • Status of the UK’s commitment to the United Nations’ environmental goals made via EU legislation.
  • Adaption of cross-border security arrangements.

Market access

The greatest impact of the UK’s withdrawal from the EU will be that carriers who hold an operating licence issued by the UK CAA will no longer be ‘Community carriers’ for the purposes of EU Regulation 1008/2008.

In addition, some of the UK’s market access beyond the EU is dependent on its membership of the EU, pursuant to EU comprehensive agreements with Third Countries such as Canada, Georgia, Israel, Jordan, Moldova, Morocco and the USA.
When the UK leaves the EU, it will cease to be a party to these multilateral Air Transport Agreements (ATAs) and the UK will need to negotiate new arrangements with each of these countries. The options available to the UK are to accede to these ATAs as a third party or to negotiate new bilateral agreements with the countries involved, adding more time and delay to the process.

The UK will also have to consider whether UK carriers will require Part Third Country Operator authorisation and operating permits to operate within the EU until such time as an agreement on market access has been reached. Ownership and control considerations will also have a bearing on any new agreements reached.

Solutions to market access

Options for the UK to retain its market access include:

  • Continued participation in the EU internal aviation markets (such as the European Economic Area (EEA) or European Common Aviation Area (ECAA)).
  • Some form of UK-EU ATA.
  • New bilateral Air Service Agreements (ASAs) with the EU/EEA Member States.
  • Alternative arrangements in place of EU comprehensive agreements with Third Countries.

Remaining in the EEA or ECAA offers a comprehensive solution to the market access issues. However, it comes with the same commitments regarding free movement of people that the Brexiteers oppose. Membership of these EU aviation internal markets offers the pre-Brexit deal (including the same rights and restrictions) but without the power and influence the UK held within the EU. It seems, therefore, an unattractive proposal in the context of key Brexit goals.

On this basis, a multilateral UK-EU ATA may be the most viable option. This could allow UK carriers to operate from any point in the UK to any point in the EU, without restriction on frequency. Such an arrangement would encapsulate the privilege provided by the ‘Fifth Freedom of the Air’ (the right for an airline to take passengers/cargo from its own country to a second country, and from that country to another country).

However, securing the Seventh Freedom (carrying passengers/cargo between two foreign countries without any continuing service to its own country) and Ninth Freedom (carrying passengers/cargo within a foreign country) within that arrangement will not be straightforward. Granting permission to other Third Countries for Seventh and Ninth Freedom services has encountered strong resistance. The UK negotiators will need some bargaining tools to achieve a softening in this approach.

This option will also take time to negotiate, given the European Commission’s growing backlog of uncompleted mandates. On the bright side, the UK’s regulatory starting position will be the same as that of the EU’s and the UK’s participation should be attractive to EU carriers, encouraging one to think that such an agreement is achievable.

The alternative of traditional bilateral ASAs presents difficulties as it raises questions of each Member State’s legal competence to negotiate a bilateral agreement with the UK, given the constraints imposed on Member States to negotiate on their own behalf. Along with the issue of consistency regarding market access and the time-consuming nature of the negotiations, ASAs do not offer much comfort as a solution. Unfortunately, the ASAs negotiated prior to the EU internal aviation market have been superseded and are no longer viable fall-back positions.

Conclusion

There are numerous challenges ahead for the UK government to make good on its promise to make a success of Brexit.

In the EU air law context, the government needs to work towards a solution that reflects the current single air transport market. Whilst a number of factors will determine whether that will be possible, the alternatives seem likely to cause significant upheaval and, at the very least, short-term damage to, and uncertainty for, the UK aviation market.

The news of wholesale adoption of EU laws into UK legislation is a welcome bridge, however, to maintaining market access and participation in a redefined EU single air transport market.

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